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James Fortson




FISCAL POLICY
WHAT IS FISCAL POLICY AND HOW CAN IT BE USED?
Fiscal policy may be used to affect AD; i.e. an increase in
tax and decrease in government spending reduce a
consumer's disposable income less consumption
Less AD.

TAX DESCRIPTION
Income Tax A tax on the income…

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James Fortson




If the government demands more loanable funds (by borrowing from banks or issuing
treasury bonds) then the interest rate will rise (see diagram).

FISCAL RULES (UK AND EU)
1. Golden Rule (UK)

2. Sustainable Investment Rule (UK)

3. Stability and Growth Pact (EU)



NEW LABOUR'S FISCAL LEGACY
Research…

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