The Effectiveness Of Fiscal Policy And The Non-Keynesian Effects

Since the birth of Keynesian economics in the1930s, fiscal policy has been considered the main tool of government intervention in macroeconomic managing the demand and achieving the direct macro-control for economy. But, for a long time, Weatern School of Economics have different views on the issue of when government implements the fiscal policy whether it can produce the expected effects. Facing doubts, Keynesian economics has continually improved itself, and gradually formed Post-Keynesian, New-Keynesian, that they are considering the important means of government managing aggregate demand is still fiscal policy, in the short time, it has a significant regulatory role to total economic output, while its long-term effects are more uncertain. Thus, the debate about whether fiscal policy can iron out the business cycle and promote the economic growth, and the discussion about the "Effectiveness","Sensitivity","Robustness" of fiscal policy is still the focus of the current macroeconomic theory researching. More is worth nothing that the1990s, the fiscal policy of "Non-Keynesian effects" raised a challenge to the traditional Keynesian economic theory, researching it depth and systematic has important academic significance for improving macroeconomic and fiscal policy theory.The expansionary fiscal policy has been continually implemented by China’s government Since1998to the beginning of the21st century, but expansionary fiscal policy failed to play its due role to economic growth, so its effects is not satisfactory, therefore whether fiscal policy is also able to assume the task of regulating macroeconomic operation has been widely questioned. It can be said, the reality calls for economists to further research about the effectiveness of fiscal policy. In other words, for domestic scholars, in researching public finance theory, transferring their research priorities to the effectiveness and Non-Keynesian of fiscal policy is a realistic requirement. Based on the above considerations, this paper make the Effectiveness of fiscal policy and Non-Keynesian effects as the main content of researching, in order to drawing some valuable research achievemnts to provide some meaningful guidance for China’s fiscal policy practice by theoretical analysis and empirical test of the Effectiveness and Non-Keynesian of China’s current fiscal policy.Under market economy conditions, fiscal policy as the most important policy instrument of government indirect macro-control, its effectiveness is mainly to promoting economic growth, and its Non-Keynesian effects is mainly to impact the economic growth and effectiveness. Based on the knowledge of the subject, combining relevant theoretical and empirical research achievements raised by domestic and foreign scholars, this paper uses a combination of normative and empirical analysis, a combination of qualitative and quantitative analysis, a combination of static and dynamic analysis, a combination of comparative study and comprehensive analysis, according to the academic paradigm of "theoretical analysis-model ananlysis-practical effect-empirical support". First, on the basis of serious studying, arranging, understanding the relevant research achievements of domestic and foreign scholars, this paper would conduct theoretical and model analysis for the effectiveness of fiscal policy and Non-Keynesian effects. Second, based on this, the paper would also like to carry out the tight visits to the running effect of China’s fiscal policy, and estimate the size of China’s fiscal policy multiplier by empirical analysis, and to illustrate the extent of the "Effectiveness" of China’s fiscal policy. Meanwhile, this paper estimates the existence range of Non-Keynesian effects of China’s fiscal policy, in order to illustrate the general impact of Non-Keynesian to our government using fiscal policy to regulating macroeconomic.This paper uses HP Filter Method, Cointegration Test Method, Variable Parameter State Space Model, Markov Regime Switching Model and other econometric models, Time Series analysis method to conduct reality analysis and empirical test for the Effectivenss and Non-Keynesian of China’s fiscal policy since reform and opening out, the article draws the following important conclusion:First, on the whole, China’s fiscal policy has a positive multiplier effects on economic growth, that is "Keynesian effects". Second, China’s fiscal policy has "Non-Keynesian effects" on economic growth in some period of time. Third, at the beginning of refonn and opening up, economic fluctuations had been exacerbated by the frequent changes of China’s fiscal policy. Finally, Non-Keynesian effects of China’s fiscal policy have a negative impact on the Effectiveness of China’s Fiscal policy, and the causes of it is that the extent of China’s maketing is not high and labor restictions.