Category: Demand-Side Policies

• 1st Jun 2022

  Fiscal Policy: Government Spending

  

  After observing the effects of tax rates, we will move on to look at government spending, the multiplier and the impacts on specific macroeconomic objectives. Another demand-side policy that comes under the fiscal branch is government spending. This is a lot simpler to understand, as Government Spending is a component of AD – an increase…
• 29th May 2022

  Fiscal Policy: Tax Rates

  

  After looking at the Bank of England’s functions, it is time to look at fiscal policy – the demand-side policies implemented by the government to try to meet certain macroeconomic objectives. Firstly, we begin with tax rates, and how they can be manipulated to combat inflation, stimulate growth and meet many other macroeconomic objectives. Taxes…
• 26th May 2022

  Monetary Policy: Quantitative Easing

  

  Having looked at interest rates, it is now time to look at the other half of monetary policy – quantitative easing. This is only used when the economy is severely struggling, and is a much more blunt instrument compared to interest rates, as we will see in this article. Quantitative easing is controlled by the…
• 20th May 2022

  Monetary Policy: Interest Rates

  

  Determined by the Bank of England, monetary policy is one of the most crucial methods of meeting various macroeconomic objectives. However, where it helps meet certain objectives, it can hinder advancing others. In this article, we will explore the monetary policy that is more commonly used – the manipulation of interest rates. An interest rate…