Economic Theory
Do you ever wonder why banking, more than any other industry, is so prone to instability? Why, nearly ten years since the global financial crisis, economic performance has been anaemic at best? Why the cornucopia of analysis by intelligent sounding talking heads resembles mumbo jumbo? In Mervyn King’s book The End of Alchemy (2016), he ... Continue reading
Britain's productivity growth has halted. The evidence is clear. Since the financial crisis, output per hour worked has been effectively stagnant, only re-hitting the peaks seen at the end of 2007 in late 2016. This is unprecedented. To see the scale of the deviation from trend, if it had continued to grow as it did ... Continue reading
Economic Theory
The Equality Trust is the latest organisation to call for the mandatory reporting of the ratio between the pay of the highest and lowest earners in UK companies. At first sight this is a small step that would simply increase transparency in pay practices – who could reasonably object? But in reality this proposal would ... Continue reading
Economic Theory
Matthew Taylor was doing the rounds at the weekend, talking about the Review of Modern Employment Practices which he is conducting on behalf of the government – more evidence that Mrs May wants to rebrand the Conservatives as a sort of Blue Labour. Taylor’s Review Group has been touring Britain talking with people about the ... Continue reading
Economic Theory
  Many commentators try to fill us with a sense of economic foreboding, basing their reasoning on the amount of debt we are accumulating. They are wrong to do so and are only looking at part of the picture. 2016 was a year when consensus pundits deserved three times to have egg on their faces. ... Continue reading
Economic Theory

Diego Zuluaga appears on BBC Radio 4's Thinking Allowed programme

Diego Zuluaga, Financial Services Research Fellow at the Institute of Economic Affairs has appeared on BBC Radio 4's Thinking Allowed programme to discuss the idea that the nature of economics is responsible for the failure to predict the financial crisis. In the interview Diego argues that we need to distinguish between economic analysis and the ... Continue reading
The announcement by Phillip Hammond that there will be no Budget spending sprees is to be welcomed. When interest rates are low and economic activity is below the full employment level, it has become a familiar canard that the government should borrow in order to spend its way to growth. Where the lay public and ... Continue reading
Famously, Michael Gove attacked experts in the EU referendum campaign. And, of course, the experts have fought back, leading Gove to add appropriate context to his remarks. Nobody wants brain surgery from a non-expert. At the same time, there is a paradox. On the one hand, we should use reason to try to improve the ... Continue reading
As the chancellor prepares his Budget and US President Donald Trump shapes his economic plan, commentators are urging both to engage in significant new spending on transport infrastructure. The conventional case was articulated well by Times columnist Oliver Kamm last week. Only the government can undertake the investment and planning necessary for complex projects such ... Continue reading