Answer to Question #171692 in Economics for Mologadi

Question

Analyse the causes of a business cycle according to interventionists approach

Answer 1

Interventionist cluster policy: the government, along with fulfilling its directive function, takes over from the private sector the responsibility for making decisions on the further development of clusters and through transfers, subsidies, restrictions or regulation, as well as active control over firms in the cluster, forms its specialization.

From the point of view of this policy, economic cycles can be deliberately planned for the formation of a health-improving cleansing of the economy from enterprises. which for certain reasons are not viable.