What is discretionary expenditure stimulus?
In economics, stimulus refers to a discretionary increase in public expenditure. The stimulus effect of public consumption is greater than that of investment, which crowds out private investment. Near the zero lower bound on interest rates, stimulus is more effective. In Finland, construction investment in 2020 grew exceptionally strongly and compensated for the contraction in building construction — although a growing labour shortage may in future weaken effectiveness. (AI translation)
