The Macroeconomics of Industrial Strategy
This paper explores some of the links between macroeconomic policy and industrial strategy. The perspective of the present paper is to emphasis the role of the output and investment activities of enterprises rather than the general focus on the labour market in the determination of economic performance. We have explore this aspect in some detail in connection with the inflation barrier, and argue that such a barrier should be viewed in terms of a lack of capacity. We briefly review the balance of trade constraint on growth and employment. The over-all implications of those two sets of analyses is that macroeconomic performance would be enhanced by appropriate industrial strategy, and that inappropriate macroeconomic policies will damage industrial performance. Policies designed to restrain inflation by lowering the level of aggregate demand will tend to depress investment and harm capacity. Improved industrial performance requires a climate conducive to investment and research and development, which in turn depends on, inter alia, high and stable levels of aggregate demand.
|Date of creation:||11 Aug 1998|
|Note:||Type of Document - Acrobat PDF; prepared on IBM PC - PC; to print on PostScript; pages: 22; figures: included|
|Contact details of provider:|| Web page: http://econwpa.repec.org|
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- J. S. L. McCombie & A. P. Thirlwall, 1997. "The Dynamic Harrod Foreign Trade Multiplier and the Demand-orientated Approach to Economic Growth: an Evaluation," International Review of Applied Economics, Taylor & Francis Journals, vol. 11(1), pages 5-26.
- Dixon, H. & Rankin, N., 1991.
"Imperfect Competition and Macroeconomics: a Survey,"
The Warwick Economics Research Paper Series (TWERPS)
387, University of Warwick, Department of Economics.
- Dixon, Huw David & Rankin, Neil, 1994. "Imperfect Competition and Macroeconomics: A Survey," Oxford Economic Papers, Oxford University Press, vol. 46(2), pages 171-199, April.
- Dixon, Huw David & Rankin, Neil, 1992. "Imperfect Competition and Macroeconomics: A Survey," CEPR Discussion Papers 636, C.E.P.R. Discussion Papers.
- Kaldor, Nicholas, 1972. "The Irrelevance of Equilibrium Economics," Economic Journal, Royal Economic Society, vol. 82(328), pages 1237-1255, December.
- Philip Arestis & Iris Biefang-Frisancho Mariscal, 1997. "Conflict, Effort and Capital Stock in UK Wage Determination," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 24(3), pages 179-193, October.
- Philip Arestis & Peter Skott, 1993. "Conflict, Wage Determination, and Hysteresis in U.K. Wage Determination," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 15(3), pages 365-386, April.
When requesting a correction, please mention this item's handle: RePEc:wpa:wuwpma:9808002. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (EconWPA)
If references are entirely missing, you can add them using this form.