Angus Armstrong's picture
Affiliation: 
National Institute of Economic and Social Research
Credentials: 
Director of Macroeconomic Research
Visiting Professor, Imperial College London

Voting history

COVID-19 and UK Public Finances

Question 2: What is the best way to (eventually) reduce public deficits and debt?

Answer:
Higher inflation
Confidence level:
Very confident
Comment:
Targets and rules have become immutable, and now part of the problem in complex system.

Question 1: How urgently should the UK government address the rise in public debt?

Answer:
There is no need to take or announce any budgetary actions to reduce the deficit or the public debt until the end of the pandemic
Confidence level:
Extremely confident
Comment:
Over insuring in a crisis usually pays dividends.

The Eurozone COVID-19 Crisis: EU Policy Options

Question 2: What is the best mechanism to pay for economic support provided by and to EU member states to combat the COVID-19 crisis?

Answer:
Joint borrowing by member states (e.g. Coronabonds)
Confidence level:
Confident
Comment:
This is the logical answer for a monetary union to succeed over the longer term.

Question 1: What is the total size of funding that you would advocate at the EU level in support of its members to weather the COVID-19 crisis this year?

 

 

Answer:
10-20% of GDP
Confidence level:
Not confident
Comment:
This would constitute a huge one year budgeted package. However, I have low confidence in my answer because it depends on the form of the package. If this were a full transfer from North to South, this would signal a federal Europe. If instead it is a loan or has implausible conditionality then this may not be enough.

Covid-19: Economic Policy Response

Question 3: Which would be the maximal public debt you would be willing to tolerate if used effectively (as in your answers to 1 and 2 above) to support an economic recovery?

Answer:
>140% of GDP
Confidence level:
Very confident
Comment:
Everything is contingent on the disease, but protection of citizens is the first job of the state. Failure to do so would lead to anarchy and so I do not think an upper bound can be guessed without a clear statement of the upper bound on the disease which we are yet to know (e.g., some epidemiologists expect secondary waves of infection).

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