Supply Side Policies

Question 1

Supply side policies

Answer 1

designed to increase the productive potential of an economy (shifts LRAS out)

Question 2

interventionist supply side policies

Answer 2

designed to target specific market failures eg gov spending on education, healthcare and infrastructure

Question 3

market led supply side policies

Answer 3

designed to improve the efficiency and competitiveness of markets eg decrease income tax, privatisation, reducing trade union power, welfare reform

Question 4

AO4s for interventionist ss policies

Answer 4

-large opportunity cost
-time lag
-hard to gage effectiveness

Question 5

AO4 for market led ss policies

Answer 5

-equity argument : increased efficiency at a cost of equity