Is the British Economy supply constrained II

Report Title: Is the British Economy supply constrained II?

Published: 28/05/12

 British Economy


This report is a renewed critique of productivity pessimism” by authors Bill Martin and Bob Rowthorn follows two previous reports by Bill Martin, in April 20101 and July 20112. The new report brings fresh evidence to bear on the reasons why Britain’s labour productivity has fallen short and whether the economy’s capacity has been left severely impaired by the banking crisis.

The authors strongly challenge consensus estimates of the size of the economy’s spare capacity; the OBR’s estimate of the cyclical component of the budget deficit, and more generally the belief of supply pessimists that capacity constraints could derail anything more than a modest revival of demand.

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