The timing of fiscal policy may be more difficult than the
timing of monetary policy because:
- Decision-making body of fiscal policy is large, and it takes
much time to arrive at a mutual decision. For fiscal policy
decisions, the president and members of congress should have a
majority. Whereas, in monetary policy, there is a committee of 12
members who take decisions regarding the monetary policies. And
because it has a lesser number of members, it manages to make
decisions quickly.
- Time of implementation in fiscal policy is more than monetary
policy. For example, if fiscal policy is to charge purchases of the
government, then it may take time to plan purchases, plan the bid
to purchases, and then finally implementation process begins
Whereas, implementation of monetary policy begins much
quicker.
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