Please enable JavaScript.
Coggle requires JavaScript to display documents.
KEYNESIAN Income Expenditure Model, Fiscal policy - Coggle Diagram
-
Fiscal policy
-
Australia & GFC
-
Because unlike the US, Oz generally be able to pay their loan -> little increase in the stock of houses for sale
Long run increase in D for housing
- Strength of fin sys
Banks does not succumb to excesses, does not hold toxic A
- strong export performance
- Aggressive coordinated fiscal and monteray policy response
-
-
-
-
Automatic stabilisers
Taxes and transfer payment respond automatically to output gap:
*GDP :arrow_down:, income tax collections :arrow_down: , UE and other welfare benefits :arrow_up: -> increase PAE during contractions and reduce PAE during expansions, without delay
-