Fiscal Policy — Important Questions

Prof. Dalton

Prof. Dalton gave the definition linking public finance with the income and expenditure of public authorities.

It is concerned with the effects of public expenditure, taxation and public borrowing on income, output and employment

Fiscal policy is defined in terms of public expenditure, taxation and public borrowing and their effects on income, output and employment.

To maintain price stability

One key objective of fiscal policy is to maintain price stability.

Expenditure incurred by central, state and local governments for collective needs or welfare

Public expenditure means spending by central, state and local governments for collective needs and welfare.