As the world's economies continue to fluctuate due to changes in economic conditions, macroeconomics is an important topic to examine in light of this fluctuation. The macro-environment legislation and economic climate are interrelated and often can only be understood if a proper analysis of both these areas is carried out. In addition to the macro-environment legislation and the macro economy, macroeconomic policies have a direct bearing on the macro-environment legislation as well.
The macro-environment legislation includes all governmental legislation that affects the macro environment and the macro economies. This includes laws relating to taxation, tariffs and import duties, banking, insurance, trade, finance and commercial organizations. It also includes legislation affecting the macro economies such as labor market laws, trade barriers, and the structure of international trade.
Government agencies responsible for regulating economic conditions include government agencies such as the Federal Reserve and central banks throughout the world, including the Bank of England, European Central Bank, Federal Reserve Banks of Canada and New York, International Monetary Fund, and even the Bank of Japan. These agencies are charged with ensuring that the world's economies operate smoothly and within the confines of the law. They are also charged with the responsibility of ensuring that economic activity is not damaging to other areas of the world as well.
Macroeconomic policies are set in motion at a political, regulatory and institutional level. These policies affect individual businesses, organizations and markets as well as the global economy as a whole. Policies affecting the macro economy often lead to policy changes and economic fluctuations on an individual level as well.
Macroeconomic policies are also a form of government intervention and interventionism in economic terms. There are many types of interventions in the macro-economy as well as the global economy in general; they include:
The economic climate refers to the state of the macro environment. It includes the state of the economy in relation to the macro-economy and all governmental regulation and legislation affecting the macro environment. The macro environment also includes all aspects of international trade, including the laws that regulate the entry and exit of goods into and from the national economy. These laws also influence the macro environment and the macro economy.
The macro environment is a complex phenomenon and there is no single, simple explanation for its existence. Some economists suggest that the macro environment is governed by a system of 'laws of physics' that govern the functioning of the entire economy. Others suggest that it is governed by the natural forces of economics which are the effects of economic decisions, such as interest rates, demand, supply and price, unemployment, monetary policy, and the state of the world's financial system.
In general, the economic climate is affected by the actions of governments, international trade agreements, and the macro economy in general. In many cases, the effects of a single change in the macro environment can dramatically affect an economic climate. Changes in the macro environment can lead to major shifts in global trade and international politics.