Final answer:
Sound fiscal and monetary policy aim to reduce the duration of an economy's recession phase, but various lags can complicate and delay these efforts, leading to discussions on the best approaches in macroeconomic policy.
Step-by-step explanation:
Economists theorize that sound fiscal and monetary policy can effectively reduce the time the economy is in the recession stage of the business cycle. This reduction in time, however, is challenged by various types of lags such as the recognition lag, legislative lag, and implementation lag. Recognition lag refers to the time it takes to identify that a recession has begun, legislative lag is the time it takes for fiscal policy to be passed through government processes, and implementation lag refers to the time required for the changes in fiscal policy to actually be put into action.
Keynesian macroeconomic policy emphasizes the need for government action to manage aggregate demand and potentially mitigate the impacts of a recession, but this faces critiques from neoclassical economists who may argue that such policies can exacerbate business cycles due to imperfect timing and flawed execution.