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13. Перескажите текст "Economic Policy".

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For countries like the UK, which are heavily dependent on foreign trade (about 30 percent of UK output is exported direct­ly or indirectly), the foreign balance is a critical matter. While short-term deficits might be covered by the use of official

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reserves and overseas borrowing, in the longer ran a country must pay its way in the world. But a satisfactory balance of pay­ments position is not simply one in which income equals expen­diture on foreign account. Equilibrium should not be achieved at the expense of the other objectives of economic policy.

Policies under fixed exchange rates

When countries are operating fixed exchange rates, national economies are closely linked and economic changes in one country will transmit their effects fairly quickly to other countries. Thus, a country experiencing a higher rate of inflation than its competitors will find its balance of pay­ments position deteriorating because imports are becoming more competitive on the home market and exports less com­petitive in world markets. With a fixed exchange rate the immediate effect of any deficit falls on the official reserves of gold and foreign currency. When there is a persistent deficit, these reserves (plus borrowing facilities) will soon be exhausted so that, if the exchange rate is to be held, the gov­ernment must take steps to eliminate the deficit.

Expenditure — reducing measures are those which aim to reduce aggregate demand, and we are now familiar with the manner in which fiscal and monetary policies are used for this purpose. A fall in total planned spending must lead to a fall in the expenditures on foreign goods and services. It might also lead to an increase in exports as domestic firms find it more difficult to sell in the home market and make greater efforts to sell in overseas market.

There might, however, be an unfavourable 'feed-back' effect from abroad, because a cut-back in the country's imports reduces other countries' exports and, hence, other countries' income. The country carrying out the expenditure — reducing policy, therefore, might find that, although it has favourable effects on its imports, it also has unfavourable effects on its exports. The other major problem with these

measures is that they tend to increase unemployment. If the deficit is a substantial one, expenditure — reducing measures would be very unpopular because it would require a relatively large reduction in aggregate demand in order to achieve the required cut in import expenditures. In other words, the 'cost' in terms of unemployment would be politically unacceptable. Expenditure-switching measures attempt to direct spending from foreign goods to home-produced goods. In order to deal with a deficit, steps might be taken to make imports relatively dearer in the home market and exports rel­atively cheaper in foreign markets. Devaluation would be the appropriate instrument for this purpose. Alternatively, such measures might take the form of direct controls on imports. Tariffs, quotas, and exchange control can all be used to limit imports and divert demand to home-produced goods. An incomes policy might also be regarded as an expenditure-switching policy. If it succeeds in holding down a country's rate of inflation below the rates being experienced in other countries, the prices of its products will be falling (i.e. rising more slowly) relative to those of its competitors' goods. Expenditure-switching measures will not be very effective where there is a high propensity to import and the demand for imports is very inelastic. In such circumstances the use of tariffs or devaluation could lead to cost-push inflation.