Abstract

HERNANDEZ MOTA, José Luis. REINVENTING THE FISCAL POLICY: A NEW STRATEGY FOR STABILIZATION AND ECONOMIC GROWTH?. Cuad. Econ. [online]. 2014, vol.33, n.62, pp.33-59. ISSN 0121-4772.  https://doi.org/10.15446/cuad.econ.v33n62.43664.

The purpose of the paper is to contribute to the debate on the importance of fiscal policy as a tool for the stabilization and economic growth, while fiscal deficits are not responsible for the financial instability recently experienced by the economies. In this sense, the paper develops a model of Keynesian micro economic fundamentals to demonstrate that fiscal policy, as well as being necessary to stabilize the economy, especially when there is a fragile financial system, cans generate a process of growth if it is coordinated with monetary policy.

Keywords : Fiscal Policy; Monetary Policy; Fiscal Deficit; Economic Growth.

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