Abstract
The term ‘stabilization policy’ normally refers to deliberate changes in government policy instruments in response to changing macroeconomic conditions, in order to stabilize the economy. It is often used to refer to the Keynesian policies which stemmed from Keynes’s General Theory: the new commitment of many Western governments after World War II to use policy to pursue high and stable employment. (An example is the UK White Paper on Employment Policy (Minister of Reconstruction 1944).) But other types of stabilization policies had been known previously (such as the return to the Gold Standard in the UK in 1925 in order to stabilize currency values (Moggridge 1986) and have been known since (such as the policy of monetary restraint carried out in the United Kingdom in the late 1970s and early 1980s in order to stabilize inflation). In fact stabilization policy cannot easily be distinguished from macroeconomic policy in general.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Bibliography
Currie, D. 1985. Macroeconomic policy design and control theory – A failed partnership? Economic Journal 95: 285–306.
Dornbusch, R. 1976. Expectations and exchange rate dynamics. Journal of Political Economy 84(6): 1161–1176.
Friedman, M. 1953. The effects of a full employment policy on economic stability: A formal analysis. In Essays in positive economics, ed. M. Friedman. Chicago: Chicago University Press.
Friedman, M. 1968. The role of monetary policy. American Economic Review 58: 1–17.
Kalecki, M. 1944. The white paper on employment policy. Bulletin of the Oxford Institute of Economics and Statistics 67: 131–135.
Lucas, R.E. 1976. Econometric policy evaluation: A critique. Journal of Monetary Economics, Supplement, Carnegie-Rochester Conference Series on Public Policy 1: 19–46.
Maddock, R., and M. Carter. 1982. A child’s guide to rational expectations. Journal of Economic Literature 20: 39–51.
Meade, J.E. 1951. The balance of payments. London: Oxford University Press.
Meade, J.E. 1982. Stagflation, vol. I: Wage fixing. London: George Allen & Unwin.
Minister of Reconstruction. 1944. Employment policy, cmd. 6527, presented by the Minister of Reconstruction to Parliament. London: HMSO.
Moggridge, D.E. 1986. Keynes and the international monetary system, 1909–46. In International monetary problems and supply-side economics, ed. J.S. Cohen and G.C. Harcourt. London: Macmillan.
Phillips, A.W. 1954. Stabilization policy in a closed economy. Economic Journal 64: 290–323.
Phillips, A.W. 1957. Stabilization policy and the time-forms of lagged responses. Economic Journal 67: 265–277.
Poole, W. 1970. Optimal choice of monetary policy instruments in a simple stochastic macro model. Quarterly Journal of Economics 84: 197–216.
Preston, A.J., and A.R. Pagan. 1982. The theory of economic policy, statics and dynamics. Cambridge: Cambridge University Press.
Swan, T.W. 1960. Economic control in a dependent economy. Economic Record 36: 51–66.
Tinbergen, J. 1952. On the theory of economic policy. Amsterdam: North-Holland.
Tobin, J. 1975. Keynesian models of recession and depression. American Economic Review: Papers and Proceedings 65: 195–202.
Tobin, J. 1980. Stabilization policy ten years after. Brookings Papers on Economic Activity (1) (10th Anniversary Issue): 19–71.
Vines, D. 1986. Macroeconomic policy after monetarism. Royal Bank of Scotland Review.
Vines, D., J.M. Maciejowski, and J.E. Meade. 1983. Stagflation vol. II: Demand management. London: George Allen & Unwin.
Author information
Authors and Affiliations
Editor information
Copyright information
© 2018 Macmillan Publishers Ltd.
About this entry
Cite this entry
Vines, D. (2018). Stabilization Policy. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95189-5_1757
Download citation
DOI: https://doi.org/10.1057/978-1-349-95189-5_1757
Published:
Publisher Name: Palgrave Macmillan, London
Print ISBN: 978-1-349-95188-8
Online ISBN: 978-1-349-95189-5
eBook Packages: Economics and FinanceReference Module Humanities and Social SciencesReference Module Business, Economics and Social Sciences