Stabilisation Policy : The Pursuit of Internal Balance

Abstract

In the first chapter of the book we discussed the four generally accepted objectives of macro-economic policy, namely internal balance, external balance, price stability and a high rate of growth. There we confined ourselves to defining these objectives and indicating the reasons why they are regarded as desirable not only in Britain but in all advanced industrial countries of the Western world. With the theoretical equipment acquired in the preceding four chapters we can now proceed beyond these preliminary questions to the central question of how these four objectives can be attained. In the present chapter we shall use this equipment to consider the problems involved in the attainment of the internal balance objective and in the next chapter we shall use it as a basis for discussing the achievement of external balance. The price-stability objective will be discussed in Chapter 10, after some additional theoretical material has been presented, and the growth objective in Chapters 11–12.