Budget 2009. FFS/ESRI Budget Perspectives Conference, October 2008

Durkan, Joe (2008) Budget 2009. FFS/ESRI Budget Perspectives Conference, October 2008. UNSPECIFIED.

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Abstract

Since the recovery from the 1980’s depression the economy has performed extraordinarily well. However, during that period it experienced two growth cycles, in the early 1990’s and again in the early 2000’s, when output was well above and well below potential, but did not record negative growth. The economy is now in a further cycle, this time accompanied by negative growth. Fiscal policy throughout this whole period has been pro-cyclical, and this characteristic has accentuated the difficulties faced by policymakers in framing the budget for 2009 and future years. This paper looks at the origins and consequences of this approach and indicates the policy implications.

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