Macro-Economic Policies Essay Example | Topics and Well Written Essays - 1500 words

Macro-Economic Policies - Essay ExampleAt the heart of this conflict is not entirely the politics of Royal and Sarkozky, or the pitting of ideals of the Socialists against the Rightists, but also the more crucial macro sparing issues the demesne face, the extent of the g everyplacenments efforts to provide solutions to these quandaries and the future political and economic stability of the country. It is therefore, crucial to understand the major macroeconomic issues which plague France as a nation and evaluate the actions and the success the government has taken in fix to achieve economic stability.One of the key issues, which challenge the nation in recent decades, is the high place of unemployment. The French government in the past has taken diverse come along and initiatives to spur growth and employment. However, the approach was not feasible to provide solutions to the problem of rising unemployment rate (OECD, 2007). The OECD has encouraged the French government to give forward measures that could advance structural changes in the economy. The organisation has identified three main problems the government take up to recognise a) guarantee medium-term financial viability and develop the tax system structure to augment benefits and minimize expenditure, b) put employment rate among low-skilled workers and focus on particular groups through the restructuring of the labour market institution, c) improve the first step of growth and jobs creation through further economic reforms which in turn encourage competition (OECD 2007). In addition, the current French policy and procedures for the firing of workers especially permanent labourers are more intricate compared to the pink slip of temporary workers. If a firm wants to dismiss a permanent worker, it has to provide legal justifications which are overly rigorous to follow. Thus, redundant workers become a burden and liability of the company as the firms themselves are get to help dismissed workers f ind employment (OECD 2007). This hinders the majority of companies in France to provide permanent contracts to their employees, adversely bear on the job prospects of the youth and the unskilled. In the recent years, the government has come up with a solution by introducing a special contract called the Contrats Nouvelles Embauches which gives companies - those which do not have more than 20 workers - the flexibility to quit the contract in the span of two years. However, the contract requires firms to disburse high severance payments (OECD 2007).Another economic dilemma France struggle to hurdle is the public sector famine. Although the government has been successful in curbing deficit in the past couple of years, France is not ready for the long-term effects of indiscreet expenditures on health and pension resulting from the ageing of the population. Hence, despite the significant reforms the government has already achieved, OECD recommends that the ratio of public debt to GDP be reduced. GDP or Gross Domestic Products refers to the value of all the goods and services produced within a estate or a country in a particular period of time. This is also the sum of consumption, investments as well as other various elements such as governments expenditure and export/output. Frances GDP wisecrack widened over the year as compared to government expenditure but GDP growth has becoming stronger over the years moving from 1 percent a year from the year 2000 to about 2 percent