Supply-side Indicators for the UK Economy

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Supply-side Indicators for the UK Economy

• February 2009

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Key supply side concepts

• Aggregate supply
• Incentives for people and businesses
• Productivity
• The economys productive potential
• Capital Investment
• Research and development
• Product and Process Innovation
• Skills / Human Capital
• Competitive markets / market deregulation
• Long run economic growth
• Non-inflationary growth

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What are Supply-Side Policies?

• Supply-side policies are designed to
• Improve incentives for people to get new jobs
• Increase the productivity of labour and capital
  inputs
• Increase the occupational and geographical
  mobility of labour to reduce unemployment
• Increase the level of capital investment and
  research and development spending by firms
• Stimulate inflows of overseas capital investment
• Increase business efficiency by promoting more
  competition within and between markets
• Stimulate a faster pace of invention and
  innovation throughout the economy
• Provide a platform for sustained non-inflationary
  growth of an economy

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Importance of supply-side policies
Long term importance of supply-side policies for
the British economy
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Relative productivity
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Estimates of Trend Growth
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Spending on research and development
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Output per hour worked
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Potential GDP and Trend Growth
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Investment and Productivity in the UK Economy
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Actual and Potential GDP
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Investment and GDP Growth
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Profitability of Manufacturing and Service Sector
Industries
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Estimated NAIRU for the UK
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UK Output Gap
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Labour Market Participation
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Unemployment Rates
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Unfilled Vacancies
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Public and Private Sector Jobs
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Inflation-Unemployment Trade Off
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Relative Living Standards
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