Fiscal Policy Essay

462 words - 2 pages

Assignment
On
Fiscal Policy

Issues:
← What is the most prominent document that elaborates the Fiscal Policy of Bangladesh?
← As head of the government how would you design your next fiscal policy?

Submitted By
Md. Mizanur Rahman
Roll No: 03
MPA in GPP

April 18, 2011

Introduction

Fiscal policies play a main role to the economic development of a country. It is the decision of the government about How to earn revenue and gather resources from various sources, for what to spend those earnings and resources, how much to spend and, when to spend. Main elements of fiscal policy are a) Government income and b) Government expenditure

The most prominent document that elaborates the Fiscal Policy of Bangladesh is the National Budget passed in the Jatio Sangsad (The National Assembly of Bangladesh) every year.

Fiscal Management ...view middle of the document...

e. to run the government
❖ To ensure protection for the helpless
❖ To provide necessary services to people that otherwise nobody would provide (Market failure)
❖ To ensure development of the country
❖ To build buffer against risk!
❖ building socio-economic and physical infrastructure
❖ human resource development and
❖ Poverty alleviation.
❖ Administrative
❖ welfare and
❖ Other service oriented activities.

➢ Establishing Equity
❖ Inequality prevails in all societies.
❖ Government tries to reduce the gap between the rich and the poor
❖ For this, the government collects taxes from the rich and spends it for the poor
❖ Efficiency in resource allocation:
❖ Private entrepreneurs may not be interested in investments where return of investment is not good for him but good for the country
❖ In this case, the government may step ahead and supply resources for such investments
❖ Example: building roads and highways, Public-Private Partnership (PPP)
❖ Provision of public goods
❖ Check market failure i,e, ensuring price hike.
❖ Encouraging agriculture sector.
❖ Establishing Agro-based industry to uplift living standard of marginal farmer and creating employment opportunity.
❖ Promoting livestock sector.

➢ Long term Investment
❖ Improving public health.
❖ Improving water management.
❖ Investing on energy and power sector.
❖ Investing on communication system i,e, railway sector.
❖ Developing human resource through proper education and training.
❖ Addressing clement change issue.

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