ECON 2P19 Lecture Notes - Fiscal Policy, Stagflation, Money Supply
7 Mar 2014
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Conversion to a peacetime economy, 1945-1950: real gdp declined in 1946 but rose consistent there after, beginning in 1948, european nations could use american credit under the. Increases in aggregate demand were strong and widely based. Stabilization policy, 1957-1961: stagflation a simultaneous rise in both inflation and unemployment. In the early 1960s, the canadian auto industry was a high cost miniature replica of its u. s. counterpart: prices for automobiles were about 10% higher in canada than in the u. s. and. Canadian wages were around 30% lower: the agreement brought about duty free trade in new vehicles and parts between. Canada and the u. s. but at canadian insistence, only for vehicle manufacturers. Automobiles and parts became the leading item in canada"s trade accounts and made up most of the increase in finished manufactured products. Stabilization policy, 1961-1973: first liberal budget in june 1963, by finance minister walter gordon, was aimed at reducing the deficit, and was mildly contractionary.
