What affects a nation's economy

economic policy instruments

the concrete measures that are taken and carried out by the various agencies of economic policy (see there) in order to influence the economic order, the economic process or the economic structure in accordance with the economic policy goals (see there).

Economic policy instruments can be systematized according to different points of view: with regard to the carrier of economic policy e.g. B. between fiscal policy (see there) and monetary policy (see there). With regard to the effect of the instruments on economic policy goals, instruments with a direct effect are contrasted with those with an indirect effect.

When using direct instruments, the carriers of economic policy behave like market participants and try to influence what is happening in the market with regard to the aims pursued in each case. So the state can z. For example, by increasing its spending on public investments, it can directly influence overall economic demand and thus contribute to the recovery of the economy. The use of indirectly acting instruments is intended to influence the behavior of private market participants in such a way that the desired economic policy goals can be achieved through their reactions to state measures.

Reports on the overall economic situation or the announcement of important economic data by state institutions serve to inform the public and are intended to help improve the individual economic decisions of private market participants. Other instruments with an indirect target effect are, for example, state incentives and measures such as the granting of savings premiums under certain conditions or state appeals such as reminders to the collective bargaining partners for moderate wage agreements.

Duden Wirtschaft from A to Z: Basic knowledge for school and study, work and everyday life. 6th edition. Mannheim: Bibliographisches Institut 2016. Licensed edition Bonn: Federal Agency for Civic Education 2016.