Research On The Adjustments In The Macro-economic Policies In The United States In The 1980s

Thus far, economic recovery is proceeding broadly as expected, but the uncertainty still remains. Most advanced economies and a few emerging economies still face large adjustments. Their recoveries are proceeding at a sluggish pace, and high unemployment poses major social challenges. By contrast, many emerging and developing economies are again seeing strong growth, and facing the problem of inflation. Based on the research of the policies which the Reagan administration took in order to promote economic growth and curb inflation in the United States in the 1980s, this paper wants to provide some enlightenment of the future policy tropism for different economies.This paper consists of four parts. The first part is the introduction. This part mainly expounds the significance of the paper, summarize the existed studies, and also describe the main innovation points and deficiencies. The second part forecasts on the future direction of the economy based on the research on the current situation, then summarizes the policies which administrations have took to fight against the Financial Crisis, and finally describes the guideline of the policies in the future. The third part reviews the adjustments of the macro-economic policies in the United States in 1980s. First, this part studies the background of the adjustments, and then finds its theoretical roots. In the end of the third part, this paper summarizes the policy measures which the Reagan administration took and testes its effectiveness. The last Part describes the enlightenment of the adjustments of the macro-economic policies in the United States in 1980s. Because the advanced economies and emerging economies will face different economic problems in the future, thus this paper makes recommendations on the future policy orientation respectively. Then this paper compares the current economic situation in China with the economic situation in the United States during 1960s and 1970s, and gets inspiration in the aspect of the policy tropism from the results.In the 1970s, the United States sank in the mire Of the stagflation. Thanks to the failure of the Keynesian policies, the Reagan Administration dealt with the economic stagnation mainly through the supply-side economics fiscal policy and curbed inflation by the monetary policy which the monetarists advocated, with using the high interest rate policy to coordinate them. Finally, these measures succeed in solving the problem of stagflation. Based on the analysis of the Reagan economic policies, the paper get the main inspirations as follows:(1) The key to the future policy in the advanced economies is to promote economic growth, so tax-cuts and strengthening the market mechanism are needed. They also should pay attention to the deficit and foreign economic policy choices; (2) The emerging economy and the developing country mainly face the risk of inflationary pressures, so they should pay attention to when and how to make exit plans, and also should be careful about the use of "double-tight" policy; (3) In the future, China can take tax-cuts measures and keep fiscal deficit in moderate degree. In the aspect of the monetary policy, it's time for China to consider to shift the ease monetary policy to a tight one. To meet the need of the industry restructure, the government may take some actions to reduce intervention appropriately. To be added, the coordination of the policy at home and abroad is needed, and China can properly make the exchange rate more flexible.