0 NTRODUCTION; The growth and development of the Nigerian economy has not been stable over the years as a result, the country’s economy has witnesses so many shocks and disturbances both internally and externally over the decades. In such a situation appropriate policy measures are required by the government to affect the levels of aggregate demand. The long-term impact of inflation can damage the standard of living as much as a recession. Such changes benefit some and harm others. Inflation is a period in which the purchasing power with, the people in the economy is high. Fiscal policy is often used in conjunction with monetary policy. But it requires deliberate and well planned […] In a period of economic stagnation, when the private sector is reluctant or cannot manage to create economic stimuli without the state’s intervention, the state has the possibility to stimulate the economy through targeted fiscal policy. Fiscal policy deals with This paper reviews the role of fiscal policy in a number of stabilization programs in Latin America since the early 1980s. But … HYPOTHESIS The fiscal policy of India has influenced the economic growth of the country. The paper highlights the importance of sustainable fiscal adjustment in stabilization efforts, and discusses the main issues that arise in this context. Why has fiscal policy been used so infrequently? Prior to the global financial crisis, discretionary fiscal policy was, in general, not seen as an effective tool for macroeconomic stabilization (Taylor 2000; Blanchard, Dell’Ariccia, and Mauro 2010; IMF 2013).2 Monetary Stimulate economic growth in a period of a recession. The experience of the 1960s, 1970s, and 1980s suggests that democratically elected governments may have more trouble using fiscal policy to fight inflation than unemployment. That is on targets such as high employment, a reasonable degree of price stability, soundness of foreign accounts and an acceptable rate of economic growth. The role of fiscal policy is to provide growth and stability to the economy of a nation or region of the world through government intervention in taxation and the adjustment of government expenditure. the role of fiscal policy in advanced economies, bringing this role to the forefront of economic policy discussions. ADVERTISEMENTS: Stabilization Policy: Budgetary policy has its own bearing on the performance of a national economy. Concern about exchange-rate stabilization has limited its effectiveness. THE ROLE OF FISCAL POLICY IN THE NIGERIA ECONOMIC GROWTH A CASE STUDY OF PHCN . CHAPTER ONE. The political processes of democracy make timely fiscal policy difficult This Economic Letter discusses some of the issues involved in using fiscal policy to help stabilize short-run fluctuations in the economy. Prior to the crisis, academic research and debate among policymakers focused almost exclusively on monetary policy, under the assumption that fiscal policy was not a good stabilizing tool and that the risks associated with debt The effectiveness of fiscal policy is an interesting field in literature of macroeconomics. Abstract. This policy guidance repesents the stability measures which are the fiscal policy and monetary policy. Monetary and fiscal policies are closely related, and both have profound impacts on economic development throughout the world. The Federal Reserve can adjust monetary policy more quickly than the president and Congress can adjust fiscal policy. The growing importance of monetary policy and the diminishing role played by fiscal policy in economic stabilization efforts may reflect both political and economic realities. It has inherent conflicts with monetary policy. FISCAL POLICY AS AN ECONOMIC STABILIZATION MEASURE Fiscal Policy refers to the various decisions undertaken by the government regarding public expenditures and revenue. The role of fiscal policy Fiscal policy can promote macroeconomic stability by sustaining aggregate demand and private sector incomes during an economic downturn and by moderating economic activity during periods of strong growth. Fiscal policy deals with macroeconomic levers of power. This note proposes a research agenda for studying the implications of enhanced capital mobility and limited de facto exchange rate flexibility for the conduct of macroeconomic stabilization. Fiscal policy has proven to be too strong a medicine for the small economic fluctuations we have had. During an economic slowdown, the state can play an important role, through fiscal and monetary instruments. Government economic policy, measures by which a government attempts to influence the economy.The national budget generally reflects the economic policy of a government, and it is partly through the budget that the government exercises its three principal methods of establishing control: the allocative function, the stabilization function, and the distributive function. Government economic policy - Government economic policy - Stabilization theory: The new stabilization policy needed a theoretical rationale if it was ever to win general acceptance from the leaders of public opinion. Keep inflation low (the UK government has a target of 2%) Fiscal policy aims to stabilise economic growth, avoiding a boom and bust economic cycle. In an economy where the productive capacity is well developed, fiscal policy can play an important role in regulating aggregate demand. The second type of fiscal policy is contractionary fiscal policy, which is rarely used. 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