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

Voting history

Wages and economic recoveries

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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?

A “new” UK industrial strategy ?

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

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Answer:
Neither agree nor disagree
Confidence level:
Not confident
Comment:
The problem faced by the regions outside the South East is the real exchange rate. The UK economy has become unbalanced due largely to the financial sector in London attracting capital and strengthening sterling. The other regions have found it difficult to export as a result. Regional policy won't help this but Brexit, and its effects on the financial sector, may. Better transport links would help the regions as would better internet connections, especially in rural areas. I am very skeptical about just giving money to local government.

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

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Answer:
Disagree
Confidence level:
Confident
Comment:
I am extremely skeptical about the likely effectiveness of such a policy. In the past, in the UK, it has proved a waste of money and I see no reason why it would be different this time. UK governments have not proved to be good at picking winners either in business and industry or in technology. Government should support research and development in universities and perhaps through tax breaks to industry. Evidence in favour of the role of government in industry is the work of Mariana Mazzucato for the US, but I think it unlikely that this would apply in the UK.

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