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Economic interventionism

 
Economic Interventionism

 
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Economic interventionism
 
 
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Economic interventionism or economic planning is any action taken by a government, beyond the basic regulation of fraud and enforcement of contracts, in an effort to affect its own economy
Economics

File:Ballard Farmers' Market - vegetables.jpgEconomics is the Social sciences that studies the Production theory basics, Distribution , and Consumption of Good and Service ....
. Economic intervention can be aimed at a variety of political or economic objectives, such as promoting economic growth, increasing employment, raising wages, raising or reducing prices, promoting equality, managing the money supply and interest rates, or addressing market failure
Market failure

In economics, a market failure is a situation wherein the allocation of production or use of goods and services by the free market is not Efficiency ....
s.






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Economic interventionism or economic planning is any action taken by a government, beyond the basic regulation of fraud and enforcement of contracts, in an effort to affect its own economy
Economics

File:Ballard Farmers' Market - vegetables.jpgEconomics is the Social sciences that studies the Production theory basics, Distribution , and Consumption of Good and Service ....
. Economic intervention can be aimed at a variety of political or economic objectives, such as promoting economic growth, increasing employment, raising wages, raising or reducing prices, promoting equality, managing the money supply and interest rates, or addressing market failure
Market failure

In economics, a market failure is a situation wherein the allocation of production or use of goods and services by the free market is not Efficiency ....
s. The intervention may to direct, or indirect as in the case of indicative planning
Indicative planning

Indicative planning is a form of fascism implemented by a state in an effort to cause imperfect information in economy and thus decrease economic performance....
. When this economic planning is extensive, the economy is referred to as a planned economy
Planned economy

A planned economy or directed economy is an economic system in which the government or workers' councils manages the economy. It is an economic system in which the central government makes all decisions on the production and consumption of goods and services....
.

Economic interventionism is generally associated with the political left
Left-wing politics

In politics, left-wing, leftist, and the Left are terms applied to Social progressivism and Egalitarianism positions. Originally, during the French Revolution, left-wing referred to seating arrangements in parliament; those who sat on the left opposed the monarchy and supported Political radicalism reform....
 (moderate socialist, center-left liberal, Social Democrat or green
Green politics

Green politics is a political ideology which places a high importance on ecology and environmentalism goals, and on achieving these goals through broad-based, grassroots, participatory democracy....
 parties) which believes that certain market outcomes are undesirable or ineffective and ought to be mitigated. Economic interventionism is sometimes practiced by national conservative
National conservatism

National conservatism is a politics term used to describe a variant of conservatism which concentrates more on "national interests and traditional social/ethical views" than standard conservatism, while not being nationalism or a far right approach....
, fascist
Corporatism

Corporatism is a political culture in which adherents believe that the basic unit of the society is some corporate group, rather than the individual....
 and right-wing parties with the thinking that the free market
Free market

A free market is a market that is free of government intervention and regulation, besides the minimal function of maintaining the legal system and protecting property rights, and is also free of private force and fraud....
 can damage national traditions, social order, or the authority of the state itself.

Types of interventions


Economic interventions common in contemporary governments include targeted tax
Tax

To tax is to impose a financial charge or other levy upon an individual or Legal person by a state or the functional equivalent of a state.Taxes are also imposed by many subnational entity....
es, targeted tax credit
Tax credit

The term tax credit describes two different concepts:*The first is a recognition of partial payment already made towards taxes due.*The second is a state benefit paid to workers through the tax system, which has the effect of increasing net income....
s, minimum wage
Minimum wage

A minimum wage is the lowest hourly, daily, or monthly wage that employers may legally pay to employees or workers. Equivalently, it is the lowest wage at which workers may sell their labor....
 legislation, union shop
Union shop

In the United States of America, a union shop is a place of employment where the employer may hire either trade union members or nonmembers but where nonmembers must become union members within a specified period of time or lose their jobs....
 rules, contracting preferences, direct subsidies to certain classes of producers, price support
Price support

In economics, a price support may be either a subsidy or a price control, both with the intended effect of keeping the market price of a good higher than the competitive equilibrium level....
s, price caps, production quotas, import quotas, and tariff
Tariff

A tariff is a tax imposed on goods when they are moved across a political boundary. They are usually associated with protectionism, the economic policy of restraining trade between nations....
s.

Effects

Economic intervention can be seen by more economically right-wing entities as damaging to the economy. Economically left-wing entities see economic interventionism as a way of ensuring that firms adhere to the social boundaries of that country. It is difficult to suggest precisely what effects it will have on a given society.Economic planning has many after effects like a future scope for the economy.

See also

  • Mixed Economy
    Mixed economy

    A mixed economy is an economic system that incorporates a mixture of private and government ownership or control, or a mixture of capitalism and socialism....
  • Crowding out
    Crowding out (economics)

    In economics, crowding out is any reductions in private consumption or investment that occurs because of an increase in government spending. If the increase in government spending is financed by a tax increase, the tax increase would tend to reduce private consumption....
  • Dirigisme
    Dirigisme

    Dirigisme is an economic term designating an economy where the Form of government exerts strong directive influence.While the term has occasionally been applied to centrally planned economy, where the government effectively controls production and allocation of resources , it originally had neither of these meanings when applied to France...
  • Planned economy
    Planned economy

    A planned economy or directed economy is an economic system in which the government or workers' councils manages the economy. It is an economic system in which the central government makes all decisions on the production and consumption of goods and services....


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