Fiscal policy can have a greater impact from "summary" of The General Theory of Employment, Interest, and Money by John Maynard Keynes
Fiscal policy, when effectively implemented, has the potential to wield a more substantial influence on the economy compared to monetary policy. This assertion is rooted in the idea that changes in government spending and taxation can have a direct and immediate impact on overall demand in the economy. By adjusting these fiscal levers, policymakers can stimulate or cool down economic activity within a relatively short timeframe, thus exerting a more potent influence on the level of employment and output.
The efficacy of fiscal policy lies in its ability to directly target specific sectors or groups within the economy that are in need of support or stimulation. For instance, increased government spending on infrastructure projects can create jobs in the construction industry, boosting employment levels and overall economic activity. Similarly, tax cuts for low-income households can enhance thei...
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