Impact of Government Policy on Economy

Topics: Government, Policy, Economic policy Pages: 8 (2592 words) Published: October 28, 2010
Generally, policies and strategies of Nigerian government towards development are shaped by two principal objectives of desire for economic independence and the demand for economic development. Multi national corporations are expected to bring into Nigeria, foreign capital in the form of technical skills, entrepreneurship, technology and investment fund to boost economic activities thereby, rising the standard of living of Nigerian. This can be tagged as foreign economy policy B. WHAT IS POLICY?


Policy is typically described as a principle or rule to guide decisions and achieve rational outcome(s). The term is not normally used to denote what is actually done; this is normally referred to as either procedure or protocol. Whereas a policy will contain the 'what' and the 'why', procedures or protocols contain the 'what', the 'how', the 'where', and the 'when'. Policies are generally adopted by the Board of or senior governance body within an organization where as procedures or protocols would be developed and adopted by senior executive officers.

Government is the organization, or agency, through which a political unit exercises its authority, controls and administers public policy, and directs and controls the actions of its members or subjects. Typically, the term "government" refers to the civil government of a sovereign state which can be local, national, or international. However, commercial, academic, religious, or other formal organizations are also governed by internal bodies. Such bodies may be called boards of directors, managers, or governors or they may be known as the administration (as in schools) or councils of elders. The size of governments can vary by region or purpose. Growth of an organization advances the complexity of its government, therefore small towns or small-to-medium privately operated enterprises will have fewer officials than typically larger organizations such as multinational corporations which tend to have multiple interlocking, hierarchical layers of administration and governance. As complexity increases and the nature of governance become more complicated, so does the need for formal policies and procedures. The impact of government policy on economy with reference to Nigeria policies can not be overemphasized. For this write up I shall zero it down to important sectors in the Nigerian economy that is the down stream sector and agricultural sector of the economy for these two sectors are very important and they are pivots to which all other sectors of the Nigerian economy hang. The main issues in this paper relates to understanding the effects and impact of government policy on the Nigerian economy as well as our ability to attract adequate amounts, sufficient enough to accelerate the pace of our economic growth and development. The need for holistic approach to economic policy is born out of the underdeveloped nature of the Nigeria’s economy that essentially, hindered the pace of her economic development. There are four basic requirements for economic development namely.

i)Investment capital
ii)Technical skills
iv)Natural resources.

Without these components, economic and social development of the country on economy policy would be a process lasting for many years. The provisions of these first three necessary components present problems for developing countries like Nigeria. This is because of the fact that there is a low level of income that prevents savings, big enough to stimulate investment capital domestically or, to finance training in modern techniques and methods. The only way out of this problem is through acceleration of the economy by external sources of money (foreign investment) and technical expertise.


1. Increase in fuel price policy and Nigeria...
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