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Period: to
Inflation
Theres a change from high to a low inflation during the 1980's. -
Period: to
Unemployment
Unemployment was low in the 1960's and early 1970's --> leading to a long period with a high and persistent unemployment -
Period: to
The golden years
High growth, high employment, and improvements in living standards.
The welfare state was expanded. -
Growth Rate
The growth rate was 6.5% -
Period: to
Denmark suffering from 'twin deficit'
A 'twin deficit' means that there was a deficit on both the current account and the public balance. - Since the 1990's the currnt account has been in surplus, which implies that Denmark has accumulated a net wealth position of about 40% of GDP. -
Period: to
Reduced unemployment
Unemployment was reduced.
The financial crisis raised unemployment, however, the level remains significantly below the level in the period from the mid 1970's to the mid 1990's. -
Period: to
The oil crisis
Increase in oil prices. The global downturn caused low growth and high unemployment. Fuelled inflation. The economy was stuck in stagnation. Fiscal policy was expansionary --> however, it did not help. They went from being an energy imports to being a net exporter of energy. -
Period: to
Nominal interest rate
Adjustments in financial markets illustrated by developments in interest rates. Nominal interest rates have adjusted to the low inflation regime -
Period: to
The big upturn and the seven meagre years
The center-right government launched a disinflationary policy.
Tight income policy to reduce price and wage inflation. They wanted to reduce the current account deficit --> was succesfull.
Had low growth rate and high unemployment.
The current account got improved due to slack domestic demand and due to low wage increases and improvement in competitiveness. -
Period: to
The recovery period
Launched paid leave schemes to reduce registered unemployment and share available jobs more evenly.
Rules for mortgages with property as collateral were liberalisered and taxes were lowered. The economic situation changed markedly.
Growth and employment started to increase.
The current and public finances were improved. -
Period: to
The IT crisis and overheating
The stock market crash and the burst of the so-called IT bubble and the terror attack on the World Trade Center in NY.
Growth declined internationally, causing lower growth and increasing unemployment. - this was temporary.
Growth got better and unemployment started to decrease. Inflation remained low. The economy was overheating: wages rose and competitiveness deteriorated. -
Growth Rate
The growth rate was about -5.1%