Economic Stimulus Packages

Article Summaries
“Nature of Stimulus Package”
This part of the article reviews the essence of a stimulus package
towards recovery of the economy and restoring the vibrancy of the
economic fundamentals. From a Keynesian point of analysis, the
conclusion is that the only solution to the economic crisis is increase
in consumption other than capital. The main point that comes out is that
a stimulus package will only increase the amount of capital and solve
the crisis temporarily as it does not invoke the real economic drivers.
“Stimulus Package Mean More Loss of Capital”
Moreover, the second part describes the macro-economic fact that a
stimulus package results to the loss of capital and does not resolve a
crisis. Instead of introducing more capital, depression or recession
needs policies that touch on production and economic performance of the
factors of production namely land, capital and labor. Further economic
problems are reflected in the lack of employment and productive capital.
“Stimulus Packages are a drain on the Rest of the Economic System”
The third part describes the effects of a stimulus package on the rest
of the economic system due to the effects of the plan on the main
fundamentals of a macro-economic system. This makes the intervention an
expensive package to the economy as well as reducing the levels of
“Rising Prices in the midst of Mass Unemployment”
This article looks into the micro-economic factors of pricing as
discussed along the macro-economic aspects of employment in relation to
solving economic crisis by stimulus packages. To solve such crisis,
these packages should be stopped and pricing policies reviewed to
increase consumption levels. As the best way to solve an economic
problem, increasing consumption will reflect into demand driven increase
in employment which improves the overall production in an economy
compare to the macro-economically expensive stimulus packages.

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