ABSTRACT
It is our task to study how changes in the fiscal policy parameters influence the plans of the household in order to find out something of the ways in which the household may be expected to react to changes of fiscal policy. The whole of the previous chapter was devoted to problems connected with income taxes and consumption taxes. Income taxes and indirect taxes are doubtless the most important items on the revenue side of the budget of every modern State. However, there are other types of State income of immediate relevance to households, and a large part of State expenditure represents payments to households. These budget items are also controlled by parameters, which are decisive elements in the planning of households. Of course, we cannot deal here with all the various ways in which the State can influence household planning and behaviour. In the first place, they change from time to time and from place to place; in the second place, the possibilities of using different methods to influence the households are almost unlimited. For that reason we shall confine ourselves to indicating some standard examples.
