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

Voting history

Brexit: the potential of a financial catastrophe and long-term consequences for the UK financial sector

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Question 2: What is the probability that the UK experiences such a significant disruption to financial markets and asset prices following a vote for Brexit on 23 June?

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Answer:
≈ 0%
Confidence level:
Confident
Comment:
Like most of the predicted economic gloom this too is an exaggeration. More significantly, the point of Brexit is the long-term, largely non-economic benefits, not short-term costs.

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Question 1: Do you agree that there would be substantial negative long-term consequences for the UK financial sector if the UK were to leave the EU?

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Answer:
Disagree
Confidence level:
Confident
Comment:
The fears expressed in the question are greatly exaggerated. The UK's financial sector has a global financial reach. This would not be affected. It would maintain's the UK's access to finance and expertise that the EU could not surplant.

The future role of (un)conventional unconventional monetary policy

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Question 2:  Do you agree that central banks should operationalise the use of these alternative tools of unconventional monetary policy for use either in the near term, or in the future, as economic conditions warrant?

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Answer:
Disagree
Confidence level:
Confident
Comment:
Given their ineffectiveness, there is no good case to use UMP at any time.

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Question 1: Do you agree that central banks should continue to use the unconventional tools of monetary policy deployed in response to the global financial crisis as part of monetary policy under normal economic conditions?

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Answer:
Disagree
Confidence level:
Very confident
Comment:
Even in the current abnormal conditions, uncoventional monetary policy has proved ineffective in stimulating private credit expansion. There is no reason to expect they would be more effective in normal times when in theory they would be unnecessary. To make matters worse UMP has distorted asset prices causing considerable asset market rebalancing and volatility. Although there is no good case for UMP, there is a good argument for using the new non-monetary tools to achieve financial stability, especially to prevent insolvency and banking excesses.

National Living Wage and the UK economy

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Question 2: Do you agree that the new NLW will have a muted effect on wages and prices?

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Answer:
Disagree
Confidence level:
Confident
Comment:
Higher labour costs where there are no improvements in productivity will lead to price increases. If these are followed by pressure for higher wages, a wage-price spiral could ensue and lead to a higher level of inflation.

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