Topic2-LatikaSharma

Without such spending unemployment would probably

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Unformatted text preview: ntries in 2009 by the G20 stimulus package. Without such spending, unemployment would probably have been much higher in these countries. The current higher unemployment rates observed in both advanced economies and developing economies is a phenomenon that fiscal spending has not be able to easily eradicate. Thus, in view of the current output and employment figures, the overall impact of the fiscal packages on output and employment can be said to be mixed at best. Conclusion In summary, the fiscal stimulus has not been a total failure and has definitely avoided a second Great Depression, although with potential costs. Its failure lies in the poor design and execution by the governments. A well-executed, well-targeted, timely and temporary stimulus package along with a credible medium term fiscal framework and an accommodative monetary policy adjusted to the country specific economic conditions should act as a panacea to a global economic crisis. Along with these, policymakers also need to focus on financial sector repair and reform, withdrawal of stimulus and rebalancing of global demand. *Table 2 Bibliography • World Economic Out...
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