Supply Side Economics Economic Policy - 804 Words

Do you ever wonder what economic policy is? Economic policy is actions that the government takes to influence the economy in different types of ways, or policies. The actions the government takes can include setting interest rates through the federal reserve, who handles all the money in currency. The government can also regulate how much money they use on different expenditures. The government also uses economic policy when they set tax rates. The types of policies are supply-side economics, demand-side economics, and monetary policy. This essay will cover all these policies. The first concept is supply-side economics. Supply-side economics is a theory that economists believe that economic growth can be most successfully created by putting more money into capital. This concept argues that by lowering barriers on production of goods, and services will also help the economy grow. The term supply-side economics was first believed to have been coined by journalist Jude Wanniski in 1 975, but other sources say that the idea originally came President Nixon s former economic advisor Herbert Stein. One way that supply-side economics was utilized in our history was during the presidency of Ronald Reagan. He planned to cut down tax rates by 30% during his presidency. He made this happen by relieving the tax payments of the rich, so they could invest more money in the economy. This stimulated jobs, and economic growth. Throughout his first term, tax rates were cut byShow MoreRelatedFiscal Policy, Crowding out, Supply-side, Economics1957 Words   |  8 Pages Economics Assignment #2 Question I. Fiscal Policy and the Crowding Out Effect. (a) What is the essence of the accounting identity (the so called saving investment identity) that the two distinguished professors refer to? Saving investment identity  is a concept in National Income accounting that states that the amount saved (S) in an economy is equal to the amount invested (I). It is an equilibrium expressed in terms of supply (S), andRead MoreThe Economic Policies Of Supply Side Economics1150 Words   |  5 Pageslies within a nation’s economic policy. Economic policy is the actions taken by a government to influence its economy. Types of economic policy actions can include setting interest rates through a federal reserve, regulating the level of government expenditures, creating private property rights, and setting tax rates. Economic policy hopes to accomplish economic growth and a stable economy. More specifically, the federal government hopes to accomplish stable prices, economic growth, and full employmentRead MoreUS Economy Under Reagan in the 20th Century557 Words   |  2 PagesReagan in the 20th Century The 20th century economics in the United States were heavily determined by Reagan’s economic policies and political legacies, which eventually resulted in free market expansion. Ronal Reagan, the 40th president of the US, contributed significantly to the boom in America’s economy. A few of the major things he stressed on included controlling inflation, expanding free market, and established major economic laws and policies. When Reagan took office, the economy was experiencingRead More Supply Side Economics Will Benefit the Economy Essay examples636 Words   |  3 PagesSupply-Side economics and policies would best benefit the economy in the case of a recession next year. Supply-side policies are made of several important points to regulate the economy. Supply-side policies consist of stimulating the economy by production, cutting taxes, and limiting government regulations to increase incentives for businesses and individuals. Businesses then would invest more and expand to create jobs for people who would save and spend more money. Thus, increased investmentRead MoreSupply Side And Trickle Down Economics1356 Words   |  6 PagesReaganomics—also known as supply-side and trickle-down economics—is an economic policy practiced by presidents Warren G. Harding, Calvin Coolidge, and Herbert Hoover in the twenties and most recently, by the fortieth president of the United States, Ronald Reagan. Just like the state of the economy before Reagan stepped into office, the economy of the United States today is in a vulnerable place. The economy has taken multiple blows over the last few years: a recession in 2008, a close call in 2011Read MoreThe E conomic Theories Of Supply Side Economics1485 Words   |  6 PagesSupply-side economics is better known as Reaganomics, or the trickle-down economic policy. It is an economic philosophy that conveys the notion greater tax cuts for investors and entrepreneurs provide incentives to save and invest. This economic theory goes further to suggest that in turn, there are economic benefits which will trickle down into the overall economy. The key to answering whether supply side was successful is grounded in a sound understanding of what it is. Like most economicRead MoreThe Decade Of The 1980 S1423 Words   |  6 PagesThe decade of the 1980 s experienced a massive sorts of changes in economics and culture, this requires a certain analysis of the time and the way culture became intertwined with economics. The culture transformed and allowed the decade to be read as an experience of cultural products between culture and economy. Through the conspicuous consumption of the decade, the 1980s encouraged a cultural shift towards complete commodification (what is this) and interaction with the market. Ronald ReaganRead MoreThe Impact Of Economic Policies On The Economy1045 Words   |  5 Pagesto understand the principles and policies that make up our economy. Although many are unaware, the economic decisions made by the Feds, congress, and the president affect how individuals live, invest, and purchase on a day to day basis. As economic policies fluctuate and the value of the dollar increases or decreases, the demand, supply , and prices of goods fluctuate and determine individual s standards of living and how they consume. Whichever economic policies are currently in effect determinesRead MoreImpact of Reaganomics on the American Economy 1014 Words   |  5 PagesKeynesian economics to pull itself out of this low. During the election of 1980, Ronald Reagan’s campaign focused on a new stream of economic policy. His objective was to turn the economy into â€Å"a healthy, vigorous, growing economy [which would provide] equal opportunities for all Americans, with no barriers born of bigotry or discrimination.† Reagan’s policy, later known as ‘Reaganomics’, entailed a four-point plan which cut taxes, reduced government spending, created anti-inflationary policy, and deregulatedRead MoreSupply-Side Economics: History and Relevance2977 Words   |  12 PagesSupply-Side Economics: Its History and Relevance Today. â€Å"Supply-side economics provided the political and theoretical foundation for a remarkable number of tax cuts in the United States and other countries during the eighties. Supply-side economics stresses the impact of tax rates on the incentives for people to produce and to use resources efficiently.† -James D. Gwartney Introduction The theory of supply-side economics has several labels associated with it, some positive and