If AI solved Baumol’s Cost Disease, that would be GOOD

Let us start with some generally accepted facts: So: hope at last? You would think so. And there are two prominent Labour facing think tanks pondering and publishing on this very topic: the IPPR with “Transformed by AI” and Tony Blair Institute’s “Accelerating the Future”. With Labour currently forecast to enjoy a 300 seat majority,

Final thoughts on the £28bn

I promise this is the last of it. If you have the time, listen to Osborne and Balls on their podcast discussing the £28bn U-turn.  I missed it, but Ed Balls apparently said that for U-turns to work, they have to be big and ugly, and that way the voters really notice, and that is

We didn’t buy pandemic insurance and can’t forever pretend that we did

Several aeons have passed since I began thinking about covid-19 bailouts (IFG pamphlet out shortly, watch this space), and still I struggle to get my thoughts straight.  During that time, the blogosphere and in particular VoxEU have drenched us in high-speed, quality thought, even as the facts on the ground have shifted at speed.  Just

When did the Great Recession start?

If you put this question to most economists at the tail end of 2008, they would have said “around the time Lehman Brothers collapsed”. The last Inflation Report of the year showed things flat in Q2, and then that first bad quarter in 15 years in 2008Q3.  However, the latest data from the ONS suggests it got far worse

A hangover without a party pt1

One of my constant gripes with economic debate is how it gets reframed in moralistic terms.  All parties tend to be guilty of this. For the Left, it was about some sin at the heart of capitalism, about the wicked behaviour of certain bosses and bankers.  For the right, we all just consumed too much,

Defending the Bank of England

It is looking pretty dicey for the Bank and it’s inflation-fighting reputation.  Read Jeremy Warner (Does the inflation target actually mean anything any more?) and above all the point made clear in Simon Ward’s post yesterday (UK CPI inflation 3 percentage points above BoE year-ago forecast).  Here is a graph from last year’s May Inflation

I won’t deny it: the inflation figures suck

Here is the BBC story; here is where you can get the data. The BBC mentions volcanic ash driving up Food prices. But as far as I can see, the things that rose hardest from March to April were not particularly vulnerable to delayed flights: (correct me if I am wrong: I did that graph

Crazy spending, or our lifeline?

To no great surprise, David Cameron has announced an immediate audit of the ‘crazy’ spending of Labour’s last years in power.  Politically, this no doubt makes great sense – “look what those idiots got up to” is perfect scene-setting for the blood-letting that will follow.  But what worries me is what sort of a narrative

Some stuff to add learning and entertainment to a sunny weekend

Sorry, I am in a sunny mood. Martin Wolf is also infected with the sun, because he comes out with a surprisingly generous verdict on The economic legacy of Mr Brown. The general theme is that his mistakes were shared by most of the economic policymaking world, and Wolf makes this telling point: “In retrospect,

‘Labour’s electoral strategy’ – and a call for Empiricism

Given that the next election is possibly 5 years away, am I the only one to find arguments about Labour’s election strategy just a little premature?  I keep trying to remember what such discussions must have been like for the Lib Dems in 2005, and then find I can’t.  Because five years is such a