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Government Involvement With The Economic Cycle
It is part of the job of central bankers and treasury officials to manage cycles.
One of the primary concerns of the central bank is to manage and control inflation.
Central bankers have dual-responsibilities that are in opposition to each other:
1.Limit Inflation: which requires restraining the growth of the economy.
2.Support Employment: which calls for stimulating economic growth.
Governments:
When governments want to stimulate their country’s economy, they can:
1.Cut Taxes
2.Increase Government Spending
3.Distribute Stimulus Checks
When governments want to slow their country’s economy, they can:
1.Increase Taxes
2.Decrease Government Spending
Jeremy Silva
Jeremy Silva lives near San Francisco with his wife and son. He is a writer, blogger, and personal investor. He is passionate about education, personal development, project management, and investing. His blog has over 100 book summaries on many topics including investing, self-help, and business. You can click on the link to read some interesting book summaries on Jeremy’s website (https://jsilva.blog/book-summaries/).