Wars and Interest Rates in the United Kingdom (Essay Sample)

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Wars and Interest Rates in the United Kingdom, 1730-1920? Mankiw 8th edition, Ch-3, Page 73
In this case study, the writer states that wars have direct and significant impacts to the economy of any nation. Further, they affect the individual lives of those involved. As for the UK, the case study reveals that between the years 1730 and 1920, the jurisdiction was faced a myriad of wars, which ultimately impacted on its economy due to the following reasons; First of all, the war shifted the government’s attention towards development as it needed to spend a lot of funds in the purchase of guns and hiring of more military personnel. Second of all, the UK government was required to borrow funds from other countries. These undertakings placed the economy at an instable and rather deplorable situation. As the military spending increased in the years 1930 to 1919, the interest rates, as far as government bonds are concerned, generally referred to as consols, also heightened.
The case study reveals that it is not desirable to make use of wars in proving or disproving the practicality of economic theories or ideologies. This is buttressed and enhanced by the reason that it is possible for multiple economic changes to take place at the same instance...