Michael McMahon's picture
Affiliation: 
University of Warwick
Credentials: 
Associate Professor of Economics

Voting history

Happiness and well-being as objectives of macro policy

====================================================================

Question 2: Do you agree that quantitative well-being analysis should play an important role in guiding policy makers in determining macroeconomic policies?

 
====================================================================
Answer:
Neither agree nor disagree
Confidence level:
Not confident
Comment:
I am enthusiastic that such well-being analysis can shed light on under-considered interlinkages that matter for macro policy. For example, there is emerging evidence that happier workers are more productive (Oswald et al ) and so when thinking about the UK productivity puzzle, thinking about industrial policy and R&D incentives should be combined with thinking about reforms to improve mental health support over workers lives. Such research may also affect decisions about the rate of adjustment in social welfare programs. Too fast a reduction in benefits, or other policy changes which cause larger stresses (for example to working parents) may be associated with negative productivity consequences. A concern also relates to the Lucas critique. Most of the research that I am aware of from well-being analysis concerns the analysis of historical relationships. While these have shed light on (in many cases causal) relationships, we cannot be certain of the robustness of such relationships in the face of targeted policy changes. So while I welcome the use of such quantitative well-being analysis as complements to the current processes used to evaluate macro policies, I remain somewhat more cautious about the current precision of such analysis to use it as the core way to determine policies.

====================================================================

Question 1: Do you agree that subjective well-being measures, or at least some of the subindices from the typical survey measures, are now reliable enough to give useful insights when used in macroeconomic empirical analysis?

 
====================================================================
Answer:
Agree
Confidence level:
Confident
Comment:
I believe that they give useful information on higher frequency movements. As such this may be an advantage over many macroeconomic time-series given that surveys could be done more frequently than just annually or quarterly. As such, I think they would be useful for business cycle analysis. My concern with the measures relates to the ability to pick up up lower frequency movements. For example, slow-moving but significant increases in longevity may not be reflected in the measures. As such it is less clear that these measures are as useful in the analysis of longer-term trends.

A “new” UK industrial strategy ?

====================================================================

Question 2: Do you agree that the UK needs a new regional policy?

====================================================================

Answer:
Agree
Confidence level:
Very confident

====================================================================

Question 1: Do you agree that the UK needs a new industrial policy?

====================================================================

Answer:
Agree
Confidence level:
Very confident
Comment:
The UK has for many years struggled with weak productivity. There are also significant regional challenges with some regions poorer and with higher unemployment / lower employment. A new industrial policy that encouraged the establishment of sustainable local economies which are themselves interconnected to the rest of the UK could at least help the latter issue. If such policies encouraged more dynamically-growing industries, then they could even help the former productivity issue.

The Future of Central Bank Independence

====================================================================

Question 3: More generally, do you agree that it is desirable to maintain central bank independence? Again focus on the near future, say next 48 months.

====================================================================

Answer:
Strongly agree
Confidence level:
Very confident
Comment:
As outlined above, I believe that monetary policy and other central bank policies should be kept free of manipulation for political gain. I also believe that monetary policy independence should be maintained to avoid concerns that that government is trying to regain control of monetary policy for such manipulation.

Pages