How Much Spare Capacity is There in the UK Economy?
10 Pages Posted: 8 Jul 2005
In this paper, Stephen Nickell, member of the Bank's Monetary Policy Committee, analyzes the extent of spare capacity in the UK economy. The results indicate that the amount of spare capacity available in 2004 is greater than in 1999-2000, not very different from that in 2001-2003 and slightly less than in 1995-1998. On balance, there still appears to be some spare capacity available in the labor market, but within firms the overall situation is tight.
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