What should the government spend money onto have the largest effect? (Article: over view of public...
What should the government spend money onto have the largest effect? (Article: over view of public spending)on Marl Thoma's EconomistView Blog
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By Article :Over view of public spending on Marl Thoma ' s Economist view Blog
In order to have the largest impact, the government should increase its spending on welfare programs and increase subsidy and also provide goods and services at subsidized rates mainly to the people living below the poverty line.
This will help in increasing the level of consumption expenditure in the economy and this increase will lead to increase in the level of aggregate demand.
Thus, national income increases and expansion will occur in the economy because of increase in the level of national output in the economy.
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