By Donald Marron
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Additional info for 30-Second Economics
JOHN MAYNARD KEYNES If governments introduce money into the economy, it will stimulate production, and so lead to full employment. MONETARISM the 30-second theory As its name suggests, monetarism is primarily concerned with monetary policy. Its role in controlling the supply of money into the economy is claimed to be the single most important factor influencing short- and long-term economic changes. In the short term, individual decisions regarding consumption and investment are affected by changes in the money supply.
Treasury—the key to development was deregulation and fiscal discipline. Stabilize: Keep inflation down, reduce trade deficits, and keep the money supply in check. Privatize: Turn public goods, such as water, over to private companies to improve efficiency. Liberalize: Open your borders to free trade and attract foreign direct investment. Deregulate: Don’t limit competition or try to keep players out of the market. And stick to fiscal discipline: Don’t let government spend more than it brings in.
Supply-siders Those who believe that economic prosperity is dependent on creating the best conditions possible for the suppliers of products and services (that is the employers). Thus, regulation should be kept to a minimum and corporate taxes should be as low as possible. Demand-siders believe that empowering workers and encouraging them to consume more creates demand for products, which in turn stimulates industry and creates employment. Thus, governments should invest in educating and creating opportunities for workers and ensuring they get a fair deal from employers through employment legislation.
30-Second Economics by Donald Marron