Burnley and Asda are unlikely warnings of debt-driven troubles
It has been a week of mixed messages. Not just on the release from lockdown, but on the economy. The Bank of England indicated that banks have been given six months to prepare for negative interest rates. The Monetary Policy Committee was quick to clarify that this did not mean that they would necessarily cut […]
Our tech advances are difficult for productivity stats to compute
One of the most depressing aspects of the decade of the 2010s, well before Covid-19 struck, was the apparently very slow growth in productivity. This is not a mere ivory tower issue. It is only through increasing productivity that rises in living standards can be sustained. Productivity is the key measure of the efficiency of […]
Lockdown 2.0: A creative destruction revolution, or the death knell of innovation?
So Boris Johnson has failed to follow his own government’s guidelines on cost-benefit appraisal. Study after study by economists show that the costs of lockdown far exceed the benefits. The NHS — the “envy of the world” — has conspicuously failed to develop sufficient capacity to deal with a second wave, despite having had months […]
The national productivity recovery depends on getting people back to the office
Office workers continue to display reluctance to return to their workplaces, despite encouragement from the government for them to head back. The immediate consequences for the service jobs in cities which depend on people commuting into the office are apparent, hence the government drive. But is office work a good thing for the workers themselves? […]
Great expectations: The Darwinian wars of economic and epidemiological forecasting
A key concept in modern economics is, to use the jargon term, rational expectations. The idea has dominated orthodox macroeconomics over the past 30 years. Not all economists have been persuaded of its merits by any means, but nevertheless, its influence has extended far beyond academia, into finance ministries and central banks around the world. […]
Office clusters are as crucial to productivity as they ever were
The Prime Minister is now demanding that offices reopen to revive economic activity in the centres of towns and cities. But there is not much sign of a return to work. The preferences of the workforce are an important factor in the very slow pace of return. Fears expressed about the safety of public transport […]
Innovation is the only way to recover from the Covid crisis
One silver lining of the Covid-19 crisis has been a surge in innovation. Enterprising firms have invented both new products and different ways of delivering existing ones. Innovation is the life blood of any prosperous economy. Innovation is much more than a scientific invention. It turns inventions into things of practical and affordable use to […]
A tip for Dominic Cummings: Don’t hire anyone who fails to grasp the power of incentives
The job advert issued by Dominic Cummings for people to work in government has attracted a wide range of comments. One particular focus has been on the sorts of skills he is looking for. Computer science, forecasting, artificial intelligence, causality theory — all these topics excite his interest. Cummings advocates a small selection of scientific […]
Creepy micromanagement won’t drive productivity — try trusting staff instead
Calling all employers: what was in your Christmas stocking? Did you find the latest gadget designed to enhance productivity? The innovative device, featured in the media during the festive season, is a toilet with a downward sloping seat. The company which makes it, StandardToilet, has conducted extensive tests. A slope of 13 degrees is exactly […]
Supply and demand at work, or just good bargaining? The reality behind CEO pay
A report published by Deloitte a couple of weeks ago will have enhanced the feeling of holiday wellbeing for many people. The median annual pay for bosses of FTSE 100 companies fell in 2018 to £3.4m, compared to £4m in 2017. This is the lowest level since 2014, when the UK brought in rules which […]
