Prime, Policy Research in Macroeconomics

The following is a statement in response to recent media comment on the public finances, signed by 22 economists as at 26th November, 2017It can be downloaded here as a pdf. Andrew Neil of the BBC Politics programme recently challenged the Shadow Chancellor, John McDonnell, on the likely cost in interest payments of additional public borrowing. He suggested that current debt interest payments are estimated at £49 billion, and rising. His use of £49 billion was misleading, as...

Within hours of becoming Prime Minister last year, Theresa May made an important economic statement. She put ‘Industrial Strategy’ in the title of the Department for Business. No longer, she was declaring, would a Conservative administration regard active government intervention in the economy as anathema. The economy was too weak for such a luxury. Henceforth the state would play a leading role in getting markets and private enterprise to work better. In most developed...

We live in an age of irresponsibility. Reckless politicians, lacking suf­ficient evidence, led us into prolonged and costly wars in Iraq and Afghanistan. Regulators, economists and policy-makers passed up responsibility (in the 1960s and 70s) for the management of financial markets. Instead, something akin to Dante’s Sorcerer – the “invisible hand”...

Make no mistake, yesterday’s increase in interest rates was a big deal. Painful as it might be for a good share of the population, the real point is that the Bank is signalling the end of a particular phase of monetary policy. Since 2010 the counterpart to self-defeating austerity policies has been expansionary monetary policies. These have inflated assets - enriching the already-rich, while failing to stimulate wider economic recovery. Yesterday the Bank of England’s Monetary...

Image with acknowledgement to Google Search Anyone familiar with the austerity obsession of EU leaders will know that the boundary between fiscal virtue and profligate sin lies at minus 3%.  A budget balance below the ominous minus 3 sends the offending government to the fiscal headmasters of the European...

As you would hope, there was a lot of new economic thinking at the recent (21-23 October) Institute for New Economic Thinking (INET) conference in Edinburgh. Economists from across the world presented stimulating papers on issues ranging from secular stagnation to imperfect knowledge, the dual economy to macroeconomics and gender. There were...

This article was first published on the Prospect magazine website on 15th October 2017“Strong and stable” seems of a world so far, far away.  The recent Daily Mail headline “PM slaps treacherous Chancellor down” portrays a government in political chaos. Thanks to open, unresolved intra-Brexiteer warfare, ministers are unable to agree the basics of how to exit the European Union. This state of uncertainty intensifies just as the risks to British jobs and living standards are...

"A European cultural consciousness exists and there exists a series of manifestations by intellectuals and politicians who maintain the need for a European union: it can also be said that the historical process leads towards this union and that there are many material forces that will be able to develop only in this union. If...

On 9 August, 2017, PRIME held an event at the TUC to mark the date ten years ago when inter-bank lending froze, and the global financial system began to unravel. We invited Andrew Simms of the New Weather Institute, Frances Coppola and Prof. Daniela Gabor to take stock and assess the state of both the financial and eco systems ten years after the first signs of economic failure. The event was chaired by PRIME’s director, Ann Pettifor.Prof. Gabor began by quoting a Reuters...

We know that the UK economy has remained in a rut, plagued by foolish austerity and declining real wages, since the great financial crisis.  We know too that the Eurozone suffered its own, largely self-imposed, economic stasis or decline – notably from 2010 to 2015, with unemployment over 10% till late last year.So I thought it could be interesting to look, in a simple way, at the performance of a set of mainly developed economies, in Europe plus a few from other parts of the...