A policy of expansionary austerity involves increasing government spending to increase private-sector confidence, leading to an increase in output and employment.

Question

Quizplus · Accepted Answer

A policy of expansionary austerity involves reducing government spending and increasing taxes as a means of reducing budget deficits and debt, which can lead to short-term economic contraction. It is often criticized for hurting vulnerable populations and can have uncertain long-term effects on the economy.

A Policy of Expansionary Austerity Involves Increasing Government Spending to Increase