panish economy in the mid 1980s fell within the realm of capitalism in spite of the fact that the country had a socialist government in its second term of office. While not all of the factors of production in Spain were in private hands, the Spanish government had in progress a massive privatization program that was intended to return all of the country's industry to private sector control.
Industrial production in Spain grew 14 percent from 1980 to 1985. Gross national product growth averaged 2.1 percent annually during this same period. Spain's production possibilities were continuing to increase as a result of the government's efforts to attract foreign capital to the country. As a consequence, the country's economic efficiency was trending upward. Spain was performing relatively well in the context of income distribution. The structure of income distribution is Spain compared well with that in the United States. In the mid 1980s, Spain was continuing to experience a problem with inflation, but the conditions were improving dramatically 8.9 percent in 1985. The country's critical unemployment problem was also beginning to improve, but remained high 20.9 percent in 1985. Unemployment was expected to remain stubborn for some time into the future. In the mid 1980s, Spain was the largest relatively undeveloped consumer market in Europe. Spain had a population of 36 million who until the 1980s had not had the means to support a consumer oriented economy. Compared to most of the other Western European countries Spain had remarkably low labor costs coupled with an intelligent and well trained work force.
In most of the other countries of Western Europe during the mid 1980s, inflation was under control and economic output was increasing. In the mid 1980s also, the member countries of the European Economic Community were looking forward to an almost complete removal of economic barriers within the community. Spain,...