What is the main focus of supply-side economics?

The primary focus of supply-side economics is boosting economic growth by increasing the supply of goods and services. This economic theory posits that lower taxes and fewer regulations will stimulate production (or supply) within an economy. By incentivizing businesses to invest, expand, and create jobs, supply-side economics seeks to enhance the overall economic capacity.

When businesses have more resources and fewer constraints, they are more likely to produce goods and services efficiently, which can lead to economic growth, innovation, and ultimately, job creation. This approach emphasizes the idea that when producers (businesses) thrive, it results in benefits for the entire economy, including consumers who can enjoy more products and lower prices due to increased competition and supply.

In contrast, the other options focus on different economic strategies that do not align with the core tenets of supply-side economics. For instance, increasing taxation to fund public services tends to be associated with demand-side economics, which emphasizes consumer spending. Establishing price controls could distort market dynamics and is typically not a component of supply-side theory. Lastly, while increasing consumer spending through subsidies can stimulate demand, it does not directly address supply-side principles that focus on producers and overall economic capacity.