Is Fiscal Policy the Answer?

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Fiscal Policy for Growth and Social Welfare

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2009; World Bank 2009b). China introduced one of the largest fiscal packages in the world (almost 13 percent of GDP), and almost 25 percent of the package was spent on social protection (Zhang, Thelen, and Rao 2010). Over 2009 and 2010, India planned to spend 1.4 percent of GDP. In this package, 0.4 percent of GDP was allocated to low-income housing, irrigation, rural employment, and social assistance, corresponding to 0.4 percent of GDP (World Bank 2009b).

References Abidin, Mahani Zainal. 2010. “Fiscal Policy Coordination in Asia: East Asian Infrastructure Investment Fund.” Working Paper Series No. 232, Asian Development Bank Institute, Tokyo. ADB (Asian Development Bank). 2011. “Completion Report—Indonesia: Countercyclical Support.” Program number 43317, loan number 2563, ADB, Manila, August. Agénor, Pierre-Richard, and Blanca Moreno-Dodson. 2006. “Public Infrastructure and Growth: New Channels and Policy Implications.” Policy Research Working Paper 4064, World Bank, Washington, DC. Aghion, Phillippe, and Jeffrey G. Williamson. 1998. Growth, Inequality and Globalization: Theory, History and Policy. Cambridge, U.K.: Cambridge University Press. Alderman, Harold, and Trina Haque. 2006. “Countercyclical Safety Nets for the Poor and Vulnerable.” Food Policy 31: 372–83. Alesina, Alberto, and Guido Tabellini. 2005. “Why Is Fiscal Policy Often Procyclical?” Working Paper 11600, National Bureau of Economic Research, Cambridge, MA. Arnold, Jens Matthias, Bert Brys, Christopher Heady, Asa Johansson, Cyrille Schwellnus, and Laura Vartia. 2011. “Tax Policy for Economic Recovery and Growth.” Economic Journal 121: F59–80. Atkinson, Anthony B. 1970. “On the Measurement of Inequality.” Journal of Economic Theory 2: 244–63. Ayuso-i-Casals, Joaquim, Servaas Deroose, Elena Flores, and Laurent Moulin. 2009. “Introduction: The Role of Fiscal Rules and Institutions in Shaping Budgetary Outcomes.” In Policy Instruments for Sound Fiscal Policies: Fiscal Rules and Institutions, ed. Joaquim Ayuso-i-Casals, Srevaas Deroose, Elena Flores, and Laurent Moulin. New York: Palgrave Macmillan. Basri, Muhammad Chatib, and Reza Yamora Siregar. 2009. “Navigating Policy Responses at the National Level in the Midst of the Global Financial Crisis: The Experience of Indonesia.” Asian Economic Papers 8 (3): 1–35.


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