Principles of Macroeconomics / Unit 14 MAC 1325 short lesson, about 20 seconds
The Three Lags
Captions available
The idea
Discretionary fiscal policy runs on the same three lags as monetary policy. Recognition waits on data about where the economy is. Implementation waits on agreeing and enacting a measure. Impact waits on the economy's response.
In practice
The anchor calls the middle one the legislative lag.
Where people slip
Fiscal policy's implementation lag is the long one, and its impact lag the shorter.
Your place on the trail
Every lesson rests on earlier ones and opens later ones. Tap any to jump.
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