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Chapter II. the World Economy

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  • R.J. Barrell
  • Andrew Gurney

Abstract

GNP growth in the major seven economies continues to decline from the cyclical peak reached in 1988. The latest national accounts statistics show that all major seven economies are now growing more slowly than they did last year, with the United States, United Kingdom and Canada in recession. This slowdown in activity appears to have been caused primarily by the tightening of monetary policy that occurred between 1988 and 1990. Short-term interest rates rose by 4.4 percentage points in Germany between 1987 and 1990, by 3 percentage points in Japan between 1987 and 1990, and by 2.2 per cent in the United States between 1987 and 1989.
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Suggested Citation

  • R.J. Barrell & Andrew Gurney, 1989. "Chapter II. the World Economy," National Institute Economic Review, National Institute of Economic and Social Research, vol. 127(1), pages 26-45, February.
    • Handle: RePEc:sae:niesru:v:127:y:1989:i:1:p:26-45
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