Second Stage Thatcherism 1983-87

Question 1

How did monetarism end?

Answer 1

-experiment with monetarism ended by thatchers second term
-final nail was Lawson abandoning spending targets 1986

Question 2

What was supply side economics?

Answer 2

-thatcher didn’t return to demand side of PWC
-concentrated in market reforms such as privatisation + deregulation

Question 3

What was the cycle of supply side economics?

Answer 3

—> deregulation for businesses (+ low tax) encourages enterprise + entrepreneurship
—> flexible lab makes easier hire/fire workers
—> employees spend on goods + services (encouraged by low tax)
—> business make profits
—> profits encourage expansion/further investment into business