What Is Fiscal Policy?

By Jeremy Bowman – Updated Mar 18, 2025 at 1:59 PM

Key Points

Fiscal policy involves government spending and tax measures impacting the economy and investor decisions.
Contrasting with monetary policy, fiscal policy is set by legislatures and affects stocks and market dynamics.
Investors should monitor fiscal policy changes, which can stimulate markets or adjust economic growth.

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Stacks and stacks of bundled cash. — Source: Getty Images

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Academic views on fiscal policy

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About the Author

Jeremy Bowman has been a contributing Motley Fool stock market analyst, covering technology, consumer goods, and macroeconomic trends since 2011. Before The Motley Fool, Jeremy was a newspaper reporter, restaurant manager, and English teacher abroad. He holds a bachelor’s degree in English from Colorado College and a master’s degree in business administration from American University. One of his Motley Fool headlines was briefly featured on Late Night with Stephen Colbert.

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