The term fiscal describes something related to financial concerns. For example, fiscal policy is a term used for the entire set of rules and regulations established by national governments to regulate the economy. The main objective of fiscal policy is to encourage positive economic development, push for further growth, and maintain a healthy economy.
A country’s fiscal policy can change from one period to another, depending on the vision of the country’s leaders. Economic theories and opinions vary from one person to another. One group of policy-makers believes that greater controls should be exercised by the government on certain industries, especially those which have a greater impact on the national economy. Others think businesses should be allowed to function as they will and with minimum supervision or interference.
Other factors that influence the direction of fiscal policy is the actual budget which the country has to work with. Since this money comes from taxes, then fiscal policy has to take into account how much is earned via taxation and how to allocate these in order to avoid incurring a large budget deficit. Good fiscal policy makers should be able to look ahead at the possible chain of events that one type of policy or decision can cause. This largely depends on the current needs of a country. For instance, budget allocation for greater infrastructure development may be prioritized to speed up the transfer of goods and allow businesses to function better, thus increasing revenue for the country. In other cases, budget allocation takes on a more long-term perspective, as in cases where certain types of education are funded in order to prepare a large number of citizens to be members of a stronger workforce.