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Chapter I. The Economy in 1979

Published online by Cambridge University Press:  26 March 2020

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Extract

The United Kingdom economy remained almost stagnant in 1979 with GDP being only 0.6 per cent higher than in 1978. Not only is this a dismal end to a generally depressed period of seven years but the outlook for the beginning of the 1980s is even worse, as we discuss in chapter II on the home economy. In comparison with the United States, Japan, West Germany, France and the OECD countries as a whole the UK performance has been slow, as is clear from chart I. However if similar comparisons with the other countries had been made in 1969 or 1959 the UK performance would also have been seen to be relatively slow. This picture of a stagnant aggregate economy in 1979 covers up an underlying picture of considerable fluctuation in the components of the economy.

Type
Articles
Information
National Institute Economic Review , Volume 91 , February 1980 , pp. 8 - 26
Copyright
Copyright © 1980 National Institute of Economic and Social Research

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References

Notes

(page 10 note 1) See National Institute Economic Review, No. 84, May 1978, p.7.

(page 11 note 1) This is on an accruals basis; taking account of the lag in payment of VAT to the exchequer, the accruals adjustment (necessary to calculate the public sector borrowing requirement) was forecast to increase by £0.66 billion, so that in payments terms the net decrease in receipts was estimated as nearly £1 billion.

(page 11 note 2) R. W. R. Price ‘Public expenditure: policy and control’, National Institute Economic Review, No. 90, November 1979.

(page 11 note 3) In February (Hansard, 23 February 1979, col. 334-5) the Chief Secretary to the Treasury announced that the cash limits would be consistent with an 8½ per cent increase in the retail price index between the fourth quarters of 1978 and 1979. The 7½ per cent figure is deduced from the Chief Secretary's Memorandum on the Supply Estimates, 1979/80

(page 16 note 1) National Institute Economic Review, No. 88, May 1979.

(page 24 note 1) Overseas investment in UK private sector less UK private investment overseas.

(page 24 note 2) This discussion is deliberately abbreviated as chapter IV is devoted to ‘Industrial Production’.