fiscal stimulus

Syllable breakdown

Dictionary meaning

government spending increases or tax cuts designed to boost aggregate demand and economic activity, typically deployed during recessions or periods of slow growth; fiscal stimulus operates through the multiplier effect, whereby each dollar of government spending generates more than one dollar of total economic activity as the initial spending circulates through the economy; the appropriate scale, timing, and composition of fiscal stimulus packages are subjects of significant debate among economists, with disagreements centring on the size of the multiplier, the risk of crowding out private investment, and the long-term consequences of increased public debt