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Under a contractionary taxation policy, the government tries to improve its finances by

Bethany Evans

in Business

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Theresa Perry on February 3, 2018

Governments are engaging in contractionary fiscal policy by increasing taxes or reducing government spending. In its crudest form, these policies are designed to extract money from the private economy, with the hope of curbing the unsustainable production or the reduction of the prices of the assets.


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