Evaluating National economic performance

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The meaning of national economic performance

Perfomance can be judged against the economy's past and current record in:

  • Reducing and then maintaining a low level of unemployment
  • Achieving and then sustaining a satisfactory rate of economic growth, uniterrupted by excessive inequality in the distrubution of income and wealth
  • Controlling inflation and avoiding destabilising swings in the inflation rate
  • Improving the competitiveness in international markets of the country's industries
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The role of performance indicators in the setting

  • Can be used for comparing the performance of the UK with that of other countries

Lead indicators

  • provide information about the future state of the economy
  • surveys of consumer and businesws confidence and investment intentions indicate the existence of feel-good or feel-bad factors and provide information about the likely state of AD a few months ahead
  • Statistic for house-building and holiday bookings provide information about future spendings, While data on commodity and input prices can signal future changes in retail price inflation

Lag indicators

  • Provide information about the extent to which past economic peformance had led to an outcome that meets the different criteria listed for macro performance
  • Data on the level of GDP and current and recent employment - provide information about current and recent economic performance
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