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The political dimension in PESTEL analysis refers to the impact of government policies, regulations, and political stability on a business. It can include factors such as tax policies, fiscal policy, trade tariffs, political stability and instability, corruption levels, and political ideology of the ruling party. These factors can greatly influence the business environment and the potential success or failure of a business. For instance, a change in government can lead to policy changes that could either benefit or harm the business. Similarly, political instability can create uncertainty, making it difficult for businesses to plan for the future.
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Because trends can be hard to quantify, it helps to have a framework that organizes them into categories. And this is where the PESTEL analysis comes in, or sometimes its also spelled as PESTLE or simply PEST. PESTEL is an acronym that stands for Political, Economic, Social, Technological, Environmental, and Legal. This suggests a more structured way to break down and assess the vast spectrum of macro environmental factors. Now, let's go through each of these components.
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How to respond to the current economic shifts of tariffs and geopolitical changes? Use this Macro Environment Analysis deck to examine the frameworks ...
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