Business Organizations in the UK

ECONOMICS FOR BUSINESS 2, UK
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TABLE OF CONTENTS
Introduction......................................................................................................................................3
Concept of economic theory in UK.................................................................................................3
Basic growth theory with examples.................................................................................................5
Analysis of supply policy by UK government to facilitate economic growth................................7
Conclusion.....................................................................................................................................17
Reference List:...............................................................................................................................18
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INTRODUCTION
Business economics is generally a field an applied economics. It deals with an analysis of
business organizations. It uses the concepts of economic theory as well as quantitative methods
to analyze various factors associated with business activities. It consists of analysis as well as
discussion of various factors towards supply policies as well as impacts associated with it. This
study lays focus towards the explanation of theories towards supply policies. It offers
explanation regarding supply policies of the British government towards economic growth as
well as well as development this deals with analysis of factors associated top economic growth
and development
CONCEPT OF ECONOMIC THEORY IN UK
Growth of British economy
Financial crisis has slowed down the growth of British economy. Since 2013 it has been
growing constantly. It has encountered growth every quarter from the year 2013. The policies of
the British Government towards a growth of economy include revision as well as reforms to the
Tax systems in the UK. It includes initiatives towards making as well as developing the UK an
attractive place to start the new business as well as foreign investment. The policy of the
government of UK includes reduction of corporation Tax by 20% from the year 2015.
GDP
Figure 1: GDP rate in the UK
Source: (www.tradingeconomics.com ,2017)
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The policies of the British Government focus on increasing the economic growth by
increasing the demand policies as well as supply policies. The policies are directed towards
increment of demand policies includes the establishment of Fiscal policy; it consists of tax
reduction and cutting rates of interest. Vahlne et al. (2014, p.500) opined that the policies of the
British Government towards supply side include privatization, reduction in taxes, trade
agreements. Improvement educational policies, improvement infrastructure facilities are some
other factors. The policies of the government are directed a way towards increment of foreign
investment associated to education, tourism as well as business activities
ANALYSIS OF SUPPLY POLICY BY UK GOVERNMENT TO
FACILITATE ECONOMIC GROWTH
Supply side policies are highly significant that government authority undertakes for
increasing productivity level and shifting aggregate supply to the right. From assessment, it has
identified that supply side policies can be distinguished into two types such as free market and
interventionist. On the basis of free market policies, by placing emphasis on the aspects of
privatization, deregulation, income tax reduction, flexibility in the labor market, free trade
agreement etc UK government can facilitate high economic growth (Policies for Economic
Growth, 2018). On the other side, interventionist policies include public sector investment in the
infrastructural aspects. In addition to this, it also includes education, vocational training and
health spending. Hence, by making focus on all such aspects UK government can enhance the
level of economic growth.
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