This Report was written as part of a comparative study of international competitiveness and welfare statism in five countries. In addition to the United Kingdom, the broader study includes France, Germany, Sweden and the United States. The case study of the United Kingdom discussed in this Report takes as its focus and point of departure the experiences of the United Kingdom during the 1980s under the policies of Mrs Thatcher, policies associated with what is referred to in Australia as 'economic rationalism' and 'the new right'. While there are differences between the economic and social policies introduced by the Thatcher Government and those pursued in Australia in the last decade, there are similarities too, reflecting similarities in the economic problems confronting the two nations, as well as the broad policy framework adopted. There can be few in Australia, whatever their political persuasion, who would doubt that the two main themes of this Report. International Competitiveness and the Welfare State, lie at the heart of this country's economic and social difficulties. For this reason alone, we in Australia have much to gain from a better understanding of the United Kingdom experience. And when that experience is analysed by such an insightful and provocative writer as Ian Gough, the benefits are all that much greater. The report is organised in four main chapters, considering in turn: British policy debates on international competitiveness; Trends in the competitiveness of the UK economy; Developments in economic policy; and, Changes in 'welfare statism' - British social policies and their outcomes. It covers the period since the beginning of the international crisis in 1973, but its main focus is on the 'Thatcher Experiment’ since 1979.