THE RELEVANCE OF FISCAL STIMULATIONS

Abstract

The global financial crisis and the debt crisis in the EU imposed some forgotten aspects of the ways in which countries can draw out from such negative developments in their economies. The most recommendable approach from all was the increased involvement of fiscal policy in stimulating the economy, which was based on coordinated approach of more fiscal authorities in order to achieve a stronger effect. In light of such fiscal aspirations of many countries, this paper assesses the fiscal stimulus and the channels through which the effects of changes in fiscal policy instruments are reflected, i.e. the public revenue and public expenditure.