CHAPTER ONE
1. INTRODUCTION
1.1 Background of the Study
Governments make use of different macroeconomic policy instruments such as fiscal and monetary policies to stabilize the macro-economy and brig about growth to their respective countries. The efficiency of these instruments is still a source of ongoing arguments. The extremity in the debate is to the level that some economists arguing ineffectiveness of fiscal and monetary policies in all countries. There is another group who regard them as important policy tools, while they agree that their effectiveness might depend on different conditions in the economy.
Fiscal policy is one of the commonly used tools in order to achieve goals of growth and stability in a country’s economy through
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Though there are long routed conflicting of thoughts on the issue, there isn’t empirical evidence which is conclusive for either of the thoughts. Government expenditure is one of the important determinants of economic growth. However, the growth of an economy depends on the size and capacity of capacity, and how effectively the capital expenditure was utilized in the development process (Sharma 2012).
There have been a number of studies that attempt to measure the impact of components of government expenditure on economic growth. These studies have continued to generate a series of debate among scholars. Some scholars argued that increase in government expenditure on socioeconomic and physical infrastructure boosts economic growth. However, there is another group who do not agree that an increasing government expenditure encourages economic growth, instead they assert that higher public expenditure may slow down overall performance of the economy by crowding out private
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The first chapter of the thesis is an introduction. This section talks about background of the study and the problem statement. It farther presents general and specific objectives of the study and scope of the study. In the second chapter, related literatures carried out by different researchers on the same issue are summarized. The next chapter discusses the overview of government expenditure and economic growth and Ethiopian trends. In the fourth chapter, data and methodology used in the study are discussed in detail. The data type and sources, estimation technique in the regression analysis and the different sets of tests to test the data and result are described. In chapter five, the results are presented in form of different tables and graphs and discussions are made on the results. In chapter six, which is the last section of the paper, conclusions are made and recommendations are
The next bargain was the fiscal bargain, which was used through around the period of the 1700s up until the 1800s and further. The concept of the fiscal bargain was about rulers needing a larger amount of resources. To obtain these resources, they follow through with expanding on their core bargain with their people by exchanging an expansion on privileges, legal rights such as economic infrastructure, and an expanded internal security, for military power. Fiscal bargain is what makes it possible to have a linear military in which there is an exchange with subjects for there to be a permanent taxing and debt tied to them for the future of the state. This is what makes it possible for there to be giant militaries of over 200,000 soldiers as
In summary, the Legislative Fiscal Bureau provides any necessary assistance in fiscal
Alexander Hamilton is one of America's famous people. Alexander Hamilton was January 11, 1755 or 1757. He was one of the people (who start companies) of the us constitution also a chief to General George Washington also fail/sink (like a ship) of the federalist party. the Fonder of the United the Father of the United States Coast Guard, and the person (who started a company) of The New York Post. As the first Secretary of the Treasury, Hamilton was the first (or most important) author of the money-based policies of the George Washington management.
How does the federal government regulate the economy for the benefit of the public? Discuss specific policies and programs, including their effects. The federal government has many programs and abilities to regulate the United States economy. On of which is the fiscal policy which allows government to raise and spend money.
Ronald Reagan Ronald Reagan was 40th U.S. President, serving two terms from 1981-1989. As president, Reagan cut taxes, increased tax revenues, lowered inflation and unemployment percentages, and built up the U.S. military. He brought the United States out of recession and fixed the mistakes of previous presidents. President Reagan supported and sent supplies to those defending against Communists as part of his “Reagan Doctrine”. Reagan was known for his “Reaganomics”, his policies based on supply-side economics or trickle-down theory.
When the Wall Street Crash of 1929 ushered in the Great Depression—ten years of economic and social devastation—the world grinded to a halt. Herbert Hoover was in his first year in office when he suddenly became the face the world looked to in solving the crisis. Initially, he aimed for a path of voluntarism—based on local and state government working to solve the problems of their specific communities. When he left office in 1933, the American economy remained in shambles. His successor, Franklin D. Roosevelt, however, successfully brought the American economy out of the ashes and, through Keynesian economic policies, restored stability to working peoples’ lives.
John Maynard Keynes was born on the 5th of June 1883 in Cambridge, England. He was the eldest of 3 children who were born into an Upper middle class family. John Neville Keynes, his father, was an economist and a lecturer in Moral Science at The University of Cambridge. John Maynard Keynes is widely known as the father of modern macroeconomics due to his ideas that revolutionized macroeconomics during the 1930s. He was a policy-oriented economist who concentrated on the economic policy of the Government and Macroeconomics.
Fiscal Federalism: Power of the Provinces versus Equitable Programs Fiscal Federalism and Equalization in Canada thoroughly catalogues the dynamics of Canada’s federal government and the provinces in relation to equalization payments and the equitable distribution of public services. The book examines the unequal distribution of services in Canada and attempts to offer solutions drawing on foreign federations with equalization payments and comparing the differences. However, as Canada is unique in the amount of autonomy the provinces individually hold, the relationship that the provinces have towards the federal government severely impacts the applicability of foreign systems to address the equity of services. In addition, the inequity of the
Deficit Spending Norman Harris American Military University 29 January 2017 Deficit Spending Deficit spending is based off the Keynesian ideology of macroeconomics which, in part, believes the government can be used to stimulate the economy. Deficit spending occurs when a government spends more money than what it takes in over a fiscal period, creating or increasing a government debt balance. Government deficits gets it money through the sale of public securities; an example of public securities are government bonds (Roots, nd). Deficit spending is an intentionally calculated plan included in the yearly fiscal budget of the President and Congress to help stimulate the economy (Amadeo, 2016).
Evidence from a Field Experiment in West Africa PC Vicente - Economic Journal
Literature review: spending of government sometimes cannot be stimulative because the government each money may be one dollar can injects to the tax that comes in economy or it is borrow in the future out of the economy. Tax rebates not always help the economy to increase because it comes under government grants and they do not encourage productivity Federal spending is considered as out of control and can grow faster when they are projected in the future that can burdens Americans and making future saddle foe generations with a massive, and cannot be affordable debt. It is necessary that congress should cut current spending and can save for future through entitlement reforms. It can be achievable by not raising taxes and assuring the grants
The data for this thesis paper will be obtained from research online, from
2.0 Procedure A few secondary resources were used in the research process. These sources range from newspapers articles, news website (BBC) and online databases which were accessed via the Internet. These sources were chosen based on direct relation to the topic and its scope. Moreover, these sources were referred to gain better understanding about the topic and explore expert opinions and research done in order to fulfil the criteria of each objective
The nations still are collectively powerful, in that they can use the institution as well as legislative powers to regulate the economic and fiscal situation of the world today. The capacity of individual nations and their powers over the economic and fiscal decisions of their own country, however, has reduced a great deal. Economic policies are now subject to examination by currency and bond traders, trade partners, large corporations, banks, and private investors. It has now become increasingly difficult to make string ling term economic policies which will serve the interest of the country over extended periods of
The fiscal policy is primarily an instrument in the hands of the government whereby it estimates its revenues and expenditures in the economy. This is a very important tool as it would define the flow of money from different sources, indicating the level of activity in the economy. It also defines the broad policies of the government indicating the outwards flow of money in to different sectors of the economy to maintain the overall health of the economy and fulfill its social goals. Apart from the fiscal policy every country has monetary policy at its disposal.