America, the world’s largest deficit country, is considering a fiscal stimulus of about $800 billion. China, the largest surplus country, has announced a stimulus of $586 billion, although the effect will likely be closer to $158 billion. We calculate that deficit countries are proposing stimulus packages worth 1.7% of world GDP, while surplus countries are offering packages of 0.7% of world GDP. This pattern risks exacerbating global imbalances.

Economist: Big Government Fights Back
Blanchard et al.: Fiscal Policy for the Crisis
IMF: Need for Global Fiscal Stimulus
Beattie: Call for Teamwork on Global Stimulus
Wolf: Global Imbalances