[Economic Term] Business adjustment policy / Stabilization policy

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Today's economic term is business adjustment policy / economic stabilization policy.

When the economy becomes unstable, such as when prices rise for a long period of time or unemployment continues to rise, people are bound to suffer. Therefore, the government tries to stabilize the economy by using various policy measures, and these government policy efforts are called economic stabilization policy.

When the economy faces a recession that falls significantly below its normal level, the government mobilizes fiscal policy measures to increase fiscal spending or reduce taxes. Meanwhile, the central bank uses policy tools to increase the money supply or lower interest rates. Conversely, when the economy is overheated, policy authorities take fiscal measures to reduce government spending or increase taxes, and monetary measures to reduce the money supply or raise interest rates.

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