Supply side refers to policies aimed at increasing production and expanding aggregate supply in order to achieve long-term economic growth. These policies typically focus on reducing barriers for businesses, such as regulations and taxes, in order to encourage investment, innovation, and productivity.
Related terms
Aggregate Supply: Aggregate supply represents the total amount of goods and services produced by all firms in an economy over a specific period of time. It is influenced by factors such as labor, capital, technology, and government policies.
Tax Incentives: Tax incentives are special deductions or credits offered by the government to encourage certain behaviors or investments. In the context of supply side policies, tax incentives can be used to motivate businesses to invest in new equipment or research and development.
Deregulation: Deregulation refers to removing or reducing government regulations that restrict business activities. By cutting red tape and simplifying rules, deregulation aims to make it easier for businesses to operate and innovate.