fiscal austerity

kinds of austerity

Two Kinds Of “Austerity”: Fiscal and Monetary

“A long period of deficient demand can discourage workers. It can also hold back investment: a new project may be profitable but if there is no demand it will not get financed,” says Simon Wren-Lewis. The point is that deficient demand was not due to “fiscal austerity”, but to “monetary austerity”.