While recent developments in monetary theory have been fast to spread to policy analysis and practice and the media, the same is not true of fiscal policy, and a void has emerged. Issues such as timing, cyclical adjustments, long-term sustainability, and social implications are often seen as detached from discussions in the public arena.
This book fills this gap. It delivers a keen assessment of the role and scope of current fiscal policy. New contributions and critical reviews of state of the art research analyze fiscal policy in terms of viability, potency, consequences and sustainability, and also shed light on its relation to economic and political ideas.
The general tone of this volume is cautiously favourable of fiscal activism, although the emphasis is placed more on medium-term adjustments than on short-term `fine-tuning'. The authors believe that the legacy of the last fiscal revolution has been an excessively negative view of deficits and debt, and believe that this volume will contribute to open a dialogue on fiscal issues, and bring back a more balanced view of fiscal policy. With contributions from leading authorities including Barbara Bergmann, Jeffrey Frankel and David Colander, this is a major new contribution to the field.
Matias Vernengo is Assisstant Professor of Economics at the University of Utah, Salt Lake City, USA.
List of figures; List of tables; List of contributors; Acknowledgments; Preface by James K. Galbraith; 1 Introduction; Per Gunnar Berglund and Matias Vernengo; Part I. Fiscal policy strikes back; 2 The case for fiscal policy; Philip Arestis and Malcolm Sawyer; 3 A fiscal policy to counter recessions: triggered transfers to households; Laurence S. Seidman and Kenneth A. Lewis; 4 Integrating sound finance with functional finance; David Colander and Peter Hans Matthews; 5 Regime change for the US Federal budget; Max B. Sawicky; Part II. Fiscal policy in the periphery; 6 Grappling with fiscal reform: the case of the Dominican Republic; Esteban Perez Caldentey; 7 Endogenous Fiscal Crises: Theory and Brazilian Experience; Matias Vernengo; 8 Fiscal programming and alternatives in debt management: the Turkish experience; Ebru Voyvoda; Part III. Fiscal policy for our grandchildren; 9 Paradox of Thrift and Budget in a Simple Keynesian Growth Model; Per Gunnar Berglund; 10 Budget deficits, unemployment and economic growth: a cross-section time-series analysis; Robert Eisner; 11 Debt sustainability in the European Monetary Union: theory and empirical evidence for selected countries; Alfred Greiner, Uwe Koeller and Willi Semmler; 12 Varieties of Fiscal Stimulus: A Conflicting Claims Analysis; Alan G. Isaac; Part IV. What are the questions?; 13 The political economy of the deficit (roundtable session); Barbara R. Bergmann, Jeffrey A. Frankel, William A. Niskanen, Laurence S. Seidman (participants); Matias Vernengo (moderator); with an introduction by Per Gunnar Berglund and Matias Vernengo; 14 The final word on fiscal policy (interview); Robert Eisner; with an introduction by Per Gunnar Berglund;