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Part I. Read “Fiscal Policy in the Crisis: Lessons and Policy Implications” by Romer, 2012. 1....

Part I. Read “Fiscal Policy in the Crisis: Lessons and Policy Implications” by Romer, 2012.
1. Do you think Christina Romer as a Keynesian economist or as a Classical economist? Explain briefly.

2. Based on your answer in Part I and 1, plain in words what Romer would say; how fiscal policy will influence the economy, in particular interest rates, investment, saving, consumption, real GDP and growth rate of real GDP.

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Answer #1

I will answer only Q1 as per Chegg policy. Kindly accept Chegg policy.

1) The classical and the neo classical economist did not assign much importance to uncertainty in the economy.The Keynesian economists believed that economic weakness can be caused by uncertainty.Christina Romer made similar observation that uncertainty is the main cause of weak economy and pointed out that the main cause of uncertainty is not the short term issues but the unpredictable nature of the global economies.So Christina Romer is a Keynesian economist.

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