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Supply side policy
Action by the government intended to increase the amount that firms are willing to supply at any given price level
Productivity
Measure of output per worker
7 examples of market based policy
Back (Definition)
8 examples of interventionist based policies
Deregulation
The removal of rules that make it difficult to start or expand a business
4 benefits of supply side policies
-enables an increase in long run potential growth
-reduces inflation by increasing capacity
-reduces structural unemployment by equipping workers with skills
-increased productivity makes firms more internationally competitive
3 limitations of supply side policies
-time lags, take years to affect LRAS
-a lack of AD means it won’t have any impact, spare capacity
-cost of implementing
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