Understanding Supply Side Policies: Interventionist and Free Market Approaches

The video discusses supply side policies, which aim to enhance an economy's productivity by expanding the long-run aggregate supply (LRAS) curve. These policies are divided into interventionist and free market approaches. Interventionist policies involve government actions like education and infrastructure investments, while free market policies focus on reducing taxes and regulations to boost market forces. Despite their potential for sustainable growth, these policies face challenges such as long time lags and lack of immediate benefits, which can deter government investment.

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