Economic Effects of Fiscal Policy

Federal tax and spending policies can affect the economy through their impact on federal borrowing, private demand for goods and services, people’s incentives to work and save, and federal investment, as well as through other channels. CBO analyzes the economic effects of federal fiscal policies in current law as well as significant proposed changes in those policies.

Blog Post
Additional Information About the Effects of Expiring Provisions of the 2017 Tax Act in CBO’s Baseline Projections
December 4, 2024
CBO’s Director describes how expiring provisions of the 2017 tax act affect the agency’s baseline projections and reviews some information that has become available since CBO first estimated the effects of the tax act in April 2018.
Report
The Long-Term Budget Outlook Under Alternative Scenarios for the Economy and the Budget
May 21, 2024
CBO analyzed the effects on the budget and the economy of eight scenarios that differ from those underlying the agency’s extended baseline—six that vary economic conditions and two that vary budgetary conditions.
Report
The Effects of Pandemic-Related Legislation on Output
September 18, 2020
By providing financial support to households, businesses, and state and local governments, federal laws enacted in response to the 2020 coronavirus pandemic will offset part of the deterioration in economic conditions brought about by the pandemic.
Report
How CBO Analyzes the Effects of Changes in Federal Fiscal Policies on the Economy
November 10, 2014
In certain reports and for some major pieces of legislation, CBO analyzes the short- and longer-term effects on the overall economy of changes in federal tax and spending policies. This report explains the methods that CBO uses.