Did Australia’s Fiscal Stimulus Counter Recession?: Evidence from the National Accounts

Abstract

A close scrutiny of the pattern of aggregate expenditure recorded in the Australian national accounts reveals it was the behaviour of exports and imports, and not increased fiscal activity, that was primarily responsible for offsetting the fall in private investment due to the Global Financial Crisis. The examination of a broad set of national income and employment indicators suggests that the Australian economy most likely did not avoid a recession, even though it was a relatively mild one by past standards.