Fiscal & Monetary Policies

1. Name: Hamad Al Mutawa
Grade: 12B

2. Table of Contents 2
Acknowledgement 3
Introduction 4
Globalization 5
What is Globalization 6
Impact of Globalization 7-8
Monetary Policy vs Fiscal Policy 9
What is Monetary Policy 10
What is Fiscal Policy 11
Objectives - Monetary Policy vs Fiscal Policy 12
Key Tools - Monetary Policy vs Fiscal Policy 13
Impacts on the real economy and Risks 14
Conclusion 15
References 16

3. In the world economy today, we see
• A shift away from self-contained national economies with high barriers to cross-border trade and
investment. Globalization has been the major force behind this.
• Monetary Policy vs Fiscal Policy is both important in their own terms. And with low inflation and positive
economic growth, they both help in creating a more stable economy.

4. I would like to express my special thanks of gratitude to my teacher Dr. Tarek Souheil who gave me the
golden opportunity to do this wonderful project on the topic Understanding Economics. Without his active
guidance, help, cooperation and encouragement, I would not have made headway in the project.
Secondly, I would also like to thank my mother who helped me a lot in finalizing the project within the
limited time frame.

6. • The way that people around the world have become more connected politically, economically, and
socially.
• It involves technological, economic, political, and cultural exchanges made possible largely by
advances in communication, transportation, and infrastructure.
What is Globalization?

7. Positive Impacts of Globalization
In recent decades the process of globalization has accelerated; this is due to a variety of factors, but
important ones include improved trade, increased labor and capital mobility and improved technology.

8. • Disparity in the society
• Ethical responsibility of business has been
diminished
• Unemployment
• The local business has perished
• Affected the agriculture sector
• Social Issues: Growth of fast-food chains brought
diet issues
• Loss of cultures (traditions, languages, clothing,
music, movies etc)
Negative Impacts of Globalization

10. • Monetary policy involves changing the interest rate and
influencing the money supply.
• Monetary policy is usually carried out by the Central
Bank/Monetary authorities and involves :
1. Setting base interest rates (e.g. Bank of England in UK
and Federal Reserve in the US)
2. Influencing the supply of money. (e.g. Policy of
quantitative easing to increase the supply of money).
What is a Monetary Policy?

11. • Fiscal policy involves the government changing tax
rates and levels of government spending to
influence aggregate demand in the economy.
• It is a sister strategy to monetary policy through
which a central bank influences a nation’s money
supply.
• They are both used to pursue policies of higher
economic growth or controlling inflation.
What is a Fiscal Policy?

12. Objectives
Fiscal Policy VS Monetary Policy

13. Key Tools
Fiscal Policy VS Monetary Policy

14. Impacts on the real economy and Risks
Fiscal Policy VS Monetary Policy

15. • Globalization has increased the trade of products, ideas, technologies etc. and created the world
without boundaries but it also had some negative impact on the developing countries.
• The main reason of confusion and bewilderment between fiscal policy and monetary policy is that
the aim of both the policies is same. The policies are formulated and implemented to bring stability
and growth in the economy. The most significant difference between the two is that fiscal policy is
made by the government of the respective country whereas the central bank creates the monetary
policy.
In conclusion:

16. https://kalkinemedia.com/definition/f/fiscal-policy
https://corporatefinanceinstitute.com/resources/economics/monetary-policy/
https://www.economicshelp.org/trade2/globalisation_uk_economy/
https://keydifferences.com/difference-between-fiscal-policy-and-monetary-policy.html