EC-IILS Joint Discussion Paper Series No. 5

A Review of Global Fiscal Stimulus

In response to the global financial and economic crisis that started in 2008, countries around the world embarked on an unprecedented level of intervention with aims to keeping the economy buoyant and stop a full-scale assault on the labour market. Although world economic growth returned to positive territory, a number of labour market challenges persist. At the same time, massive public spending, depressed economic activity, and reduced revenue are causing considerable fiscal pressure. As such, policy makers are urged to bring public expenditures under control, including scaling back programmes introduced as part of stimulus measures. The aim of this paper is threefold: first it gives an overview of the global stimulus spending; second it examines their effectiveness; and third, it presents a snapshot of recent fiscal consolidation measures.