According to Keynesian economics, fiscal policy should be coordinated to create a deficit during economic contractions and a surplus during economic expansions.

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Keynesian economics advocates for the use of fiscal policy to stabilize the economy. During times of recession or economic contraction, Keynesian economists recommend increasing government spending or cutting taxes to stimulate demand and create jobs, even if it means running a budget deficit. Conversely, during times of inflation or economic expansion, fiscal policy should be tightened by reducing government spending or raising taxes to cool down the economy and prevent overheating.

According to Keynesian Economics, Fiscal Policy Should Be Coordinated to Create