Ethan Ilzetzki's picture
Affiliation: 
London School of Economics

Voting history

The Importance of Elections for UK Economic Activity

Question 2: Do you agree that the outcome of the general election will have non-trivial consequences for aggregate economic activity (employment and GDP)?

Answer:
Neither agree nor disagree
Confidence level:
Not confident
Comment:
My response is based on both political and economic factors. On the political side, my current expectation is of hung parliament. Whoever will govern will have difficulty in setting a clear agenda. From an economic perspective, no party has put forth proposals that are a magic bullet for the UK's long term economic challenges. Overall, the public tends to overstate the ability of governments to affect economic outcomes in the short run--except in some extreme cases. I do see a couple of downside risks. These include a referendum on the EU that creates economic uncertainty and populistic anti-imigration policies.

Question 1: Do you agree that the austerity policies of the coalition government have had a positive effect on aggregate economic activity (employment and GDP) in the UK?

Answer:
Strongly Disagree
Confidence level:
Extremely confident
Comment:
There was no evidence of any need for austerity when the UK embarked on this path. Interest rates were at historical lows and there was no indication that the UK debt burden was a drag on growth. The UK's recent stronger economic performance perfectly coincided with a recovery elsewhere in the world, including in the US which followed a path of stimulus, not austerity. The recovery was also in the context of oil price that were very low.

Transparency and the Effectiveness of Monetary Policy following the Warsh Review at the Bank of England

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Question 2: Do you agree that the Bank's proposal to release the policy decision, MPC minutes and (once a quarter) the Inflation Report all at the same time justifies a change in the structure of MPC meetings from two consecutive days to a process in which in the MPC meetings are spread out over seven days?
 
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Answer:
Neither agree nor disagree
Confidence level:
Not confident
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Question 1: Do you agree that the simultaneous release of the policy decision, the enhanced minutes (including the voting record) of the MPC meeting and (in the relevant months) the release of the Inflation Report will facilitate inference on the likely stance of monetary policy?
 
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Answer:
Neither agree nor disagree
Confidence level:
Not confident
Comment:
As an academic, I don't require MPC information at a frequency where this distinction matters. I can't assess how this affects market participants.

Greece’s elections and the future of the Eurozone

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Question 2: Do you agree that refusal of the core EU countries to a renegotiation of the Greek bailout agreements would carry serious risks for the economic well-being of the Eurozone?

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Answer:
Agree
Confidence level:
Confident
Comment:
Core EU countries should preempt a Syriza victory and offer to renegotiate Greek sovereign debt regardless of the outcome of the election. Exceeding 150% of GDP, Greek debt is not sustainable, but at this point the vast majority of this debt is owed to the EU (almost 100% of GDP owed to EFSF or in bilateral loans). Greece's debt burden is therefore a core-EU decision variable. These loan facilities have prolonged the maturity of Greek sovereign debt, but more can be done to lower the current debt burden of the Greek government. These could be tied to further measures to build Greece's tax collection abilities. The fallout from a Greek default or exit from the Eurozone is uncertain, but does entail some large tail risks. The costs of lowering Greek debt burden are small in comparison.

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