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The UK Monetarist Experiment

Published online by Cambridge University Press:  28 November 2008

P. Arestis
P. Arestis
Affiliation:
Economics DivisionThames Polytechnic
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Abstract

The paper argues that the monetarist ‘experiment’ of the first Thatcher government in Britain (1979–83) has been unsuccessful. Alternative monetarist philosophies and their specific application to Britain are outlined. These propositions are then re-examined in the light of the actual experience of economic policy in Britain, and are found to be inadequate. Inflation in Britain has come down, but ironically after a period when money supply grew quickly – well above the government's target ranges. Unemployment has also risen much more severely than monetarists predicted. ‘Monetarism’ in Britain can be interpreted less in terms of theoretical and empirical economic analysis as in terms of value judgements about the size of the public sector and about paying a high cost in unemployment to stabilise prices.

Type
Articles
Information
Journal of Public Policy , Volume 4 , Issue 1 , February 1984 , pp. 39 - 56
Copyright
Copyright © Cambridge University Press 1984

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