demand stimulus

demand stimulus - An economic stimulus is an effort by the...

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An economic stimulus is an effort by the goverment to pump money into an ailing economy, whether through spending, tax cuts or interest rate reductions. By replacing money not being spent by businesses or consumers, a stimulus is meant to put a floor under a recession and pave the way for a return to growth. Government measures, normally involving increased public spending and lower taxation, aimed at giving a positive jolt to economic activity. In order to stem this fall, the government launches a spending program to boost the aggregate demand and stimulate spending and economic activity. This is known as a Fiscal Stimulus. creates jobs, Boosting demand, invest The world is now caught in the worst economic crisis since the Second World War, a crisis that has delivered recessions in the United States, the United Kingdom, Japan and the Eurozone Individuals earning less the government has recognized the urgent need for the purchasing power of people to be sustained. The further consumer demand falls, the larger the number of businesses that reduce their workforce or fold altogether. Every sacking means fewer dollars to spend, less demand for products and services, and so takes the economy deeper into crisis. The one-off payments are aimed at arresting the decline in purchasing power and demand for goods and services. addressed the issues of stimulating demand and job creation on a more sustainable footing and with better and more permanent social gains served economic recovery and the needs of people in a far more effective manner and on a fairer basis by such means as increasing age pensions, unemployment benefits, carers' allowances and other benefits by an immediate $50 to $60 a week and by providing welfare recipients with free pharmaceutical prescriptions. These are long-term measures that also meet pressing social needs. The government has guaranteed deposits of up to $100,000 in banks, building societies and credit unions to ensure the stability of banks meet pressing social needs, create thousands of jobs and provide income security for retirees All of its measures so far, such as the guaranteeing of bank deposits up to $100,000, assistance to specific industries, and even the latest package have the primary aim of stabilizing the financial system, stabilizing the economy and bailing out capitalism which
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is in crisis. The one-off handouts serve this purpose, keeping business in business. Businesses, after all, need customers with money in their wallets. A cut of 10 percent in Australia's military budget would free up billions of dollars for job creation and welfare benefits make unemployment decline faster it is likely having a small “multiplier” According to simple Keynesian models, the rationale for increased government spending during a recession is straightforward. If governments employ underutilized labor and capital when they spend more, that provides an immediate boost to employment and output. A further stimulus comes from the spending by the owners of the unemployed
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demand stimulus - An economic stimulus is an effort by the...

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