Meanwhile, higher public spending on capital investment and other special procurements will boost domestic demand.

The weaker peseta would stimulate demand for Spanish exports and reduce Spain s imports, which would boost domestic demand and reduce unemployment.

It intends to boost domestic demand and is committed to moving gradually toward greater exchange rate flexibility.

Recent fairly generous wage agreements in Germany will help, but are not enough there is also a need to boost domestic demand.

For example, while US monetary policy intervention (yes, monetary policy is also intervention) has done little to boost domestic demand, it has spurred domestic capital to search for yield around the world.

The neo Keynesian economist wants to boost demand generally.

The turmoil has led to a gradual rebalancing, with the US current account deficit beginning to narrow and emerging markets taking steps to boost domestic demand.

And countries, like China, that rely excessively on net exports for growth should accelerate reforms, including more rapid currency appreciation, in order to boost domestic demand and consumption.

Low interest rates strengthen the ability to pay, and thus boost demand.

Can anything halt this swing of the pendulum? Absent a sudden, immediate, and strong boost in US domestic demand that turns into a durable boom with rapid employment growth, probably not.

So Germany s refusal to boost domestic demand and reduce its external surplus, along with its insistence on conservative inflation targets for the ECB, severely undercuts prospects for European prosperity and unity.

Policymakers initially resorted to government spending and low interest rates to boost demand.

China has elevated the reduction of external imbalances to a major national objective in 2007. It intends to boost domestic demand and is committed to moving gradually toward greater exchange rate flexibility.

In principle, Germany could try to boost domestic demand by leveraging up but, unless the exchange rate adjusts upward to shrink the tradable sector at the margin, doing so would be inflationary.

To offset the collapse in demand from industrial countries, they had stimulated domestic demand.

Oil exporters could, in turn, promise to increase domestic consumption expenditure, which would boost imports.

Rebalancing demand, from investment and exports to domestic consumption

Rebalancing demand, from investment and exports to domestic consumption

Devaluation renders exports more competitive, thus substituting external demand for the domestic demand that is being compressed.

But, even as China recovers from its current slowdown, it is not likely to provide a similar boost to all of its trading partners. That lack of spillover will reflect the recovery s focus on expansion of domestic demand.

It is understandable that the Fed wants to boost demand as long as the US economy remains depressed.

The US has been pushing China, Germany, Japan, and others to raise consumption in order to boost demand.

With domestic demand still weak, more export demand is just what the doctor ordered for an anemic economy.

In the US, the weak dollar will be a powerful boost to net exports, and thus to aggregate demand.

For this large sector, there is no substitute for domestic demand.

A world where over spending countries need to reduce domestic demand and boost net exports, while over saving countries are unwilling to reduce their reliance on export led growth, is a world where currency tensions must inevitably come to a boil.

At the same time, Japan s demographic trends will boost demand for fiscal expenditure, as pension and health care costs rise.

Southern Europe has not done enough to enhance its competitiveness, while northern Europe has not done enough to boost demand.

Other contributory factors were high domestic liquidity and low, albeit gently rising, interest rates, which enhanced domestic demand expansion.

It also means getting the balance between domestic and external demand right, and appreciating the sensitivity of medium and long term growth to the composition (and size) of domestic aggregate demand.

Second, the Chinese production mix does not correspond to domestic demand, and investment in long products has outpaced demand growth.

Long term growth depends not on foreign demand, but on domestic supply.

The reason, of course, is the strong increase in Chinese domestic demand.

However, the rapid expansion in domestic demand resulted in remarkable trade deficits.

Using exchange rates to boost net exports is a zero sum game at a time when private and public deleveraging is suppressing domestic demand in countries that are running current account deficits and structural issues are having the same effect in surplus countries.

In the run up to the Seoul summit, the US government put forward a proposal that the surplus regions of the world should increase their domestic demand mainly consumption to boost imports and thereby help the deficit regions (including the US) to recover.

The impact on growth will almost certainly be negative, even if domestic demand compensates fully for the decline in external demand.

And Germany is slowly acquiescing to a prudent relative expansion in domestic demand.

Otherwise, outsourcing merely reduces demand for domestic labor, just like other efficiency gains.

Indeed, it seems unlikely that governments in China and similar emerging markets can compensate swiftly enough to boost domestic consumption.

It must pledge to boost domestic expenditures, reduce its external surplus, and accept an increase in the ECB s inflation target.

The first path is to boost demand for goods and services, and then sit back and watch employment rise as businesses hire people to make the goods and services to meet that demand.

Energy hungry America has long depended on the global market to meet domestic demand.

They doubt that an alternative development strategy based on boosting domestic demand would succeed.

That lack of spillover will reflect the recovery s focus on expansion of domestic demand.