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

Voting history

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:
Disagree
Confidence level:
Very confident
Comment:
I don't see any connection between the decision to release information at an earlier date and the frequency of meetings. Given the inactivity of the MPC over the last few years, having fewer meetings makes sense. If a crisis arose in the gap between meetings that requires the MPC to meet then I hope that the new timetable would not prevent such a meeting taking place.
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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:
Agree
Confidence level:
Very confident
Comment:
The earlier publication of MPC decisions is clearly advantageous. It is also helpful to know about the reasons for the decision and about the issues discussed. There is, however, still much merit in retaining anonymity on who said what. This is in order not to inhibit discussion on the MPC and to allow members "to change their minds if the facts change" without fear of public opprobrium..

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:
Disagree
Confidence level:
Confident
Comment:
Germany clearly thinks that the economic well-being of the eurozone is in allowing countries to continue to run large fiscal deficits. This must be correct in the long term. In the short term the danger has been that holders of Greek debt would suffer large losses. This has changed as there has been sufficient time for holders of Greek debt to rebalance portfolios should they have wished to do so. Consequently, Greece can be allowed by the eurozone to do what is best for Greece.

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Question 1: Do you agree that a Syriza victory on 25 January would lead to a significant or sustained escalation in spreads for other peripheral Eurozone countries?

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Answer:
Disagree
Confidence level:
Confident
Comment:
Although there may be some contagion in the short term, it is very unlikely to be sustained in the longer term. Logically an increase in spreads in other countries would only occur if the market expected these countries to default or leave the eurozone. But even the hardest hit of these countries would be unlikely to do so having already weathered the worst of the storm.

2014 Autumn Statement

 

Question 2: Do you agree that the underperformance of tax receipts in recent years, provides a strong case for higher taxes?

Answer:
Agree
Confidence level:
Very confident
Comment:
Prior to 2010 expenditures on the NHS, welfare and education doubled while taxes increased by just over half this. This is how public finances got into its present state. Not much seems to have changed in this respect. Sound long-term economic management requires that current expenditures like these should be paid for out of current taxation. The government (and opposition) plan future increases in NHS expenditures. The recession has kept tax receipts from wages from increasing and the pick-up in growth is yet to feed through to higher wages and tax revenues. As this is likely to persist for a few years, in order to reduce debt, it is necessary to raise tax rates in the interim. Only if the government could achieve its spending targets could this be avoided - which takes us back to the politics.

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