The calculations underlying this forecast were completed by 14 November, and are based on the assumption that the policies then in force would not be changed. Consequently, they make no allowance for any new measures which may be introduced, at home or overseas, following the monetary crisis of the subsequent week.

The growth of production in the industrial countries now seems likely to be significantly bigger both this year and next than we thought in August. The rise in their combined national outputs may be 5 rather than 4½ per cent in 1968 and some 3½-4 per cent in 1969. Unemployment seems to have turned downwards since about the middle of the year in most countries.

This note is a sequel to an earlier article by W. A. B. Hopkin and W. A. H. Godley which set out a method of estimating how the main aggregates in the national accounts will be affected over a period of 18 months or two years by changes in taxation. More recent experience and additional research into methods of short-term economic forecasting have led to further developments in the same field.

The work that can be so far summarised is concerned with five main questions. First, what are the extent and nature of the waste of human resources implicit in the existence of differences between regions in the labour market, widely interpreted? Secondly, what are the extent and nature of inter-regional differences of real income? Thirdly, what is the nature of the differences between growth-rates of industrial employment in different regions? Fourthly, what is the general pattern of inter-regional movement of population and of job opportunities and (very tentatively) is there any sign that regional population growth is part of a self-reinforcing process? And, finally, what can be said about the effects of government policy on the distribution of industry and employment in recent years?

This article describes an attempt to establish by regression analysis the form of the relationships which determine wage-rates and average earnings in the United Kingdom.