The Macroeconomics of Public Expenditures. Vandana Chandra, PRMEP PEAM Core Course January 12, 2004. Key Concepts. Fiscal policy and growth – the connections, complications and trade-offs Macroeconomic balances Debt sustainability. Fiscal policy and growth.
Vandana Chandra, PRMEP
PEAM Core Course
January 12, 2004
= government budget deficit before grants
“Fiscal policy has to be tailored to country specific conditions to foster growth, I.e., a uniform approach to FP in which all countries are counseled to reduce their deficits under all circumstances is not appropriate.” – Baldacci, Clements and Gupta,Finance and Development, December 2003.
The achievement of sustainable growth and poverty reduction is a complex process and determined by the pattern of growth desired and achieved
Ceteris paribus, PE for sustainable growth presents various trade-offs:
All are interlinked and affect the macro environment.