Economic Histories of the West Essay
Economic Histories of the West
The economic history of the Great Britain since WWI is fundamental. Generally, Great Britain has embraced an advanced and changing economic imagery since the lapse of the WWI. This has been characterized by foundations of great economic growth and development with a characteristic phenomena of a broad imaginary in the status of both macro and micro economic various. Great Britain has evolved through various historical events, which has seen it enjoy changing structural autonomies in its economic portfolio.
Perhaps however, it would be realistic and logical to comprehend about economic surges and downward threshold characteristics that have shaped its economy WWI. Generally, end of the WWI did not only lead to destabilized and affected economic statuses in other global communities but also gave a great challenge to Great Britain. Characteristically, these phenomena led to unstable state of various economic markets, which consequently led to unstable state of aggregate demand and supply in such markets.
Historically, great depression that hit the world at the beginning of 1929 and ran across the 1930’s was greatly fundamental in shaping the Great Britain’s economy. Like any other country’s economy, it went into an event of great economy recession that was characterized by an equilibrium imbalance between aggregate supply and demand. Characteristically, this period was marked by events of high domestic consumption of locally produced commodities in its local capacity that led to high local consumption of what the households produced.
Consequently, the aggregate demand that could fetch monetary value was lower than the aggregate supply. (John, 1997) Essentially, a characteristics phenomenon of the great depression towards the Great Britain was a general instability in economic variables. Various markets that included foreign, commodity, monetary, capital and labour lacked the general conservative economic requirements of market clearing which was reasoned by disequilibria between aggregate demand and supply Historically, the lapse in great depression which was characterized by economic recession waved in a historical moment in the global economy, which was WWII.
From the influence of instability in the society, the WWII waged a discontent in the global development autonomy including that of Great Britain. There was no adequate economic microclimate, which would have waged a fantastic economic growth. However, the end of the WWII was now a road map towards great economic endeavors in the country. As noted down in many chronological biographies, economic epochs started in WWI, which was brought out by the competition portfolio of economic kingship between Germany and Great Britain.
The WWII era to the country was highly consequential towards its economic development. It imposed various exchange controls, which coupled selling out of its gold and dollar reserves that it had within its economic framework. This was for use in paying raw materials, munitions and also equipments for its industries from various factories in America. It led to a reduced level of capital export. However, the litigate state of economic relationship between it and the America was highly influential in modeling the status of its economic developments.
This was because of the competition that it got from the America. (Denis, 1995) After the end of WWII, Great Britain echoed great losses on its absolute wealth. This was from the manner of its economic drive towards serving the requirements of WWII. It consequently took a long time in reorganizing a peaceful production system. However, a call for liberalization on post war trade across the international imagery was perhaps crucial in modeling a changing economy for this country. This brought international capital flow from various trading partners including the U.
S, which was a dominant economic icon in the global economy. Such new charter on international capital flow consequently led to green moments for Britain in its economic modeling. This was arrived at in the 1941 Atlantic charter which led to establishment of Breton Woods System. However, the halting on lend-lease by the USA in 1945 gave highly expensive terms of acquiring foreign capital through loans from USA. It was characterized by high interest rates. Basically, the same was fundamental in leading towards low states of production for Great Britain.
The labour market was also highly invisible which was a domain challenge in the production system in its economy. Generally, Great Britain had experienced a threshold of great economic capabilities across the board from the WWI and II. Great changes had occurred to its markets when new bilateral arrangements on trade were made between commonwealth nations. (James, 1997) However, it embraced new economic development philosophy between 1970 and 1979. This was through an advocacy of its Prime Minister Harold who presided over stopping the rate of inflation for a more rational economic growth.
At this time, its economic growth rate was only one half that of France and Germany. However, the entrance of the Great Britain in European Economic Commission provided perhaps a historical move towards its economic growth. Consequently, it established a European Free Trade Area (EFTA) to any country that was not a member of ECC. However, there was no much economic influence by its entrance to the ECC especially due to the impact of its striking labor unions in campaign for better employment regulations that could not be provided by the economic situation existing at the moment.
However, the rule of Labor Government ended in 1978. (John, 1997) Perhaps however, entrance of Margaret Thatcher as its Prime Minister in 1979 was liberation towards the development of its economy. Basically, her rule was motivated in reducing trade unions’ power whose discontent had highly paralyzed the economic functionality. She entered in by applying various economic growth tools which used various monetary policies that were aimed at reducing the then existing level of inflation in the country.
Elsewhere, she had a great influence over reducing the existing level of public spending that had provided very low levels of saving for further chances of investment. However, during her early ages of governance (1979-1980), Britain had been faced with an economic recession that had imbalanced the level of aggregate demand and supply. Consequently, this country was faced with further levels of unemployment. Various economic developments tools echoed her rule, which included industrialization and privatization of state firms.
(Robert, 1994) The main philosophy with her labour party was economic development that was coupled with resilient social portfolio. However, the former entrance of Britain into EEC in 1973 was ratified by Thatcher’s governance that provided a greater scope of foreign economic interaction with other members of the EEC. Considerably, the late 1980’s saw Britain increasing its competition efficiency that synchronized great frontiers towards economic development. Amongst her contributions was the charter of exchange controls and international trade relations with other countries.
Until her step down in 1990, Margaret Thatcher had provided an adequate exchange system that provided an attractive system for export and import activities within Britain. This condition provided great frontiers towards Britain’s success in economic development. (Denis, 1995) The entrance of John major as Britain Prime Minister in 1990 further strengthened the status of economic developments. Here, he formulated structures for support in British pound to be operational within the EU exchange rates.
Consequently, new economic structures that strengthened both its monetary and fiscal policies were put down. Elsewhere, its markets were stabilizing after full clearance that saw Britain enjoy the sovereignty of high economic development.
Dennis, H (1995) Britain in the World Economy. Allen & Unwin James, D (1997) Ancient Britain. London, Routledge John, K (1997) Federal Britain: A History. London, Routledge Robert, M (1994) British Industry Since the Second World War. History Today, Vol. 44
University/College: University of Arkansas System
Type of paper: Thesis/Dissertation Chapter
Date: 12 January 2017
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