Britain's Economic Performance after WW2
Britain's Trade and Finance after WWIIThe war, which broke out in September 1939, like the First World War, raised a host of supply problems, which could not be resolved satisfactorily by market forces alone. Once more, Govnerment had to take steps to control the economy and limits had to be placed on personal liberty. From May 1940 the country was governed by coalition of Conservatives, Labour and Liberals under Churchill, and Labour ministers played a prominent part. Since many controls were continued after the war ended in 1945, the war and immediate postwar years can be seen as a single period from the point of view of economic policy. The United Kingdom defaulted on its war debts to the United States in the post-1931 crisis, and Congress had passed the Johnson Act in 1934, which forbade new loans to government in default. As a result, Britain's gold and dollar reserves were at first controlled carefully in the hope of making them last for the three-year war which Anglo-French war planners envisaged. Whichever party had won the 1945 election would have faced tremendous external constrains on its policies. Britain's overseas liabilities (excluding Lend-Lease) had increased from $542 million in June 1939 to $3354 milli
This particular pattern of specialization is of course similar to that found in France and the US. IN manufacturing, productivity has continued to increase, largely due to a tax regime that supports and encourages capital investment and innovation. 13) Industrial manpower was in short supply partly because of the greatly increased size of the armed forces. The collapse of the system of stable exchange rates relaxed a major constraint to domestic monetary expansion at a time when commodity prices were rising after 20 years of comparative stability. (Country Commercial Guide, 2000)The labour government with Tony Blair at the reigns allows market forces rather than social programs to drive the economy. Table 1 1950 1960 1973 1979 1990US 148 135 139 141 136Germany 65 98 110 119 116France 74 84 106 114 111Japan 27 44 91 95 112UK 100 100 100 100 100 Source: Maddison (1987) for 1950-73; OECD National Accounts, Vol. Increased public expenditure would have been the appropriate Keynesian remedy had the fall in GDP been a result of a lack of domestic demand, but an expansion of domestic demand, and rising money incomes, could not compensate for the transfer of real purchasing power abroad through the rise in import prices. In 1974 and 1975, GDP at constant factor cost fell for the first time since 1946, by 3. Foreign exporters, investors and management companies participate in public sector and private sector ventures and partnerships in virtual equality to British firms, and have established a route via Britain to the European single market. Real GDP growth is forecast to remain below 2% in 2001. It indicates a number of important features in the post-war period. She spoke warmly of Victorian values, such as self-help and enterprise, and, indeed, she is perhaps unique among prime ministers in having given her name to a comprehensive set of economic and social ideas. (Paul Temple, 1994)Catch-Up The relative position of the UK in 1990 is the outcome, over a long period of time, of a process of economic growth.
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Acceptance Essays
