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Input Price Shocks and the Slowdown in Economic Growth: The Case of U.K. Manufacturing

Michael Bruno; Jeffrey D. Sachs

Title:
Input Price Shocks and the Slowdown in Economic Growth: The Case of U.K. Manufacturing
Author(s):
Bruno, Michael
Sachs, Jeffrey D.
Date:
Type:
Reports
Department(s):
Earth Institute
Persistent URL:
Series:
NBER Working Paper
Part Number:
851
Geographic Area:
Great Britain
Notes:
Presented at the Conference on Unemployment, Newnham College, Cambridge, July 1981. Published in Review of Economic Studies, vol. 49, no. 5 (1982), pp. 679-705.
Publisher:
National Bureau of Economic Research
Publisher Location:
Cambridge, Mass.
Abstract:
This paper provides a theoretical and empirical analysis of the effects of input price shocks on economic growth, with a focus on United Kingdom manufacturing in the 1970s. The theoretical model predicts a discrete decline in out- put and productivity after an input price rise, and a longer-run slowdown in productivity growth, real wage growth, and capital accumulation. These features characterize the United Kingdom and most other OECD economies after 1973. The empirical results confirm the important role of input prices in recent U.K. adjustment, but also point to an important role for other supply and demand factors.
Subject(s):
Managerial economics
Economics
Item views
222
Metadata:
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Suggested Citation:
Michael Bruno, Jeffrey D. Sachs, , Input Price Shocks and the Slowdown in Economic Growth: The Case of U.K. Manufacturing, Columbia University Academic Commons, .

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