Fiscal policy and economic growth essays

Thus, the model is represented in a functional form. The Maintenance of Balance of Payments Equilibrium: The manipulation of the discount rate helps to control the volume of money in circulation.

Thus, the takeover threat will not be a useful mechanism for exerting control; stock market development, Fiscal policy and economic growth essays will not importantly improve corporate control and thus growth. The actions of this expansionary fiscal policy would result in a shift of the aggregate demand curve to the right, which would result closing the recessionary gap and helping an economy grow.

Without efficiently run stock markets, investors have limited means to diversify their portfolios. Taking disciplinary measures against erring members and policing the market.

But at that point — called the threshold point — further economic growth can bring with it a deterioration in quality of life. Europeans adopted very different colonization policies in different colonies, with different associated institutions.

If you are of the Keynesian school of thought, you believe that the economy needs your influence in order to correct itself. My reading of the academic literature leads me to believe that about one-third of the cost of a typical tax cut is recouped with faster economic growth.

New products create demand, which is necessary to offset the decline in employment that occurs through labor saving technology and to a lesser extent employment declines due to savings in energy and materials. The direct measures involves the use of interest rate ceilings, lending ceilings and qualitative lending guidelines.

It is with the view of annihilating these puzzles, that the researcher would apply unit root test and co-integration econometric model, in order to stationarize the data, and ascertain the long run relationship between monetary policy and economic growth in Nigeria. In the same vein, a study by Osinubi and Amaghonyeodiweusing Nigerian data, provided some dissenting evidence that stock market development statistically had no significant effect on economic growth in Nigeria during the period to Specifically, in the deregulated financial environment, the value of deposit is determined by both demand and supply consequently, any tightening of monetary policy by the monetary authority will induce a rise in deposit rate resulting in an increase in the supply of deposits and offsetting to some extend the authorities effort to reduce the growth of money.

In other words, the secondary market operates after the issues had been completed and the securities listed on the Stock Exchange.

On Decemberthe Lagos Stock Exchange was recognized and renamed the Nigerian Stock Exchange NSE following the recommendations of the industrial enterprise panel that branch exchanges be established.

The result indicated that the Nigerian Stock Market over the years, very significantly encouraged the growth of private domestic investment. Specifically, "democracy increases future GDP by encouraging investment, increasing schooling, inducing economic reforms, improving public goods provision, and reducing social unrest.

Other productivity improvements included mechanized agriculture and scientific agriculture including chemical fertilizers and livestock and poultry management, and the Green Revolution. Thus, if the Central Bank wants to reduce the volume of money in circulation because the economy is irking by inflation, it sells securities to be public for which the public pays by writing cheque favoring their deposit accounts.

Again, Chuku using a structural Vector Autoregressive SVAR approach in measuring the effect of monetary innovations in Nigeria found that price based nominal anchors do not have a significant influence on real economic activity modestly.

In Nigeria, licensed stockbrokers of the Nigerian Stock Exchange carry out secondary market transactions in the quoted securities on its trading floors. Unlike physical capitalhuman capital has increasing rates of return. There is a reduced demand for child labor and children spend more years in school.

Short-run variation in economic growth is termed the business cycle.


The secondary market also known as the after-market, is a financial market where previously issued securities and financial instruments such as stock, bonds, and options are bought and sold. Increases in productivity are the major factor responsible for per capita economic growth — this has been especially evident since the midth century.

Relevant discussion may be found on the talk page. They argued that if people could keep a higher fraction of their income, people would work harder to earn more income.

Monetary Policy in Nigeria – The Impact of Monetary Policy on Nigeria’s Economic Growth

By studying a relatively large set of 40 countries in the period — 88, and focusing on the dynamics of market size, they find a strong positive relationship between stock market development and economic growth. Thus, stock markets that ease resource mobilization can boost economic efficiency and accelerate growth Levine and Zervos, As a consequence, it was not able to explain the qualitatively different empirical regularities that characterized the growth process over longer time horizons in both developed and less developed economies.Import substitution industrialisation and economic growth – Evidence from the group of BRICS countries.

Fiscal Policy. In order to learn and understand fiscal policy or monetary policy it is important to whether an economy, no matter where it may be in the world, can self regulate, or whether it needs an outside influence in order to adjust.

Endnotes. 1. The act also created the president’s Council of Economic Advisers. 2. The Phillips curve is a negative, statistical relationship between inflation (or nominal wage growth) and the rate of unemployment. 1. Introduction. Do high levels of public debt reduce economic growth?

This is an important policy question. A positive answer would imply that, even if effective in the short-run, expansionary fiscal policies that increase the level of debt may reduce long-run growth, and thus partly (or fully) negate the positive effects of the fiscal stimulus.

Some of the cookies we use are essential for the site to work (for example, to manage your session). We also use some non-essential cookies (including third party cookies) to help us improve the site. Rethinking Capitalism: Economics and Policy for Sustainable and Inclusive Growth (Political Quarterly Monograph Series) [Michael Jacobs, Mariana Mazzucato] on *FREE* shipping on qualifying offers.

Thought provoking and fresh - this book challenges how we think about economics.” Gillian Tett.

Fiscal policy and economic growth essays
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