The Impact of the Global Crisis on South Asia

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The Impact of the Global Crisis on South Asia

목차

1. INTRODUCTION

2. Conventional Wisdom And The Crisis

3. The Impact of the Crisis on South Asia

4. THE EFFECTIVENESS OF FISCAL AND MONETARY POLICIES

5. Implications of Policies Undertaken

6. Way Forward

Conclusion

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2. Conventional Wisdom And The Crisis
IMF (2008) pointed to the importance of policy measures to increase demand and restore economic confidence.
The optimal fiscal package
Timely, large, lasting, diversified, contingent, collective, and sustainable.


2. Conventional Wisdom And The Crisis
Why it is that Fiscal policy is back in fashion.
1. One argument suggests that as Monetary and credit policy reached its limit policymakers had no other choice but to rely on fiscal policy more heavily.
2. The other argument is that as the recession across countries was expected to last long, fiscal stimulus would have enough time to yield beneficial impacts despite conventional implementation lags.

2. Conventional Wisdom And The Crisis
IMF (2009a) highlights three channels through which fiscal costs operate
Automatic stabilizers
Other non-discretionary impacts
Discretionary fiscal stimulus

2. Conventional Wisdom And The Crisis
Asian Development Bank (2009a) also notes that a country`s ability to withstand shocks depends on a set of variables that may either amplify or absorb them.

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