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If the def/GDP ratio is unchanged year-to-year, there's no change in fiscal impulse, neither drag nor boost.
Ours is, of course, falling, and that goes beyond "negative fiscal impulse" over into the dreaded austerity.
My guess is that the deficit as a share of GDP will be around the same this year as last year, meaning little or no "negative fiscal impulse".
After all, according to their dogma, the relationship between the direction of a fiscal impulse and economic activity is supposed to be positive, not negative.
A brief refresher: a summary measure of fiscal impulse (the extent to which fiscal policy is boosting or reducing GDP growth from one year to the next) is the difference between the deficit (or surplus) one year and the next.
If the government was spending $100 billion in year one or fiscal stimulus, and $75 billion in year two, the negative fiscal impulse is $25 billion, and the impact of stimulus on GDP growth shows up as a minus sign, the same way a car's speedometer falls when you take your foot off of the gas.
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In order to characterize debt consolidation processes in Spain, we proceed following the approach in the seminal paper by Alesina and Perotti (1995) which identifies "significant fiscal impulses" in OECD countries between 1960 and 1992, in order to study the determinants of "successful" budget consolidation processes.
But in economics, it is well understood that as stimulus winds down, policy makers by definition create what's called negative fiscal or monetary impulse.
To provide an adequate fiscal base, Abū Bakr enlarged impulses present in pre-Islamic Mecca and in the ummah.
Today Mr Brown, a master of reinvention over his long political career, presents himself as a pragmatist whose visionary impulses are tempered by a ruthless fiscal rectitude.
Paul Sheard of Lehman Brothers, an investment bank, reckons that stronger growth in Japan will trigger more fiscal tightening.Mr Koizumi's landslide election victory on September 11th strengthens that impulse.
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