The UK economy
- Created by: lizziegill17
- Created on: 28-02-15 14:53
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- UK economy
- 1979
- Thatcher came to power - monetarism (changes in the money supply to affect economy)
- Winter of discontent
- £ had appreciated due to North sea oil production and hot money inflows from high interest rates
- High inflation - mortgage repayments were increasing, and AD was falling
- The 1980s the Lawson Boom
- Nigel Lawson - chancellor of the Exchequer
- Trade deficit / high inflation / housing boom and economic expansion
- Thought it was sustainable due to recovery of industrial output
- Credit driven boom
- Increase in privatisation
- 90s and 2000s NICE period
- Overheated economy 'bust' in early 90s
- Exited the ERM in 92'
- House prices fell 1990-1950 due to increased interest rates
- BoE was made independent of government with monetary Policy committee created to set interest rates in 1997
- Expectation of stable inflation rates- led to non inflationary,constant expansion period
- Growing gap between services and manufacturing
- Immigration- cheap labour and high supply
- Overheated economy 'bust' in early 90s
- 2008 onwards
- Bad bank lending decisions - low savings and high spending - high personal debt
- High national debt - decline of manufacturing industry
- 1979
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