ABSTRACT
The 1980s started with industrial output falling and unemployment rising at rates not seen since the 1930s. The hoped-for upturn always seemed some months hence, and even the more optimistic forecasters seemed to see only a feeble recovery at the end of the downturn. Economics was once more 'the dismal science'. Its reputation was not helped by the deep division amongst economists about causes and cures. Recessions can be attributable to any one of the variety of causes which lead to a growth of effective demand greater than that of potential supplies. Primary production, finance capitalism and traditional industry did not disappear but had to retreat relative to other activities. Product prices are subject to a number of influences, of which the Paish cycle is only one; that is a cycle of the domestic economy which can be overshadowed by international price movements, as in the 1970s.
