Government Surplus and Deficits

Government Surplus and Deficits

Fiscal Policy is one of the main policy tools used by governments to try to smooth, albeit not entirely eliminate, business cycles. In the last video of his series on "Fiscal Policy", Tim explains us the effects of fiscal policies on deficits, the evolution of government debt. Further, he highlights the importance of coordination of Fiscal, Monetary and Regulatory Policies.
Overview

As you have learned from viewing the first three videos about fiscal policy, governments can deploy discretionary fiscal policy to influence economic cycles, with the objective being full employment and low inflation. However, expansionary fiscal policy often comes at a cost in the form of a higher annual deficit and – consequently – higher national debt.

Key learning objectives:

  • Explain how discretionary fiscal policy affects deficits and national debt

  • Understand how deficits and national debt have changed in the recent past in the US and UK.

  • Discuss how the coordination of monetary, fiscal and regulatory policy affects the potency of government and central bank countercyclical policies.

Join now to watch

This content is also available as part of a premium, accredited video course. Sign up for a 14-day trial to watch for free.

Summary
logo-animationlogo-animationlogo-animation
Expert
Tim Hall

Tim Hall

Tim has nearly 30 years of experience in the international capital markets at major global institutions and has worked both on the buy-side and the sell-side. He has worked with numerous companies, banks and governments in developed and emerging markets on investment grade and high yield bond issues, from straight-forward to very complex acquisition/leveraged financings. Tim has also been on the board of a UK “challenger bank.” Tim has an MBA from the Wharton School, and is a CFA.

Related videos

Join now to watch

This content is also available as part of a premium, accredited video course. Sign up for a 14-day trial to watch for free.

,