R. C. O. Matthews, C. H. Feinstein and J. C. Odling‐Smee

in British Economic Growth 1856-1973

Published in print October 1982 | ISBN: 9780198284536
Published online November 2003 | e-ISBN: 9780191596629 | DOI:

Series: Studies of Economic Growth in Industrialized Countries


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Intermittent phases of high demand may affect the way demand keeps up with supply. The pressure of demand was obviously higher in 1951–73 than before 1914 and a fortiori higher than in the interwar period. Differences in cycle‐amplitude partly accounted for the differences between periods in the average pressure of demand. A Keynesian decomposition of the sources of demand pressure indicates that foreign trade was the main reason whythere was more excess supply in the interwar period than earlier. But investment, not the direct injection of demand by government, was what caused the high level of demand after World War II.

Keywords: components of demand; cycle amplitude; demand management; excess demand; excess supply; real wages

Chapter.  14525 words.  Illustrated.

Subjects: Economic History

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