Economic Policy

Economic policy refers to the actions a government takes to try to manage its nation’s economic health. Economic policy includes three major areas. Fiscal policy includes the government’s management of its deficit, including taxation in order to raise revenue and government spending. Monetary policy includes the issuance of currency, interest rates, and other efforts to control the amount of money in circulation and to control inflation. Trade policy includes those actions a government takes to regulate international trade, including tariffs and tax agreements. The International Monetary Fund and World Bank exert a great deal of influence over many nations’ economic policies