 The balance of payments constraintMaurice Scott and Robert A. Laslett Chapter 6 in Can We Get Back to Full Employment?, 1978, pp 68-71 from Palgrave Macmillan Abstract: Abstract The first of these quotations is a vivid description of the situation during the period of fixed exchange rates and full employment which lasted from 1950 to 1966. During these years it certainly seemed to be the case that macroeconomic policy largely consisted of expanding demand until our foreign exchange reserves came under pressure, and then of restricting demand until unemployment became uncomfortably high, by which time the pressure on the reserves had gone. So, once again, demand could be safely expanded until … This was the famous stop—go cycle. Viewed in retrospect, one wonders why we grumbled about it so much. Unemployment was kept very low, growth was, by our own historical standards if not by those of contemporary Western countries, high, and fluctuations in output were smaller than in many other countries. Hence, although the balance of payments did seem to limit our power to stimulate demand and reduce unemployment, the limitation does not now appear to have been a very serious one. Keywords: Exchange Rate; Foreign Trade; Full Employment; Macroeconomic Policy; Fixed Exchange Rate (search for similar items in EconPapers) There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-349-16020-4_6 Ordering information: This item can be ordered from DOI: 10.1007/978-1-349-16020-4_6 Access Statistics for this chapter More chapters in Palgrave Macmillan Books from Palgrave Macmillan |
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