International Economic Policy in Times of Crisis Essay

Governments face all kinds of crises every day, the approaches may be different but the goal is always the same—maintain stability. While, wars and crimes against humanity tend to take a toll on the population, infrastructure and terrain quite literally, financial crises can psychologically cripple a country. There’s something about a financial crisis that conjures a level of panic that could rival the outbreak of a deadly disease. Maybe this is caused by a lack of visible end, as it seems the light at the end of the tunnel is only made clear at the end of the crisis. Even with examples from history to refer to, each financial crisis seems to take on a version all its own like a new strain of a deadly virus. The government tries to†¦show more content†¦The Austrian School, support free market but believe there are too many variables and the shifts in equilibrium occur too quickly to rely on models instead use logical deduction based on fundamental axioms (). Mo netarists believe that the emphasis should be on the role of governments in controlling the money supply (). Keynesian economics and its modern variations remains a common school of thought in the U.S. that focuses on analyzing macroeconomic elements in the short term using models (). The protectionist inclined schools, like the American School and at times the Austrian School, prefer to use import tariffs and/or industry subsidies to calm the economy (). While, believers in free trade, like the Keynesian School and Monetarists, are partial to adjusting interest rates and fiscal stimulus in order to restore the economy. The Great Depression of the 1930s is often used today as a point of reference to learn from failed protectionist policies. Black Tuesday, October 29, 1929 marks the horrifying beginning to the Great Depression with the most devastating collapse in the stock market until the recent crisis. The U.S. government passed the Smoot-Hawley Tariff Act of 1930 in reaction to the financial crisis. The act raised tariffs on over 20,000 imported goods to the second highest levels in AmericanShow MoreRelatedModern Egyptian Economy1526 Words   |  6 Pageswitnessing a series of economic and political reforms since the beginning of the 21st century. Starting from post-Gamal Abdel-Nasser’s era in 1990 several economic reforms and monetary policies have been implemented by the Central Bank of Egypt (CBE) and other economic institutions. The economic reforms started by the Economic Reform and Structural Adjustment Programme (ERSAP), offered by the International Monetary Fund (IMF), in 1991 wit h the aim of amending the economic imbalance of demand andRead MoreThe Asian Financial Crisis and Thailand: Catalyst for Change...or More of The Same? 1647 Words   |  7 Pagessustaining rapid economic growth. 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