After Monetarism: What Next?

Abstract

Few governments have come to power in Britain with greater hopes of creating an economic miracle than the Conservative one of 1979. Inflation was to be squeezed out of the system; the gargantuan public sector was to be cut back so that the wealth and job-creating private sector could be expanded; taxes were to be cut to give everyone an incentive to work harder and businessmen an incentive to start new firms; tax cuts were to rekindle the spirit of enterprise on which our economy had been built; and control of the money supply would cure inflation. At last, a start would be made on curing Britain’s long-term, deep-seated economic problems — inflation, low productivity and a lack of competitiveness.