Employment Policies Of The Health Sector Essay

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Economics Internal: AS91227 Credits: 6 By Harrison Brown Part 1 Employment Policies Policy 1 Increase spending within the health sector The health sector in NZ requires attention as New Zealand needs an increase in the amount of hospital buildings and services so that it is more convenient and most families will have a hospital close by. Having the government increase it’s spending in the health sector would increase the (G) part of the AD equation which stands for government spending meaning the government is spending its own revenue in the health sector to improve its services to the public. In the short term builders will be employed to build the hospitals in the first place and will raise employment. In the long term hospital staff such as nurses, doctors and chefs will be employed and will be placed into the up and coming hospitals which therefore increases employment of New Zealand. The effect an increase in government spending within the health sector will cause to the AD/AS model is that the AD curve will shift to the right. Aggregate demand increases to the right which is shown on the graph below as AD to AD1. This occurs because government spending is the (G) part of the AD equation. Since aggregate demand has increased this will also increase Real GDP from Y to Y1 which results in an increase in growth. Employment is increase from the increase of growth because the increased in AD causes the equilibrium to shift closer to the full employment line shown as Yf
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