Since the revised supplementary budget (bill) aims at boosting economy and stabilizing the livelihood of people, it should lead two following results; first, resources distribution for growth-maximizing should be realized, second, the government’s extra spending for livelihood of people would promote consumption. Within this context, this paper firstly analyzes the short-term macroeconomic effects of 2009 the first revised budget (Bill). Then it simulates the effects of functional government expenditure on the purpose of economic stimulus using fiscal policy analysis model. According to the result of analysis, real GDP is expected to increase 0.6% point in 2009 and 0.2%point in 2010 respectively. The results are relatively lower than those suggested by the administration: 0.8%point in 2009 and 0.7%point in 2010.

The results of analysis of the macroeconomic effects of functional government expenditure mainly present two following implications. First, government expenditures in a certain fields are relatively more effective such as land development and regional development, transportation and traffic system, small and medium sized corporations and industries than others. This is because the portion of capital expenditure in these fields is higher. Based on IMF research, the capital expenditure multiplier, 0.5~1.8, is higher than other expenditure multiplier, 0.3~1.0 in G20 states. However, there might be a problem that the inflation pressure appears stronger as time goes on. Second, it is more effective to increase government expenditures on social welfare and education than those on other sectors in the aspect of promoting private consumption. Resource distribution in these fields would maximize consumption and stabilize livelihood of the people.