Supply Side Policy Lecture

A set of flashcards covering key vocabulary and concepts related to supply side policies and their implications in economics.

Supply-side policies

Policies that increase the productive potential of the economy to supply goods and services.

Long-run Aggregate Supply (LRAS)

The total amount of goods and services that an economy can produce when both labor and capital are fully employed.

Free-market supply-side policies

Policies that provide markets with more freedom, leading to improvements in supply.

Interventionist supply-side policies

Government policies designed to generate supply side improvements through direct intervention.

Infrastructure investment

Investment in facilities and structures for the economy, improving efficiency and productivity.

Deregulation

Reducing legal barriers and extra costs for businesses to facilitate easier market entry and operation.

Education and Training

Programs designed to enhance the skills of the workforce, increasing their productivity.

Reducing direct taxes

Lowering taxes on income and profits to increase incentives for work and investment.

Privatisation

The transfer of assets from the public sector to the private sector, aiming for improved efficiency and profitability.

Reducing unemployment benefits

Lowering benefits to encourage individuals to seek employment by making work more attractive.

Time lags

Delays in the effects of supply-side policies due to the time required to implement changes.

Resistance to implementation

Opposition or pushback against policy changes, often from affected groups or individuals.

Economic growth

An increase in the capacity of an economy to produce goods and services over time.

Inflation

A general increase in prices and fall in the purchasing value of money.

Labour market reforms

Changes made to improve the efficiency and flexibility of the labor market.