Monetarism

This refers to a macroeconomic philosophy which emphasises the importance of controlling money supply in maintaining a stable economy.

A monetarist approach uses government intervention to control inflation; this approach assumes wages (typically a major cost element for most goods and services) are flexible with the level of unemployment being allowed to rise rather than increase labour costs.

Monetarism is a term normally found in business economics and financial management. Explore our learning zone to discover more