Economic policy and the financial and economic crisis

Abstract

The aim of this paper is to present and evaluate the theory and principles of economic policy applied before the 2008-2009 crisis1. Against this backdrop we will attempt to describe the evolution of targets and tools of economic policy in view of the experiences of recent years and the conditions of the globalization in this time. The first Section contains an outline of the world economic situation after 1945. Section two includes presentation and evaluation of the evolution of economic policy theory which co-created the conditions for world economic growth and stabilization in recent decades. The third Section describes macroeconomic mechanisms and conditions of economic policy directly preceding the 2007-2011 situation, and provides an analysis of the 2008-2009 crisis implications for the theory and future practice of economic policy. The paper is summed up in a conclusion.quantitative policy, qualitative policy, monetary policy, exchange-rate policy, financial and economic crisis, globalization