The influence of the fiscal policy and the automatic stabilizers on the economy

Abstract

The current economical and financial crisis has a powerful effect on the public finances, as in the reduction of
the economical activity lead to the reduction of the budgetary income, increase of deficits and of public debt.
Furthermore, the support given to the banks having problems in the main industrialized counties, materialized in
pumping liquidities into the system but also the taking over of uncertain assets will be finally reflected also on the public
debt.
The anti-cyclic policies consist of an assembly of macro-economical measurements that want either the increase
of the aggregated demand or the encouraging of the global offer. In this paper, a synthesis was attempted of the
conceptual approaches, in terms of defining the automated stabilizers, a synthesis including both the classic/traditional
approaches and the current ones.
Currently, the mix of anti-cyclic policies, of which these automatic fiscal stabilizers are part of, moved from the
use with predilection of these towards fiscal simulation programs of a large scale. Secondary effects of these policies and
of the fiscal stabilizers will me materialized in a never seen increase of the public debt, and in difficulties of covering the
retirement expenditure given the global aging of the population in the developed countries.
In order to reduce the effects of the current crisis, the state calls for fiscal stimulation measurements, those
being a combination of public expenses and tax reduction for companies that want to recover the economical activity,
the increase of the work places’ occupation degree and the caring of the business environment.