History Of Output Fluctuations

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EC831 Research Project What were the main characteristics of British macroeconomic fluctuations from 1790 to 1914? Analyse how the determinants of cyclical fluctuations changed over this period. Abstract The theory of the trade or business cycle has been an important topic for economic researchers and this concept became more prevalent throughout this period for many reasons; most notably being the impact of the industrial revolution. Not only did the characteristics of cyclical fluctuations change over this period, but the variables that affected the fluctuations changed significantly. Some of the contributing factors became more prominent whereas other factors had almost completely lost their significance by the end of the period. It is also evident that some factors were present during different parts of the cycle, and were therefore responsible for initiating contractions or expansions in the economy. Some researchers have used time series evidence to test the causes of British business cycles and various implications have been drawn from these findings. However, not all authors are in agreement of the importance of the numerous cyclical determinants and there is room for debate depending on the validity of the assumptions incorporated into different models. Hypothesis and Motivation This topic is of renowned importance because, although there is usually an upward trend and growth of the economy, there have always been deviations away from these trends and it generates great interest to find out why these cyclical fluctuations have occurred. The purpose of this project is to see how output, productivity and other macroeconomic criteria fluctuated over the period from 1790 to 1914. From this, one can observe trends and cycles in economic activity and distinguish between different cycles. More importantly, the aim of this project is to view what

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