The ‘‘St. Louis equation” relates the growth of nominal income (gross national product [GNP]) to both the growth of money and high-employment government expenditures. In other words, it attempts to explain changes in GNP by changes in monetary and fiscal actions. One consistent result of estimating the St. Louis equation for the U.S. economy is that monetary actions have a strong and lasting impact on the growth of GNP, while fiscal actions have only a weak and transitory impact; fiscal effects essentially wash out over four or five quarters.