ABSTRACT
In November 1990, Margaret Thatcher resigned as Prime Minister, bringing to an end one of the most remarkable political careers of modern times. During her eleven years in office, her government transformed the face of British macroeconomic policy, shattering the ‘postwar consensus’ that had grown up since 1945. Prior to 1979, successive governments had sought to maintain aggregate demand at a level sufficient to achieve ‘full employment’. In other words, demandmanagement policy had been directed towards ‘real’ macroeconomic objectives for output and employment. In contrast, ‘supply-side’ policies (i.e. policies designed to influence private sector decisions to produce goods and services) had primarily taken the form of rules and regulations, notably controls that limited the size of wage and price increases which companies were permitted to make.
