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Small Business and the Macro Economy: Some Observations
Pages 182-189

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From page 182...
... The United States has perhaps the largest small business sector of the Western advanced economies. There, in the 1990s, small business accounted for approximately half of total private-sector employment and output.
From page 183...
... In the United States in the prosperous decade of the 1990s, small businesses accounted for 75 percent of net new jobs a share that is larger than their share of total employment. In a recession, we can expect small business to account for a disproportionate share of job losses.
From page 184...
... A BRIEF REVIEW The Russian economy has seen extraordinary changes in the past three years. After the government's default on its domestic debt in August 1998 and the subsequent paralysis of its payments system, output plunged to the lowest levels ever in a disastrous decade.
From page 185...
... A1though the industrial output measure is more volatile, the two data series show the same general pattern: They were negative in 1998 (even before the August financial collapse) ; they rebounded strongly in 1999; and finally, they tapered off in 2000 and 2001, while still so far remaining positive.
From page 186...
... Russia exports such large quantities of crude oil and various oil products that every dollar's increase in the price of a barrel of petroleum translates into roughly $1.5-$2.0 billion of additional yearly export revenues. The world oil price rose from barely $10 a barrel in February 1999 to more than $27 a barrel a year later, continuing eventu
From page 187...
... In fact, the relationship between oil prices and industrial output is so close that it is tempting to ascribe virtually all of Russia's post-August 1998 economic performance to oil. That is, all the other factors that are assumed to influence economic performance exchange rate dynamics, monopolies' pricing policy, taxes, investment rates, competition policy, capital flight, banking reform, monetary policy, and progress on corporate governance and "rule of law" would be irrelevant.
From page 188...
... (And remember that oil and gas invests about 10 times as much as either heavy manufacturing or the food industry.) Thus, not even by the crudest of measures, gross capital spending, has the opportunity afforded by the devaluation and oil price rises been used to appreciably upgrade production capacity in most of the economy.
From page 189...
... What is most important is that governments at all levels draw up plans on the basis of realistic assessments of the economic future and that they commit themselves to implement those plans over the longer term.


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