The IMF Country Reports Series covers economic and financial developments and trends in member countries. Each report, prepared by a staff team after discussions with officials of the country, is published at the option of the member.
This paper analyzes likely effectiveness of the fiscal policy in supporting aggregate demand in Australia. The simulation analysis illustrates that the type of fiscal measure and the underlying behavioral responses have an important impact on the magnitude of fiscal multipliers. The Global Integrated Monetary and Fiscal Model simulations also suggest that the cumulative impact after five years could be close to 10 percentage points of GDP for the announced stimulus measures that cumulate to almost 8 percentage points of GDP.