Wednesday, October 21, 2015

Economic System of the United Kingdom

The United Kingdom uses a mixed economy. Their system is based on free trade. The UK's economy lets the market make the majority of the UK's economic decisions. The market does not make economic decisions for military spending and public education. The spending done by the government for social needs (military spending and public education) is 35% of the GDP. While the rest of the economic decisions are made by the market.(more here)
Services, particularly banking, insurance, and business services, are key drivers of British GDP growth. Manufacturing accounts for about 10% of economic output. Capital controls were removed from the UK in 1979. In the 1980s, ownership of public corporations became private sectors. During times of crisis however, the Bank of England coordinates interest rate movements with the European Central Bank.
The government will intervene in the market when needed. In 2008, BROWN (Labour) government was prompted to implement a number of measures to stimulate the economy and stabilize the financial markets. Gordon Brown was Prime Minister in 2008. In 2010, the CAMERON led coalition government initiated an austerity program to lower the national deficit.(more here)
 The economy has  traditional influences in it as well. There are drinking laws put on youth where it is illegal for youth under 18 to buy spirits in a pub. That puts a strain on businesses who cannot sell their product to a certain demographic. (more here)
Overall, from the 2015 Index of Economic Freedom, from the rankings of most to least free economies, the United Kingdom is at #13. The United Kingdom's economy rests at about 30% centrally planned and about 60% free market.(more here)

Group UK: Garret, Sara, Bayliee

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