Fiscal austerity is expansionary fiscal measures, such as increases in government spending and decreases in taxes, designed to reduce unemployment.

Question

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Fiscal austerity involves decreases in government spending and/or increases in taxes with the goal of reducing government deficits and debt. This is typically contractionary and can lead to higher unemployment in the short term.

Fiscal Austerity Is Expansionary Fiscal Measures, Such as Increases in Government