Michael Wickens's picture
Affiliation: 
Cardiff Business School & University of York
Credentials: 
Professor of economics

Voting history

Juncker's State of the Union Address

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Question 1; Do you agree that euro membership should be compulsory for all EU member states?

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Answer:
Strongly disagree
Confidence level:
Extremely confident
Comment:
Membership of the euro has proved disastrous for Greece, Ireland, Italy, Portugal and Spain as it has given them the wrong monetary policy and through persistently higher inflation and negative real interest rates caused a huge loss of competitiveness and fuelled over-borrowing and excessive indebtedness. Only if a country has an economic performance like Germany's can it flourish in the euro system

Wages and economic recoveries

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Question 2: Do you agree that the different behaviour of UK real wages relative to Eurozone wages during the Great Recession is in large part due to the UK having different labour market policies?

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Answer:
Agree
Confidence level:
Confident
Comment:
My explanation has been given in my answer to the first question.

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Question 1: Do you agree that lower real wage growth was beneficial for employment levels during the Great Recession?

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Answer:
Agree
Confidence level:
Confident
Comment:
Given that productivity has also been low over this period, the explanation is probably the level of high immigration, especially among the unskilled. Increasingly low wage unskilled jobs are being filled by immigrants. Given these low wages it is not surprising that Britons don't want these jobs. Instead of solving low real wages by investing and raising productivity, employers have preferred to encourage immigration.

Happiness and well-being as objectives of macro policy

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

 
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Answer:
Strongly disagree
Confidence level:
Extremely confident
Comment:
See previous answer. The objective is naive and there are no instruments to achieve such an objective.

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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?

 
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Answer:
Strongly disagree
Confidence level:
Confident
Comment:
Happiness might give further insights into the well-known limitations of GDP as a measure of welfare, but it should not be the focus of economic policy. There are several methodological reasons for this. 1. The original happiness literature was in reality a measure of unhappiness: envy over income differentials, illness, divorce, being unmarried etc. None of these is a natural macro policy objective. 2. There are no macro instruments to achieve greater happiness. 3. It suggests an extreme socialist agenda of income equality rather than conventional wealth generation. This would be a massive change in society's objectives which cannot be casually brought about by the Treasury's macro policy. It all reminds me of one of the low points in macro policy when in the 1970's many academics were pushing the argument that inflation was a sociological rather than an economic phenomenon. Is this another attempt to hijack macroeconomics?

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