Spending which a government body is empowered but not legally required to undertake. This can include both spending on real goods and services, such as public works, and grants to individuals or organizations. Discretionary spending is contrasted with mandatory spending programme, where certain forms of spending are required by law or by the rules governing schemes like pensions or disability benefits. Supporters of discretionary spending argue that it enables local government to respond to variations in public opinion about what forms of public spending are desirable. Critics say that it makes the availability of some public services depend on where people live.

• leading indicator
• leads and lags
• leakages from the circular flow of incomes
• learning by doing
• lease
• leasehold
• leasing
• least-developed countries
• least squares
• least-squares regression
• legal tender
• leisure
• lemon
• lender of last resort
• lending, property
• lending rate, minimum
• Leontief paradox
• Lerner
• less developed country
• leverage
• leveraged buy-out
• levy, capital
• levy, import
• liabilities
• liability