Markets and Policy
Markets and policy are inherently interconnected: government policies influence private agents’ decisions (e.g., consumption, investment, financial decisions), which in turn also help shape government policies. Business cycles significantly influence the public awareness of this interconnection, and the recent financial crisis has been a clear example both of how it operates, but also of its potentially harmful economic and social consequences. This complex and intricate relationship extends well beyond the microeconomic level (individual decisions) to the macroeconomic level (aggregate decisions), having consequences for economies and societies.