ECO342H1 Lecture Notes - Lecture 1: Marshall Plan, Free Trade, General Agreement On Tariffs And Trade
Document Summary
Will focus on contract between rapid growth, low interest rates, fixed exchange rates, and full employment of 1945 to 1970 to slower growth, inflation, high interest rates, flexible exchange rates, and unemployment between 1970-1995. Real gdp per capita averaged 3. 8% in golden age (1950-1973) but only 1. 7% from 1973-1992. Will also look at japan and latin america. Government policy focused on full employment from 1950-1973. Government policy focused on monetary policy to eliminate inflation from 1970-1995. Also believed in deregulating markets to allow price adjustments to bring full employment. Establishes fixed exchange rates that collapsed in 1971. Economic integration in europe despite post-war antagonism between ex-combatants. Convergence of per capita incomes due to trade liberalization and migration. Convergence of country growth rates to steady-state path determined by technology and savings. Backwards countries grow rapidly from 1945 to 1970 through transfers of us technology to catch up to us growth rates.
