Contact Us
Sign In / Sign Up for FREE
Go to advanced search...

Macroeconomics Objectives of Governments - Essay Example

Comments (0) Cite this document
This paper specifies six main macroeconomic objectives, commonly set by different government the world over. These objectives include; economic growth; control of inflation; reduction in joblessness; control of current account; better distribution of income; environmental conservation…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER98% of users find it useful
Macroeconomics Objectives of Governments
Read TextPreview

Extract of sample "Macroeconomics Objectives of Governments"

Download file to see previous pages This paper offer a comprehensive review of the relative effectiveness of the different tools of macroeconomic policy, adopted by a different country`s governments, in attaining main macroeconomic objectives. The various theories, that suggest priority in utilization of specific tool, often interrelate and are applied by governments primarily to achieve sustainable economic growth.
Generally, fiscal policy and monetary policy are used by the government to achieve the macroeconomic objectives. Whereas, fiscal policy is implemented by government through spending and taxation, monetary policy is essentially the responsibility of the central bank, through the controls of interest rates and the supply of currency. Both policies are implemented to reduce inflation rates and joblessness.
Whereas, each macroeconomic goals can have repercussions on economic factors if they spiral out of control, a number essentially have a more significant impact on citizens. High rate of joblessness not only translates into lost revenue for the government, but can signify a permanent reduction in an individual’s chances of securing employment through loss of expertise.
Low inflation rates is not a big issue, and as long as the citizens are in employment positions with adequate earnings; low rates of inflation will not result in any economic problem. Most people’s earnings, student endowment funds as well as pensions, are modified in line with commodity prices, and therefore, controlling inflation below the 2% level is not a major government concern.
(Kiefer 2000). Nonetheless, increases in inflation may reach a point where its side effects reduces international competitiveness, dampens the hope of foreign inward investors, and shifts redistribution of income from savers to borrowers to a point that it is harsh economic impacts turns out to be a key government concern (Nayyar 2011). Fig 2. Aggregate Expenditure According to Jin (2007), a current account shortfall on the balance of payments may be of less significance to government organizations, especially if the capital markets and the national currency are stable. Conversely, this may imply that an economy’s expenditures have stretched past its revenue collection, and at a given point the expenditure will have to be countered by substantial inflows. The United Kingdom, for instance, has massive foreign investments with substantial revenue potential, which may imply the shortfall will be checked if the economic condition is left to take its own course (Fig 2). According to Kiefer (2008), whereas, governments should not attempt to correct current account shortfalls with demand management practices: policies leaning toward supply have shown better results in regard to the restoration of permanent competitiveness of the economy. According to Froud, Moran, Nilsson and Williams (2010), the most controversial of government objectives is the policy of imposing more taxes on the higher-end population and handing it to the lower-end, in order to bridge the gap between the two economic segments. Kiefer (2000), point out that redistributing revenue from the moneyed to the poor via ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
(“Macroeconomics Objectives of Governments Essay Example | Topics and Well Written Essays - 1500 words”, n.d.)
Retrieved from
(Macroeconomics Objectives of Governments Essay Example | Topics and Well Written Essays - 1500 Words)
“Macroeconomics Objectives of Governments Essay Example | Topics and Well Written Essays - 1500 Words”, n.d.
  • Cited: 1 times
Comments (0)
Click to create a comment or rate a document

CHECK THESE SAMPLES OF Macroeconomics Objectives of Governments

TNCs Interaction with Governments

We also discovered cases where such cooperation was with governments that were involved with issues that a civilized world would not countenance, such as human rights. In the majority of cases though, we discovered that TNC’s were more likely to actively use their influence to persuade or even reverse government policies.
How do Transnational Corporations co-operate and interact with the governments of the countries where they have a business presence? With the rapid growth of the numbers of such corporations and their impact on the global labor and financial markets, this is becoming one of the key issues of the twenty-first century, both for politicians and increasingly the general public as well. However, informed ob...
11 Pages(2750 words)Research Proposal

To What Extent Did the Constitutional Treaty Meet the Objectives Set for It by the Laeken Declaration

Peter Hain, Secretary of State for Wales speaking at Westminster Hall on the Convention on the Future of Europe noted that ‘the protocols envisage a formal role for national parliaments.

A treaty establishing a constitution for Europe was signed on 29 October 2004 in Rome and is required to be ratified by all Member States by November 1, 2006.3 Articles 1-2 of the Constitutional Treaty are consistent with the main goals expressed by the Laeken Declaration. The opening Articles declare that the European Union is founded upon mutual respect for basic human dignity, democracy, equality, human rights and the rule of law in general. The Articles go on to maintain that these goals and values are the mutual concern of al...
12 Pages(3000 words)Term Paper

Macro Economic Policies of the French and German Governments

In contrast, the Socialist Partys Ségolène Royal has made large spending promises which would cost, according to estimates by the Economist (2006), €49 billion per year by 2012. That is almost a third more than the expenditure planned by the current government, and there are questions as to whether the faltering French economy will be able to support such levels of expenditure.
In the three months to September 2006, the quarterly GDP growth rate was zero, when the Bank of France had forecast growth of half a percent. Many economists believe that the flat growth in the third quarter of the year was merely a correction from the 1.2% growth in the second quarter, a view that was born out by 0.7% growth in the...
11 Pages(2750 words)Assignment

Outlining Explicit Learning Objectives and Outcomes for Teachers and Students

Explicit learning is presented by teaching the specific concepts individually and mastery occurs then after. The main key in such a mode of teaching is being highly structured in every activity that is undertaken inside the classroom can be considered as part of the organization of the technique. One of the defining features of the technique is the fact that the teacher commonly points out the part of the lesson where they are in, thus, the term used is explicit teaching (Boyles, 2002).
The explicit form of teaching can be considered to fit lessons that are considered to introduce certain concepts, ideas or skills that are needed to be learned and that the students have low familiarity or experience with. For that matter, the...
10 Pages(2500 words)Report

Which of the Business Objectives Might Best Be Applied to the Southampton Solent University

In other words, there is no explicit reference to the achievement of long term objectives and the people being involved in the business with the express intention of making profits.

In this context, the Southampton Solent University’s existence as a business organization in the strategic business sense would be defined as a clear attempt at continuously engaging in the present and future activities with a view to achieving its long term objectives of which the satisfaction of stakeholders, particularly shareholders, is of paramount importance. Its mission statement is “The pursuit of inclusive and flexible forms of Higher Education which meet the needs of employers and prepare students to succeed in a fast-...
8 Pages(2000 words)Coursework

Macroeconomics and Trade Policys

Keynes argued that prices and wages do not determine the level of employment, as many classical economists suggested, but instead the level of aggregate demand for goods and services (Case & Fair 683). Keynes realized as well during the Great Depression that the government could intervene in the economy to attain specific employment and output goals by either increasing or decreasing taxes and government spending.

For example, raising taxes will decrease the disposable income of households and thus effectively decreasing consumption. When the government decreases consumption, the household demand for goods and services decreases thus it would only seem reasonable that the amount of output that the economy would also...
7 Pages(1750 words)Article

What Is Macroeconomics

While microeconomics is concerned with the factors underpinning the economic life of individual entities like families and small businesses, macroeconomics looks into the various elements that move or determine the economy in its entirety or what some call an aggregate economy. Macroeconomics is useful because it allows a predictive view of how market forces affect the economy and advises governments appropriate economic policies and gives private individuals and business entities a glimpse of what the future holds economically.
The term macroeconomics did not exist prior to the Great Depression but there was a collective set of theories that were used to study the various workings that influenced the aggregate economy. Econo...
8 Pages(2000 words)Assignment

Intermediate Macroeconomics and Macroeconomic Coordination

...CHAPTER 04 (MACROECONOMIC COORDINATION) We know that when GDP, APE & ASF are unequal, than an interplay occurs (Macroeconomic coordination process) which bridges the gap between these variables. If there is a disparity between ADF & ASF, there will be an automatic reaction among money users & suppliers which restores the magnitude of these variables to equality generally known as funding adjustment. Similarly, if there is a difference in the values of GDP & APE, it will trigger the suppliers of goods & services to act together and bring the figure close to equality. This process is called output-price adjustment. The purchasers of the domestic output can be classified into three groups. Group 1 involves individuals having sufficient money...
6 Pages(1500 words)Assignment

The Manner in Which the Federal Government Usurps Powers That Initially Belonged to the State Governments and the Judiciary

.... Body Paragraph 1: The Federal government has been unable to function as to the expectations of the founding father, and a good example is the role that the Federal government plays in taking some powers of the State governments, and the role of the congress in limiting the functionality of the judiciary. James Madison, one of the founders of the state denotes that the role of the Federal government is limited to specific functions and objectives of the whole republic (Robinson, 27). The state government on the other hand, must retain numerous authority and power that would enable it to take care of everyone within its jurisdiction. However, the Federal government, through various legislations has managed to usurp some of the powers...
7 Pages(1750 words)Case Study

Governments Involvement in Local Tourism

... of such pristine places. Limiting the number of people to visit a certain area is not sufficient enough for protecting such areas from the effects of visitation. There are chances that people may buy access considering that most tourists are wealthy and can afford to. Involvement of all the stakeholders in the protection measures of the cultural heritage is key to achieving this objective. The government should invest in public awareness of the importance of conservation of the pristine places. The government should also promote fair use of cultural sites by establishing criteria of use, different from limiting policies (Heidelberg, 2014). Ecotourism principles suggest that a site should have a small number of visitors in order to maintain...
7 Pages(1750 words)Essay
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Let us find you another Essay on topic Macroeconomics Objectives of Governments for FREE!

Contact Us