It’s time the Bank of England rethinks monetary policy – and its own methods
The Bank of England’s handling of inflation has been met with increasing levels of criticism. Despite its suite of academically fashionable mathematical and econometric models, the Bank seems to be acting in a daze, unable to comprehend what is going on. A paper just published in the American Economic Review advocates an alternative way of […]
Confusion is the keyword for UK bonds as financial markets’ confidence fades
The yields on British government bonds have drifted upwards again. As many commentators have pointed out, we are back at the levels experienced during the short-lived premiership of Liz Truss. An obvious culprit is government debt, now at around 100 per cent of GDP in the UK. This in itself can create anxiety in the […]
Windfall taxes, like speeding fines, can’t be a plaster solution for losing tax revenue
The flashing yellow boxes in the roads of Hammersmith and Fulham have become notorious. On Talgarth Road, a single one alone yields over £3m in fines to the local council. For motorists, the situation nationwide is about to become even worse. Nearly 30 local authorities have put forward proposals to enforce 111 boxes, under legislation […]
Artificial intelligence won’t destroy your job, just look at Octopus Energy’s use of AI
There is growing concern about the potential power of AI to develop itself and to dominate humanity. Elon Musk was the best known of the thousands of signatories of an open letter last month calling for a pause in artificial intelligence research, but at the same time that he was issuing the warnings, Musk announced […]
Starmer is right, we need to give up on the cult of a university education for all
Labour leader Keir Starmer came under fire for his recent reverse ferret on abolishing university tuition fees. Some see it as an inability to stick to a pledge, while others view it as a further betrayal of the policies of Jeremy Corbyn. From an egalitarian perspective, Starmer’s decision is absolutely correct. Abolishing fees would cost over […]
The Bank of England needs trade unionists and social scientists to stop groupthink
The Bank of England’s persistent failure to meet its inflation target over a long period of time is a matter of public record; the huge increase in inflation over the past 18 months or so is simply the most spectacular of the Bank’s errors. Every single member of the Monetary Policy Committee (MPC), both those […]
Monopolies hire too many pointless managers and kill off productivity growth
The need to increase productivity is of fundamental importance to the political economy of the Western democracies. As I’ve written, the causes for this slowdown in productivity eludes a consensus. The big tech companies are often seen as hives of innovation. But they might be responsible for at least part of the productivity problem. In […]
Our ailing productivity is workers’ payback to the greed of bankers after the 2008 crash
The self-destruct mission led by the SNP has helped the Labour party to be seen as firm favourites to win the next election, quite a turn around from their 2019 fate. But were he in government, he would be grappling with exactly the same issue Rishi Sunak is now. Namely, how to raise the rate […]
From international trade to interest rates, macroeconomics is in yet another tail spin
Fifty years ago, the Euro area accounted for 30 per cent of the world’s economy. Since then, there has been a steady fall; now, its share of world output has halved. In contrast, the Asia-Pacific economies have grown much faster. These trends are well established, and this region will increasingly dominate the world economy. Yet, […]
Yes, money can buy happiness and our well-being doesn’t plateau as we get richer
Does money buy happiness? The question is a perennial one. From ancient times we have the cautionary tale of King Midas, who, according to Aristotle, starved to death as a result of his “vain prayer” to turn everything he touched into gold. The quality of life is influenced by many factors other than money, as we […]
Our struggle with illegal immigration will be nothing compared to in 10 years time
Across the political spectrum, the number of small boats crossing the Channel has occupied a huge slice of our collective consciousness. At one level, of course, these are stories replete with human suffering and tragedy. On another level, for those in the UK, it is a question of control over our borders. In trying to grapple […]
A post-mortem of pandemic-era lockdowns expose a dangerous disregard for scepticism
Like most people, the revelations from the leaked WhatsApps of government ministers during the pandemic have left me with a mixture of emotions. At one level, they reveal how difficult it is to make decisions amidst considerable uncertainty. It is always easy, after the event, to point to mistakes and say they could have been […]
Our regulators are too close to those they should be regulating – and this is a problem
Late last week, news slipped out that the Treasury had asked Parliament to authorise up to £200bn to cover losses from the Bank of England’s quantitative easing (QE) scheme. To help the economy get over the financial crisis of the late 2000s, the government agreed to cover any losses the Bank made on bonds bought […]
Sports clubs defy the normal rules of markets and won’t bend to a football watchdog
As a native of the town of Rochdale, I follow the fortunes of Rochdale Association Football Club. I am indeed, albeit in a modest way, a shareholder. This investment is unlikely to finance my old age. The team currently sits bottom of the entire Football League, 92nd out of 92 clubs and at risk of […]
The race for AI-powered search engines is a long war and ChatGPT could easily lose
The AI chatbot ChatGPT has taken the world by storm – and for once, the hyperbole is justified. Tens of millions, perhaps hundreds, of people across the world who never previously engaged with artificial intelligence are referring to the tool as if it were an old friend which they had known forever. Naturally, such an […]
