Prospects for the Uk Economy

Küçük, Hande; Lenoel, Cyrille; Macqueen, Rory

doi:10.1017/nie.2020.43

Cited by 3 publications

(2 citation statements)

References 16 publications

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“…Lockdowns reduce the overall labour supply, but while there is excess labour supply in some areas such as the recreation, travel and restaurant sectors, there is a shortage in others, for example in healthcare, agriculture and childcare. The state, as in wartime, could help divert labour to areas where required and provide basic training for necessary skills development (Küçük et al, 2020). 3.…”

Section: Fiscal Policy Objectivesmentioning

confidence: 99%

“…Another mitigating factor for the UK during the Covid-19 crisis has been that the rise in public deficit has been matched by a rise in private sector savings, which implies increased tax capacity that could be utilised if solvency were to become an issue (Küçük et al, 2020;. This is different to what would have happened if the rise in the deficit had been financed by borrowing abroad, which would have increased the sensitivity of government debt to external financing conditions (Küçük, 2020).…”

Section: Taxmentioning

confidence: 99%

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Commentary: Proposals for a New Fiscal Framework

Chadha

Küçük

Пабст

2021

NIER

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How did you go bankrupt?" "Two ways. Gradually, then suddenly."Ernest Hemingway, The Sun Also Rises (1926) [P]ublic opinion requires, justly perhaps, that a deliberate plan, and particularly a new plan, should not merely be better than doing nothing, but much better. A new plan is required to meet objections, which apply equally to the old plan. But which in the case of the latter custom has caused us to forget. The new plan is required to satisfy ideals of social justice much higher than we have been attaining without it. J. M. Keynes, How to Pay for the War (1940) Towards better fiscal policiesModern representative democracy is faced with the Whiggish directive to improve living standards with the main lever in possession of any government being its fiscal policy. That is its choice on how much to spend, tax and borrow and on what. The electorate is supposed to assess the alternate options offered by the political marketplace, and the set of offered policies that most closely match those of the electorate, or more precisely its median voter, will be the basis for the government's fiscal strategy (Persson and Tabellini, 1994). And yet once in office governments are not in control of events and must respond again and again to developments that cannot have been imagined only a few years earlier (e.g. Brittan, 1969). Our recent history alone has produced three extraordinary events in a dozen or so years that have in turn asked for flexibility, and then constrained the operation of fiscal policy: the Global Financial Crisis (GFC), the Brexit vote and the Covid-19 pandemic. As much as a politician wants to be seen as the saviour of the nation, they also do not wish to be seen as the person who suddenly bankrupted the state.There has repeatedly been a fine line between enabling those democratically elected to make a policy choice and the need to demonstrate a sound approach to the management of the fiscal purse strings

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Section: Fiscal Policy Objectivesmentioning

confidence: 99%

Section: Taxmentioning

confidence: 99%

Commentary: Proposals for a New Fiscal Framework

Chadha

Küçük

Пабст

2021

NIER

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Rethinking Evidence-Based Policy

Пабст

2021

NIER

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Much of public policy-making has in recent decades been driven by the idea of evidence-based policy – policy rooted in the principles of social science and, more specifically, empirical validation based on social and behavioural science. This article argues that evidence-based policy, while helping to improve the design of policies aimed at changing individual behaviour, lacks a recognition that individual and group choices are embedded in social relationships and institutions. There is a risk of over-relying not only on probabilistic models that under-state our condition of ‘radical uncertainty’ but also on data and metrics that are disconnected from the everyday experience of workers and citizens whose needs and interests cannot always be measured or managed. Since uncertainty is a fundamental reality of both the economy and social life, policy-making needs robust conceptual narratives to make sense of numbers and provide a sound basis on which to make decisions allied to ethical judgements.

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UK economic outlook: Brexit Britain in Covid recovery ward

Küçük¹,

Lenoel²,

Macqueen³

2021

NIER

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for helpful comments and Patricia Sanchez Juanino for preparing the charts and the database underlying the forecast. The forecast was completed on 25 January 2021, more recent data are incorporated in the text. Unless otherwise specified, the source of all data reported in tables and figures is the NiGEM database and NIESR forecast baseline. All questions and comments related to the forecast and its underlying assumptions should be addressed to Cyrille Lenoël

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Prospects for the Uk Economy

Cited by 3 publications

References 16 publications

Commentary: Proposals for a New Fiscal Framework

Commentary: Proposals for a New Fiscal Framework

Rethinking Evidence-Based Policy

UK economic outlook: Brexit Britain in Covid recovery ward

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