1st Edition

Economic Growth in the West Comparative Experience in Europe and North America

By Angus Maddison Copyright 2006
    248 Pages
    by Routledge

    248 Pages
    by Routledge

    Hailed a "an outstanding contribution to our knowledge of the way in which western economies work" [Times Literary Supplement], this penetrating study of economic growth compares and analyzes tic rates of economic advance in the twelve leading countries that comprise the industrial West. Mr. Maddison examines why, after relative stagnation for several decades, the rate of economic development accelerated in continental Europe in the 1950’s, whether this represented a new economic pattern which could be maintained or was only a passing phase of recovery after World War II. He observes that the economies of North America and the United Kingdom seemed by comparison almost to stand still, and he explores the influence of economic policy on the differing growth rates, and the growth potentials and desirable lines of policy in the industrial West. He then discusses the major powers’ policy problems, whose outcome so closely affects the developing nations.

    Mr. Maddison presents basic statistical series, going back to 1870 in most cases, on gross national products, productivity, population, labor force, employment, working hours, investment and capital-output ratios. He draws upon this rich fund of comparative statistics with skill and insight, relating it throughout to the broad questions of economic policy which are at issue. This classic book was first published in 1964.

    INTRODUCTION 15

    I THE RECORD OF WESTERN GROWTH 25

    The Growth of Output

    Movement in Population and Output per Head

    Labor Supply

    Total Labor Input

    Productivity Growth

    Comparative Levels of Productivity

    II THE REASONS FOR ACCELERATED GROWTH 43

    The Impact of Demand

    Demand, Profits and Profit Factors on the Supply Side

    Recovery Elements

    Disguised Unemployment

    The American-European Productivity Gap

    Structural Changes in Expenditure and Output

    The Effect of European Integration

    The Role of Investment.

    III INVESTMENT AND GROWTH 76

    The Pattern of Investment

    The Measurement of Investment

    General Influences Affecting the Productivity of Investment

    Capacity Use

    Replacement

    Capital Widening and Deepening

    The Nature of Technical Progress

    The Quality of Management and the Capacity to Absorb Investment

    Conclusions

    IV THE ROLE OF GOVERNMENT IN PROMOTING GROWTH 99

    The Aims of Policy

    Managing the Level of Demand

    Public Spending

    The Management of Private Demand

    Conclusions on the Management of Demand

    Maintaining Competitiveness

    Conclusions on the Control of Prices

    Fostering the Growth of Output Potential

    Education and Research

    Incentives to Corporate Investment

    Tax Inducements to Personal Savings

    Government Influence on the Pattern of Private Investment

    Government Saving and Investment

    Other Measures Affecting the Allocation of Resources

    Planning

    The Process of Policy Formulation

    Conclusions

    V THE INTERNATIONAL ENVIRONMENT 158

    The Structure of the World Economy

    The Nature of the Interdependence of Industrial Countries

    Trade, Trade Policy and Economic Growth

    Capital Movements as a Stabilizing and Destabilizing Force

    International Liquidity and Payments Arrangements

    Payments Problems

    Policy Weapons for External Equilibrium

    Conclusions

    APPENDICES 194

    INDEX 243

    Biography

    Maddison, Angus