FISCAL POLICY: Use of the federal government's powers of spending and taxation to stabilize the business cycle. If the economy is mired in a recession, then the appropriate fiscal policy is to increase spending or reduce taxes--termed expansionary policy. During periods of high inflation, the opposite actions are needed--contractionary policy. The consequences of fiscal policy are typically observed in terms of the federal deficit.

     See also | government sector | stabilization policies | government purchases | taxes | transfer payments | federal deficit | full-employment budget | business cycle | recession | contraction | expansion | unemployment | inflation | crowding out | expansionary fiscal policy | contractionary fiscal policy | automatic stabilizer | monetary policy | recessionary gap | inflationary gap |

FISCAL POLICY, AmosWEB GLOSS*arama, http://www.AmosWEB.com, AmosWEB LLC, 2000-2026. [Accessed: August 7, 2026].

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The ability of buyers or sellers to exert influence over the price or quantity of a good, service, or commodity exchanged in a market. Market control largely depends on the number of competitors on each side of the market. If a market has relatively few buyers, but many sellers, then limited competition on the demand-side of the market means buyers tend to have relatively more market control than sellers. The converse occurs if a market has many buyers, but relatively few sellers. This is also termed market power.

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