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Economics for Business : Assignment

Added on - 23 Jul 2020

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Economics for Business
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1Supply side policies................................................................................................................1UK Economic Environment as implication of Supply side policies reforms.........................1Effects of Supply Side Policies in UK economy....................................................................4Recent changes and supply side policies in UK economy.....................................................9Limitations or disadvantage of Supply side policies............................................................10CONCLUSION..............................................................................................................................11REFERENCES..............................................................................................................................12
INTRODUCTIONTo have the favourable economic environment in the nation there has been developmentof various policies and strategies that helps in enhancing economies. In the present report therewill be discussion based on various supply side policies which are being adopted by the UKgovernment in consideration with enhancing the economic environment of nation. This reportwill be beneficial as there is determining of the various effects, importance, examples as well aslimitation of Supply side polices. Moreover, there will be identification of the policies whichhelp on overcoming with the effects of inflation on country.Supply side policiesThese are the policies which help in enhancing the internal economic efficiency as wellas improving the small scale industries to have better growth as well as fruitful operations.Therefore, these are the policies which are being adopted by the nations as to have the fruitfulincrement in the domestic production. These techniques are very time consuming as theoutcomes of such strategies take time to reflect their actions (Crisp and Powell, 2017). The mainobjective of the supply side policies to enhance the aggregate supply which affects in enhancingthe capacities of economy in consideration with making increment in the quality of theproduction. Therefore, it has various positive effects such as it helps in reducing the rate ofunemployment as well as bring the stable prices over the necessities and household commodities.UK Economic Environment as implication of Supply side policies reformsThe nation has been affected by various external effects such as recession, inflation andother financial crisis. In accordance with the Implication of Supply Side policies in UK, in theperiod 1980-1990 there has been various challenges and competition which has been seen. Thus,the economic policies made by the government in these regard help theme in making adequaterise in the production, reserves as well as standard of living for the citizens (Danaher, Smith andTelang, 2017). However, there has been reforms which are being taken by the UK governmentwith respect to this, such as:1
Illustration1: Supply side policies(Source : Crafts, 2017)Free- Market Oriented Supply Side PoliciesIncome tax cuts:These reforms have helped the nation in terms of reduction in theincome tax rates which was cut from 83% to 40%. Thus, it has helped in terms of giving thebetter wealth and revenue to the societies as well as corporations. Hence, it has been criticised byseveral economists that it impacts of the rise in the labour productivity as to bribe them to makeefforts to earn incentives (Greenfield and Paoli, 2017). However, it can be said that it has helpedthe nation in terms of acquiring the adequate efficiency, development of small scale industries aswell as rising the wealth of society. Therefore, another side effects is that it has helped in risingthe inequality in the nation as the remuneration are being payable as per the qualification andlevel of duties performed by such individuals.Financial Deregulation:It has impacts on various financial bodies such as banks andrelevant institutions which are having adequate amount of reserves and they were being capable2
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