Is there room for demand-stimulus policies?

Should governments now give priority to demand-stimulus policies (higher public spending, higher wages)? This depends, of course, on the degree of capacity under-utilisation (output gap): if capacity utilisation is high, stimulating demand would increase inflationary pressures and worsen foreign trade. To assess capacity utilisation, we need to look at trends in the capital stock, the labour force and working time; but we also need to take into account the fact that the rise in the relative price of energy and commodities reduces the profitable supply of goods and services. Taking all of these developments into account, we see, by examining the situations of the United States, the United Kingdom, Germany, France, Spain, Italy and Japan, that the effective capacity utilisation rate is very high, and therefore makes a demand-stimulus policy ineffective, in all these countries except Spain, Germany and Japan.