Monetary Policy & the Economy Q4/04 – Economic Growth in Denmark, Sweden and the United Kingdom since the Start of Monetary Union

minants of potential growth, cyclical fluctuations in GDP and the contribution of the national economic policy of each of the three countries. High spending on research and development, particularly in information and communications technology, is identified as the main force driving growth in Sweden while a robust increase in private consumption resulting from rising asset prices is found to have been the key growth driver in the United Kingdom. In Denmark and Sweden, swings in the business cycle are being successfully offset through fiscal policy and other measures. The United Kingdom has made considerable progress with respect to business cycle convergence with the euro area, a significant factor for joining Economic and Monetary Union.