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Slow return to a British export led recovery?

Saturday, March 09, 2013
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Aggregate Demand may be stimulated by an increase in exports. Ha-Joon Chang, Author of the best seller, 23 Things They Don’t Tell You About Capitalism considers reasons in a short article for The Guardian why this hasn't happened after Sterling had fallen against other major trading economies. " Compared with ...2007, the pound has been devalued about 30% against the dollar, 50% against the yen, and 20% against the struggling euro. Yet despite the huge incentive to export created by such devaluation, Britain is still running trade deficits because it has lost the productive capacity to respond."

It  may help students consider plausible policies to reduce its trade deficit, a macroeconomic goal overlooked in arguments over  fiscal and monetary policies to control inflation or output. Finally it may aid evaluation, how different are the most pressing short and long term macroeconomic challengers facing UK governments.

Link to most trade figures.

 http://www.ons.gov.uk/ons/rel/uktrade/uk-trade/december-2012/stb-uk-trade--december-2012.html#tab-Economic-Context




 

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