As a result, these individuals believe that the best approach is to limit the role of the government during this process. (Anand, 2011) (Hall, 2009) There is No Such Thing a True Free Market Economy

Despite the claims made about the benefits of a free market economy, many opponents will argue that this simply does not exist. The reason why is because the government will always play a role in regulating the practices of businesses. This will occur through protecting the interests of the general public and their ability to control business practices (through policies such as taxation). As a result, the government will play a central role in preventing obvious abuses from occurring inside the marketplace. (Anand, 2011) (Hall, 2009)

During a recession, this means that they can help to stimulate the economy. The way that this occurs is to provide additional amounts of working capital. This means that businesses and consumers will have increased access to credit. At...

When this happens, any kind of negative downward spiral that is fueled by the recession will be mitigated. (Anand, 2011) (Hall, 2009)
Moreover, the government can limit certain practices which help to create huge boom and bust cycles. This means that there will be responsible practices utilized by various firms when interacting with the general public. Over the course of time, this will require everyone following these standards and preventing large asset bubbles from developing. This is showing how there are different views about the underlying causes of recessions and what kinds of solutions should be utilized to address these challenges. (Anand, 2011) (Hall, 2009)

References

Anand, S. (2011). Essentials of Dodd Frank. Hoboken, NJ: Wiley.

Hall, R. (2009). Macroeconomics.…