Macro - Examples Flashcards
Interest rates
Low - UK 0.1%. Japan at -0.1% in 2016 to boost consumption after ‘death spiral’ of deflation due to housing crash.
India has helped keep AD up to support heavy growth
High - Argentina 25%
Consumer Confidence
Increased consumption
High - US, Eurozone
Low - UK due to Brexit
House Prices generating wealth effect
High - UK, US
Indebtedness
Low = Germany (save to spend culture)
High - UK, US
Real Disposable Income
High - Australia
Low - Brazil, Russia, Venezuela
Income tax
High - Sweden, Norway
Low - US, Trump cut tax for middle class
Business Confidence
High - US
Low - UK
Corporation Tax
High - UAE (55% only on Oil and Gas companies, none on anything else)
Low - Ireland (12.5%), US (Trump cut from 35% to 20%)
Gov. Spending
High - France
Low - UK during austerity after 2008. Greece.
Ireland but once they came out growth boomed due to huge fiscal surplus generated. GDP per Capita now high.
Exchange Rates
Weak - Pound due to Brexit, Russia, Brazil went into recession due to weak ER
Strong - Australian dollar
High commodity prices
Shifting SRAS Left
Oil shock in UK 2009
High Wages
Shifting SRAS Left
UK (Living wage), USA
sales tax
UAE introducing VAT (5%) Shifted SRAS left
Japan increases in 2014 caused a recession
Falling commodity prices
Issues for countries who are big exporters of them
Venezuela, Russia, Zambia (copper)
Stagflation
High inflation with stagnant growth
Venezuela, Argentina
