Timmy elsewhereDecember 21, 2014 Tim WorstallTimmy Elsewhere8 CommentsSo why was economic growth higher in 1945-1973 than it is now? At The Register. previousAll sounds logical enoughnextTimmy elsewhere 8 thoughts on “Timmy elsewhere” dearieme December 21, 2014 at 2:36 pm About the best that Economics can achieve is to tell you when some idea is rubbish. john77 December 21, 2014 at 4:36 pm There are lots of reasons, one of which is a careful selection of start and end dates. Start with one when the odd million were producing nothing towards GDP because they were in the Army, Navy or Air Force overseas and endi8ng just before the miners’ strike and just after the jump in oil price but before it had timne to hit our growth rate. It’s like my starting my economic growth rate the day after I finished my post-graduate Diploma and ending the day after I started work – that would look good, too! The economists’ standard quick answer is “cheap oil”. A more sophisticated analysis would break down 1945-73 into periods of Labour and Conservative government and find that the periods of Conservative government showed significantly higher growth rates thanks, at least in part, to a reduction in government interference. Economic growth while Mrs Thatcher was PM was slower than under the 1951-64 Conservative government but faster than any Labour government since 1951 at least (I regularly fail to find any data on growth under the “wonderful” Attlee government. A significant part of the decline in growth rate is because 1945-73 contained 16 years of Conservatives to 12 of Labour and 1974-2014 contained just under 18 years of Conservative and just over 18 years of Labour. Big government helps? So Much for Subtlety December 21, 2014 at 10:20 pm More young men and less immigration. New technology, new businesses, are usually the work of young men. Immigration cuts the need to invest in new technology. Why pay for a robot when you can hire someone fresh off the boat from Sierra Leone? We have an aging population, as TW points out, and have been flooded by the Third World. Why would there be all that much growth? Luke December 22, 2014 at 12:03 am SMFS “New technology, new businesses, are usually the work of young men. ” Immigrants are mainly young men. So Much for Subtlety December 22, 2014 at 12:31 am Luke – “Immigrants are mainly young men.” And every neighbourhood has a corner shop that shows that some immigrants do open businesses. But they also usually bring dysfunctional cultures with them. So Sergey Brin? Fine. Up to a point. Our special visa scheme to make sure we have enough illiterate peasants working as waiters in Indian restaurants? Not such a good idea. Cal December 22, 2014 at 12:33 am Well, I absolutely staggered by this article. I thought Tim Worstall of all people would realize that the reason that growth rates have slowed since the early 70’s is to do with the explosion in regulation that started hapening around then. Look, Milton Friedman was on to this years ago. He pointed out somewhere (probably in Free to Chose, or maybe Capitalism and Freedom) that in the West in the 50s, 60s and the first half of the 70s you had a lot of socialist rhetoric, but a much more free market then people realized (apart from some notable exceptions), whereas after that things swapped around — there was a lot of free market rhetoric from that point, but in reality, while there was some obvious market restrictions loosened, you had a huge amount of government regulation that really got going then, not to mention the welfare state/public service/public spending started ballooning at that point and has done ever since. Andrew Duffin December 22, 2014 at 12:03 pm What Cal said. Growth happens (big-style) when our inventiveness outruns the ability or ambition of the bureaucrats to invent ways of stopping it. Given the regulators’ current level of expertise, their sheer numbers, the technology at their disposal, and the fact that many people actually support their obstructiveness, high rates of growth may never happen again. So Much for Subtlety December 22, 2014 at 12:06 pm Andrew Duffin – “Growth happens (big-style) when our inventiveness outruns the ability or ambition of the bureaucrats to invent ways of stopping it.” What Cal and Andrew said. We have just seen an example of this with fracking. We are about to see another example with Uber. Think how much better Britain would be with both. Leave a Reply Cancel replyYour email address will not be published. Required fields are marked *Comment Name * Email * Website Save my name, email, and website in this browser for the next time I comment.