Question

What are the differences between the economic theories and the reality of policy implementation?

How have market outcomes changed over time as a result of the policies?

Answer 1

Economic theory that determines the framework of an economy. But it is not necessary to behave the economy as the model does. According to the model, we should implement it completely, but if the circumstances of the country are not according to that model then it can be a big challenge, in this type of situation it. is very tough to implement the policy.

Where an economic theory shows the upper picture of a country's economy, when it comes to the implementation of policy, it shows the surface picture of small corners of the country which is the root of the real problems there.

Outcome of a market changes the policy there because the policy changes according to the circumstances, so if the market income is bringing positive or negative changes in that economy then the policy of that economy will be made keeping in mind the same changes, for example, in the United States, many policies were created for the labor market and its result was that the labor market has emerged strong, so now these changes will change the US labor market policy with it.