Economic policy pursued in a particular state is very important to ensure the achievement of the goals facing society and the authorities. The methods of state regulation, as well as special tools, most often referred to as means, help to fully realize it.
Economic regulation tools can be divided into the following groups:
1. Monetary policy:
- refinancing policy (discount rate of interest);
- policy of minimum reserves (required minimum reserves);
- open market policy.
2. Fiscal policy :
- government spending policy ;
- government revenue policy .
The subjects of economic regulation are all those who implement economic policy - this may be the state, regional, local institutional formations, as well as non-governmental unions and associations.
Many schools defined differently what is included in the concept of an object and what methods of state. regulation exist. I would like to take a closer look at the rather popular system of views of ordoliberals, which is most often found in educational literature.
They referred to objects as reproduction conditions, regions, sectors of the economy, territory, situation, foreign policy environment, as well as economic interests of the subjects.
Methods of state regulation were divided, firstly, into general and private. The first group includes the following:
- method of scientific abstraction;
- analysis and synthesis;
- a systematic approach.
The second group is represented by such methods as extrapolation, economic groups, as well as budget (balance).
In addition to such a classification, there is another one in which the methods of regulating the economy are divided according to direct or indirect impact. The direct assumes that all the ways of the subjects regarding the adoption of economic decisions are deliberately outlined by the state, and their behavior must comply with certain guidelines.
These include control over the financial operations of enterprises, setting prices and tariffs, and determining production tasks.
Indirect methods of state regulation are less stringent, they tend to direct the subjects in the right direction. The point is not to force one to do so, and not otherwise, but to create such conditions under which a voluntary decision would be beneficial to society and consistent with the goals of economic policy, i.e. there is an impact on economic interest.
Indirect methods include those state. regulation:
- Bankruptcy Prevention (Legislative).
- Market (anti-crisis, anti-inflationary policies).
- Fiscal policy.
- Monetary policy.
Also, regulatory methods are presented as advisory, in which the state sets as its main task the facilitation of the functioning of the economy; institutional related to the formation of institutions (market), as well as vertical and horizontal management.
Of course, the use of certain methods depends on the country itself, the political regime, as well as many economic factors. In developed countries, they rarely resort to direct, administrative methods of influence. However, in extreme conditions, for example, during wars or serious crises, such methods of state regulation are not left without attention.
It is worth making a remark that even advanced countries in many cases do not neglect government intervention, combining indirect and direct methods, which under certain conditions leads to a positive effect.
It cannot be said that some methods are bad and some are good. Depending on the political, economic and social situation in the country, the state gives preference to one or another influence, sometimes applying a combined effect.