TITLE

Comments and Discussion

AUTHOR(S)
Baily, Martin Neil
PUB. DATE
June 1981
SOURCE
Brookings Papers on Economic Activity;1981, Issue 2, p368
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
This article focuses on issues concerning the economic policy and performance in Great Britain. Analysis of the economic events of 1979 to 1981 within a sticky wage and price framework and the basic argument about what went wrong is fairly straightforward wherein monetary and fiscal policy reduced the level of nominal demand. Since wages and prices were sticky, this translated into a decline in real output, an increase in unemployment, and a moderate abatement of inflation. Willem Buiter and Marcus Miller argues that the narrow M1 measure of money is better than the broader M3 measure (used by the government in its setting of targets) and hence that the sharp deceleration of M1 growth indicates a tight policy but it is believed that the key to the British experience is the surge in the price level wherein the most striking fact is the decline in the real money stock by all measures, by refusing to accommodate the change in the price level, the government in a sense acquiesced in a very tight monetary policy. The role of the foreign trade sector and the exchange rate in the decline of output and employment is interesting wherein the value of sterling rose sharply compared with the major trading partners of Great Britain. Since wages were also rising rapidly, the result was that the index of relative unit labor costs of the International Monetary Fund for Great Britain was up 40 percent in 1980 over 1978. Somewhat surprisingly, this dramatic change in competitiveness did not show up very strongly in import or export volumes.
ACCESSION #
17398568

 

Related Articles

  • Is Italy Worth Saving? Strumia, Max Maurice // Saturday Evening Post;2/8/1947, Vol. 219 Issue 32, p30 

    The article presents the author's experience in visiting his homeland, Italy. The author's first encounter was in the restaurant wherein he asked the waiter about the form of government he wants. He met a prisoner from Germany and they have a conversation about the economic conditions. On the...

  • INCOME POLICY AND THE PRICE SYSTEM. Taylor, George W. // Monthly Labor Review;Aug71, Vol. 94 Issue 8, p45 

    Examines the appropriate income policy and price system for the U.S. as of 1971. Recurrence of inflation; Public demand for wage and price controls; Productivity wage increases; Determination of private wage and price; Inflationary bias.

  • Where Is Industrial Relations Headed? Marshall, Ray // Labor Law Journal;Aug77, Vol. 28 Issue 8, p453 

    The article highlights the state of affairs in the field of U.S. industrial relations. Limitations of the incomes policy of wage and price controls; Need to reduce unemployment to manageable levels; Aspects of international dimensions in the field of labor.

  • WASHINGTON FRONT. Parsons, Wilfrid // America;6/5/1943, Vol. 69 Issue 9, p228 

    The author reflects on the principal job of the U.S. Congress that includes taxes and wages and prices. It notes that the government starts the enterprise and awards the contracts. Among the disadvantages of this system include that most of the contracts were too high, the country's income...

  • National living wage 'will hike prices and hasten automation'. Devlin, Edward // Grocer;2/20/2016, p11 

    The article reports on the new law made in Great Britain to raise legal minimum wage for workers aged 25 and above. It states that this law will cause rise in the prices by food and drink manufacturers due to increased labor cost. It mentions that around 26 percent of manufacturers will raise...

  • Living wage could make British strawberries "unaffordable". Perkins, Carina // Grocer;12/12/2015, p35 

    The article discusses farm business consultant Andersons' report which warned that the National Living Wage which will be implemented in Great Britain in 2016 could render strawberries an unaffordable luxury and impact fruit and vegetable growers.

  • UNIONISM AND THE DISPERSION OF WAGES. Freeman, Richard B. // Industrial & Labor Relations Review;Oct80, Vol. 34 Issue 1, p3 

    This study examines the effect of trade unionism on the dispersion of wages among male wage and salary workers in the private sector in the United States. It finds that the application of union wage policies designed to standardize rates within and across establishments significantly reduces...

  • A Simple Economic Analysis of Vehicle Quota Premiums. Tay, Richard // Singapore Management Review;Jan1994, Vol. 16 Issue 1, p1 

    The rationale for imposing a vehicle quota is laudable as land in Singapore is very limited. 11 per cent of it has already been allocated to land transport use and infra-structures cannot be increased rapidly enough to cope with an unrestricted growth in traffic. Thus, some restraints on vehicle...

  • THE KENNEDY-JOHNSON "GUIDEPOSTS" POLICY.  // Congressional Digest;Oct70, Vol. 49 Issue 10, p228 

    Examines the wage-price guide posts established by the U.S. Federal Government. Aim of the strategy to control and maintain wages and prices through negotiation, exhortation, publicity, or government pressure; Need for the wage rate increase in industries to equalize with the trend rate of...

Share

Read the Article

Courtesy of VIRGINIA BEACH PUBLIC LIBRARY AND SYSTEM

Sorry, but this item is not currently available from your library.

Try another library?
Sign out of this library

Other Topics