Secular stability
The defining characteristic of US economic data since the financial crisis is not stagnation, but stability. We all look back on the Great Moderation with incredulity at the hubris of economists. But has realit...
The case for a new economics
What’s really wrong with NAIRU
Earlier this year, Matthew Klein at FT’s Alphaville, made a typically punchy and well-argued case for abandoning a cornerstone of the current macro policy framework - the NAIRU...
Has the Bank of Japan solved the ‘Piketty problem’?
Japan’s unlikely re-distribution
Why is the Bank of Japan (BoJ) trying to raise the rate of inflation? Taking account of its demographic profile, Japan's economic performance has been impressive by developed w...
Renzi’s referendum, Europe’s future
It seems apposite that Matteo Renzi's term as Italian Prime minister should end in this way. This referendum was a surreal distraction. Italy does not need faster political decision-making. Good decisions alway...
The Bank of Japan is testing Romer’s hypothesis
Has the last thirty years of macroeconomics been a waste of time?
World Bank chief economist, Paul Romer, has again written a very important critique of modern macroeconomics – or more specifically the academi...
Brexit: everyone got it wrong
'Brexit' means brexit. Why do I have a feeling some Leavers will end up saying 'we never left', and some Remainers will say the same. The opposite is also likely. Some Leavers and Remainers will agree: Brexit d...
Institutions matter
The monetary & fiscal distinction revisited
Monetary policy involves changes in the supply of base money and is carried out by central banks. Fiscal policy involves taxation, spending and transfers carried o...
The Best of Brexit
The Best of Brexit
Perhaps the best thing to have come out of Brexit has been the writing. So here is a collection of my personal favourites. There are serious omissions - so feel free to suggest additions i...
Old myths, new problems – interpreting a British referendum
The myth of national identity
One consequence of the end of the Cold War was the re-emergence of nationalism in European politics. It was not the “End of History”, but reversion to the mean.
Nationalism is...
Buffett v the Landesbank – the US gets paid to have a trade deficit
It remains conventional wisdom that the US current account deficit is the accumulation of a debt that will one day need to be repaid. There are very good reasons to believe this is false. The US in fact has ne...