The Economic Consequences of Disarmament in the Netherlands

General and complete disarmament in the Netherlands would result, as might be expected, in a decreasing national product and an increasing unemployment. How ever, these unfavourable consequences can be met successfully by rather simple coun ter-measures, consisting of the maintenance or even the increase of total effective de mand, provided these measures are prepared and taken in time. To make the like lihood of a smooth conversion as great as possible this preparation should be done by the Government as well as by the individual firms. This last condition is not fulfilled in reality. Detailed governmental counter-measures, meaning intervention in individual firms or industries, do not seem necessary on a large scale. Supply of labour being a bottleneck for growth in the Netherlands, the resources freed by disarmament may give new possibilities for economic growth.The effects of disarmament for Surinam and the Antillian Islands run via the markets for primary products, especially bauxite and oil. Since demand on these markets is probably determined not only by such factors as price, quality and distance, but also by national-political influences, the ultimate result cannot be predicted but can be described as non-positive for the development of these areas.