Question Description

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Task 1

Discussion assignments will be graded based upon the criteria and rubric specified in the Syllabus.

For this Discussion Question, complete the following.

1. Read the first 13 pages of the attached paper which discusses the effect of government intervention on recessions.

2. Locate two JOURNAL articles which discuss this topic further. You need to focus on the Abstract, Introduction, Results, and Conclusion. For our purposes, you are not expected to fully understand the Data and Methodology.

3. Summarize these journal articles. Please use your own words. No copy-and-paste. Cite your sources.

Task 1`

In every country,  the government takes various steps to manage the economy to achieve price stability, full employment, and growth. Based on that, the United States government influenced the activities of the economy through fiscal policy and monetary policy. Both are effective policies to control the economy and also for intervening in the recession of the country. Through monetary policy, the government will exert its power to govern the level of interest and money supply. Then the fiscal policy will use its power to spend and to tax. To counter a recession, the government will also use expansionary policies to reduce the interest rate and increase the money supply (Russo, et al., 2020).

Moreover, the government also tries to overcome the market inequities from recession through taxation, subsidies, and taxation. The process like maximizing social welfare is also one of the effective and commonly understood motives for government intervention. A government can also influence the economic growth rate through the policies of the supply-side and demand side. Different expansionary fiscal policies can cut the taxes to encourage spending and to increase disposable income.

 There are also certain lower taxes where they can increase the budget debts and lead to increase borrowing. In the global market, various individuals have a profit incentive to cut and innovate costs. This government intervention can be a regulatory action seized by the government which seeks to alter the effective decisions made by groups, organizations, and individuals about economic and social matters (Zhou, Wang, Lu, & Zhu, 2020).

 Many companies will affect monopoly power to pay fewer wages to charge consumers high prices. So, without government intervention, people can promote competition and regulate monopolies over the financial crisis’s culprit with supervision and regulation because it decreases the causes of unemployment jobs.


Russo, G., Levi, M. L., Seabra Soares de Britto E Alves, M. T., Carneiro Alves de Oliveira, B. L., de Souza Britto Ferreira de Carvalho, R. H., Andrietta, L. S., Filippon, J. G., & Scheffer, M. C. (2020). How the “plates” of a health system can shift, change and adjust during economic recessions: A qualitative interview study of public and private health providers in Brazil’s São Paulo and Maranhão states. PloS One, 15(10), e0241017.

Zhou, Z.-J., Wang, Y., Lu, M.-M., & Zhu, J.-M. (2020). Government Intervention, Financial Support, and Comprehensive Efficiency of Enterprise Independent Innovation: Empirical Analysis Based on the Data of Chinese Strategic Emerging Industries. Mathematical Problems in Engineering, 1–10.

Task 2


            Government interference is any steps by the government or the public body that influence the market economy, with direct intent, beyond mere contractual regulation and the provision of public goods, to affect the economy. Three types of decisions to be taken in an economic framework. What is produced, who is produced and how the economic product is allocated. In a free-market economy, buyers and sellers who interact in a free market that is not regulated by the government or any other authority are the solutions to these three sets of questions (Fernández-Kranz & Rodríguez-Planas, 2018, pp. 492-524).

On the other hand, a managed economy, on the other side, on the free enterprise economy, has complete power by the government over capital distribution. However, any analysts have questioned the two economies for being too drastic and are only technically feasible. People accept that in these two economic systems, a hybrid economy, we need more. The government will have a role in managing the market, but buyers’ and sellers’ decisions will guide all other practices (Bilau, Mason, Botelho, & Sarkar, 2017, pp. 1516-1537).

However, some argue that government interference in various areas is favored, such as externalities, government commodities, and monopoly control. In recessions, private sector spending and investment are falling sharply, resulting in weaker economic growth. If the government also reduces spending, economic growth will drop even more, and morale will fall. In a deep recession, policymakers will borrow and invest money using unemployed resources from the private sector. In the absence of political interference, there is no genuine paradigm of culture. Even the most conservative liberal economists agree that state land rights and national defense spending need to be covered. The topic centers on the reach of government interference. In any area of government action, something must be achieved. The claim and opposition to government involvement in macroeconomic stability vary widely from and against the argument that universal healthcare is being provided (Harashima, 2017, pp. 1-13).


Bilau, J., Mason, C., Botelho, T., & Sarkar, S. (2017). Angel investing in an austerity economy – the take-up of government policies in portugal. European Planning Studies, 25(9), 1516-1537. Retrieved from

Fernández-Kranz, D., & Rodríguez-Planas, N. (2018). The perfect storm: graduating during a recession in a segmented labor market. ILR Review, 71(2), 492-524. doi:10.1177/0019793917714205

Harashima, T. (2017). Should a government fiscally intervene in a recession and, if so, how? Retrieved from

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