NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Fiscal Policy, Past and Present

Alan J. Auerbach

NBER Working Paper No. 10023
Issued in October 2003
NBER Program(s):   EFG   PE

This paper begins with a review of the current fiscal situation and the causes of its recent deterioration. As a guide to possible policy actions, it provides extensive estimates of past responses of revenues and expenditures at the federal and state and local level. Estimates at the federal level suggest that policy is responsive to both economic and fiscal conditions, and that this responsiveness may have grown over time. For states, economic conditions are less important, but responses to budget gaps are swifter. Equations for federal revenues and expenditures predict tax cuts and expenditure increases given current conditions, but of a considerably smaller magnitude than those initially proposed by President Bush. However, current circumstances are difficult to evaluate because of the enormous implicit entitlement liabilities that were much less significant in the past. This difficulty is but one of the problems facing policy prediction and evaluation.

download in pdf format
   (327 K)

email paper

This paper is available as PDF (327 K) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w10023

Published: Auerbach, Alan J. "Fiscal Policy, Past And Present," Brookings Papers on Economic Activity, 2003, v2003(1), 75-138. citation courtesy of

Users who downloaded this paper also downloaded these:
Auerbach w9306 Is There a Role for Discretionary Fiscal Policy?
Auerbach and Gale w15407 Activist Fiscal Policy to Stabilize Economic Activity
Feldstein w14684 Rethinking the Role of Fiscal Policy
Auerbach w14725 Implementing the New Fiscal Policy Activism
Auerbach and Gorodnichenko w16311 Measuring the Output Responses to Fiscal Policy
 
Publications
Activities
Meetings
NBER Videos
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us