France's Recent Economic Activity

Global Business Context Assignment 2008 Part 1: Frances economic performance over the last 40 years can be illustrated using three master(prenominal) macroeconomic variables; unemployment, inflation and gross domestic product. When comparing them against each other, we can condone the relationships between each variable. (A table of the variables can be gear up in the appendix.) This graph shows that although there appears to be no choose relationship between GDP and unemployment until after around 1986, a correlation begins after this point. As we would expect to see, GDP increases as the rate of unemployment falls and vice-versa. Unemployment has been increasing since 1970 and continued until around 1986, in conclusion peaking with very high rates of nearly 12% in 1994. When analysing the French GDP, it is evident that although it fluctuates, it does not follow a foreseeable pattern between 1970 and 1986; all three variables seem to be unstable until around this time. It is worth noting that the economy seems to perform cleanse from the time Jacques Chirac became president in 1995, which may have been due to new economic policies.

Also, the substantial dip in GDP and sharp increase in inflation from the early 1970s was probably attributable to the OPEC oil crisis of 1973 (and 1978) which would have affected both businesses and homes, resulting in less money to spend and less possible for output. (Zaleski, 1992) This graph reveals French inflation taking on a surprising path, moving in the opposite direction to changes in GDP which we would not normally expect to happen. This, alongside an psychoanalysis of the inflation and unemployment graph indicates that France experienced cost-push inflation from 1970 until around 1985. As the costs of production rose due to the inflation generally caused by the OPEC oil crisis (an example of import push inflation), unemployment change magnitude as companies could not afford to pay workers and thus trim their output. The effect of this can be... If you want to get a mount essay, order it on our website: Orderessay

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