How fiscal policy can lead to ‘crowding out’

Note: This is post #128 in a weekly video series on basic economics. Effective fiscal policy has to be timely, targeted, and temporary. But how the central bank, businesses, and consumers respond to fiscal policy also plays a role in how effective it is, says economist Alex Tabarrok. Continue Reading...

The dangers of fiscal policy

Note: This is post #127 in a weekly video series on basic economics. In the early 2000s, Argentina’s debt reached 150 percent of GDP, leading to what was the largest government default in the history of the world. Continue Reading...

The limits of fiscal policy

Note: This is post #126 in a weekly video series on basic economics. The best case for fiscal policy happens during a recession caused by an aggregate demand shock, says economist Alex Tabarrok. Continue Reading...

Fiscal policy: The best case scenario

Note: This is post #125 in a weekly video series on basic economics. When and why does the government might engage in expansionary fiscal policy? When does the government increase spending, or decrease taxes, to combat a recession? Continue Reading...

Introduction to fiscal policy

Note: This is post #124 in a weekly video series on basic economics. What is fiscal policy? As economist Tyler Cowen explains, it’s a government’s policies on taxes, spending, and borrowing. Continue Reading...

When the Federal Reserve does too much

Note: This is post #123 in a weekly video series on basic economics. “If you think through all of the variables that shape a country’s economy, it’s no wonder that monetary policy is difficult,” says economist Alex Tabarrok. Continue Reading...

An introduction to fiscal policy

Note: This is post #124 in a weekly video series on basic economics. What is fiscal policy? As economist Tyler Cowen explains, the simple answer is that it’s a government’s policies on taxes, spending, and borrowing. Continue Reading...

Monetary policy: The best case scenario

Note: This is post #122 in a weekly video series on basic economics. Imagine that you’re the Fed and monetary policy is your domain, says Alex Tabarrok. The economy has been doing fine: inflation isn’t too high, GDP is growing at a reasonable rate. Continue Reading...