The international community understands the challenges and financial consequences of the sharp decline in commodity prices and knows that commodity prices play an important role in enhancing economic development in most developing countries. Examining and analyzing the interactions between commodity prices and the business cycle of commodity exporters is important for all countries that participate in or have interests in international trade. This is because it will raise questions such as: what drives the business cycle in commodity economies and how should policymakers respond to the crisis due to falling commodity prices? Due to the recent volatility in commodity prices and the dramatic drop in oil prices, this has caused much concern in the international community. According to (IMF, 2015 A Fiscal Framework for Uncertain Times), 17% of global GDP comes from countries with more than 20% of exports of non-renewable raw materials. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an original essay The Norwegian government knows and understands the importance of the business cycle and commodity prices. We have taken it upon ourselves to improve, control and well manage the economy of the Norwegian people, where the indication of both material and immaterial well-being is at high levels. The intelligent way of using wealth from all resources, such as oil, and the effective use of monetary policy within flexible inflation have protected the Norwegian economy and supported its recovery. The Norwegian economy has maintained commodity prices thanks to its commitment to implementing growth-supporting policies. , such as the development of a system heavily dependent on the trade of raw materials, with oil representing 20-25% of GDP and around 50% of total exports, ensuring price and financial stability. We also avoid procyclicality in fiscal policy, ensuring fiscal efficiency and public spending. Once again, Norway was successful in its economic stabilization policy and for this reason it gained considerable international interest. This applies in particular to the management and spending of oil revenues. Furthermore, the Norwegian salmon farming industry has seen a regular boom in both productivity and value since its inception in the 1970s. The increase in productivity has caused the price of salmon to follow a long-term downward trend. Regardless of a smooth increase in production control, industry profits are still sensitive to shocks to stocks due to disease, fish escapes, algae influx or temperature changes. Please note: this is just an example. Get a custom paper from our expert writers now. Get a Custom Essay The Norwegian government has developed policies such as fiscal policy and the state pension fund to mitigate the effects that business cycles and commodity recessions might have on an economy's systems and to define the Norwegian economy both in short and long term.