^{page 8 note (1)} Analysis of the November package is rather diflicult because of the lack of precise knowledge of company beha viour. See National Institute Economic Review no. 70, November 1974, pages 7-9.

^{page 8 note (2)} See page 13 below for a more detailed examination of the budget deficit.

^{page 9 note (1)} It was also unlikely that the Arabs would give away all their increased revenues to (developing) countries which could absorb large increases in imports from the industrial countries.

^{page 10 note (1)} Apart from any residual statistical error, the financial balances of the public, private and overseas sectors (the current account of the balance of payments plus capital transfers, with the sign reversed) must sum to zero by definition.

^{page 10 note (2)} See National Institute Economic Review no. 68, May 1974, pages 29-31.

^{page 11 note (1)} Ninth Report from the Expenditure Committee. Session 1974, H.C.238, Question 465, page 136.

^{page 12 note (1)} Though the reintroduction of hire-purchase controls would tend to increase savings as measured in the national accounts: consumers were net repayers of debt in the first half of the year-page 21.

^{page 13 note (1)} Of the two (pre-budget) forecasts given in February, the ‘optimistic’ showed a rise of 0.8 per cent in GDP over this period, and the ‘pessimistic’ a fall of 1.5 per cent.

^{page 13 note (2)} See National Institute Economic Review, no. 59, February 1972, pages 35-37 and no. 63, February 1973, pages 12-14; also M. J. Artis, ‘Fiscal policy for stabilisation’, in W. Beckerman (ed.), The Labour Government's Economic Record: 1964-1970, Duckworth, 1972.

^{page 15 note (1)} The move into recession would of course automatically open the budget deficit as tax receipts fell, and unemployment benefits increased. If the government moved to offset this widening, further deflation would result until, in the absurd limit, the level of output and demand was reduced to the point at which consumption of oil was low enough to eliminate the ‘oil deficit’.

^{page 16 note (1)} The GDP relative probably overstates the effect somewhat because the escalation of oil and other import prices will have affected the price of public expenditure, but not the GDP deflator. On the other hand the total expenditure relative probably understates it because the TFE deflator will have been raised by a greater amount by import costs than will the price of public expenditure.

^{page 17 note (1)} This period of comparison eliminates the distorting influence of the 1974 miners' strike.

^{page 18 note (1)} If this is so, then attempts to ‘cyclically correct’ (i.e. raise) the 1971 productivity figures in order to calculate the con ventional GDP ‘gap’ (potential minus actual GDP) will have led to an overestimate of the slack in the economy at the start of the 1972-73 upturn (see National Institute Economic Review, no. 63, February 1973, pages 25-33). This could well account for the fact that unemployment fell more rapidly in 1972-73 than we had been expecting.

^{page 19 note (1)} This adjustment makes a part-time male worker approxi mately equivalent to 0.46 of a full-time male worker, and a part-time female worker 0.54 of her full-time counterpart.

^{page 19 note (2)} Cf. ‘Part-time women workers 1950-1972’, Department of Employment Gazette, November 1973.

^{page 30 note (1)} On a landed, c.i.f., basis, it can be argued that the contri bution of the oil price rise was rather less than this because of the collapse in freight rates which it triggered off.

^{page 32 note (1)} Basically profits and other public surpluses together with income from rent and self employment.

^{page 32 note (2)} Roughly the weights are ¼ for each of import prices and net indirect taxes and ½ for labour costs.

^{page 32 note (3)} The calculation may slightly understate the beneficial effect of net indirect taxes in 1974: in particular, the food subsidies would be almost entirely attributable to consumer prices-that is they should have been given a rather higher weight than the average.

^{page 34 note (1)} Only arithmetically; the rise in stock appreciation does not account for the poor performance of non-stock profits.

^{page 35 note (1)} The introduction of advance corporation tax does, of course, affect company liquidity and cash flow.

^{page 36 note (1)} Unless the government undertakes more investment directly.

^{page 36 note (2)} Disposable employment incomes were obtained using the Blue Book allocation of income tax to wages and salaries and employees' national insurance contributions. The tax allocation is somewhat arbitrary when an individual receives more than one type of income.

^{page 37 note (1)} The lowest decile is the income level below which the lowest 10 per cent of incomes fall (25 per cent for the lowest quartile); the median income is that income above and below which half of the number of earners are found. It differs from the average which is the total income divided by the number of recipients.