The role of governments in economic affairs

Abstract

European Governments are increasingly re-examining their roles in relation to economic management and industrial policies, with dramatic developments being observed in the UK, Belgium and Holland. In this paper, M. Giscard d'Estaing writes from the perspective of the former President of the French Republic in analysing what Governments should not do and what they should do. They should not, he argues, employ price and wage controls, become directly involved with the channelling of savings and investments, or employ exchange and trade controls. They should implement stable monetary policies and predictable fiscal policies. They still have to work out what to do about long term demographic trends, technology, space and defence, and above all, Europe's inability to generate more employment. This paper was originally read to the Top Management Forum in Vienna on May 14th 1985. The Top Management Forum is organized by Management Centre Europe and The Economist.