Commonwealth countries must work together to remove barriers to economic growth

Summary:  On April 16th, Commonwealth Heads of State will meet in London at the start of the UK’s chairmanship of the CHOGM process (which ends in 2020). While it is coincidental that this timing directly overlaps with the UK’s exit from the European Union, many in the UK have turned their focus back onto the ... Continue reading

Melrose takeover of GKN is a matter for business, not politicians

Summary:  The ongoing controversy over Melrose’s purchase of engineering company GKN illustrates many common misunderstandings about how free markets can work to the benefit of all. Shareholders, not politicians, should decide how to run their businesses, including whether a new management team could do better. There is only a limited set of circumstances where it ... Continue reading

Crude gender pay gap reporting measures render results meaningless

Summary: Despite an influx of new gender pay gap data - ranging from negative gaps, to gaps exceeding 60% - the government’s new pay gap reporting measures fail to provide any meaningful insight into equal or fair pay for men and women in the workplace. The requirement to measure pay gaps across entire organisations (rather ... Continue reading

SMPC votes to raise Bank Rate in March

An email poll of the Shadow Monetary Policy Committee (SMPC) in March produced a vote to raise interest rates by nine to nil. All nine members voted for ¼% increase to a Bank rate of 0.75%. The bias of eight members was for further tightening and one for a neutral stance. All members saw the ... Continue reading

Banning fast food outlets is not the answer to tackling obesity

Summary:  Several local authorities in Britain have introduced ‘zoning laws’ to restrict fast food outlets within a certain distance of schools. Public Health England, the British Medical Association and the Mayor of London have all endorsed this policy as a way of tackling childhood obesity. Standard economic theory suggests that restricting supply by law leads ... Continue reading

IEA Brexit Unit responds to the Whitehall Economic Impact Analysis

Summary:  The Whitehall Briefing (leaked in January but only officially released this month) is not the last word on the potential long-term economic impact of Brexit, despite claims from others that it 'proves' GDP will be lower in 'all' scenarios. As the report itself says, it is only 'draft analytical thinking with preliminary results', with ... Continue reading

Politicians should stop jumping on the anti-finance bandwagon

Summary:  Animosity towards the business of finance is ancient and persistent. Because finance creates intangible value, its contribution to society is still invisible to many observers – including former regulator Lord Turner, who described large swathes of the sector as ‘socially useless’. Such claims are unfounded and dangerous. Not only that, but the oftproposed remedy ... Continue reading

A system of private banks ensures stability without a central bank

Summary:  In the late eighteenth and early nineteenth century, Scotland had a stable financial system. Its stability arose from the pressure that private banks, which had the right to issue bank notes, placed on each other to behave prudently. Unlike in England, the Scottish banking system had no central bank. If one bank within the ... Continue reading

IEA Brexit Unit releases report on US UK trade deal

Summary:  The US is likely to be at ‘the front of the queue’ for a new trade deal with the UK after Brexit. This would require the UK to escape the constraints of the EU’s Customs Union and also be free to diverge from EU regulations. But if these two conditions are not met, many ... Continue reading

Remaining in a customs union could be backdoor to keeping many obligations of the Single Market

Summary:  Like most decisions about Brexit, the choice of future customs arrangements is about getting the trade-offs right. Remaining in a customs union with the EU would not just prevent disruptive border checks. It would also allow tariff-free trade to continue after the UK left the Single Market, and could make it easier to replicate ... Continue reading