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

Voting history

Secular Stagnation

Question 2: Do you think that current structural and fiscal policies should place a considerably greater emphasis on pushing the natural rate into positive territory?

Answer:
Strongly Agree
Confidence level:
Confident
Comment:
Positive real rates would be part of a return to steady state. Greater emphasis on how to achieve this through more active structural policy would be welcome. To be specific, such structural policies would include deeper financial reform and reducing tax breaks for leverage (including sensible housing taxation).

Question 1: Do you agree- making your own definition of secular stagnation clear if you disagree with that offered here- that it is more likely than not that the advanced Western economies have entered into a period of secular stagnation?

Answer:
Disagree
Confidence level:
Confident
Comment:
There is more than one explanation for the configuration of slow growth, negative real rates and below target inflation. I suspect that private balance sheets and the unreconstructed financial sector are central to the stagnation. Is this within the 'secular stagnation' story? Since I don't agree that rising public debt and QE are obviously stimulative policies, then my interpretation is supply side / headwinds.

Migration and the UK economy August 2014

Question 1: Do you agree that migration to the UK can be expected to be beneficial for the average income of current UK inhabitants in the upcoming decade?

Answer:
Strongly Agree
Confidence level:
Very confident
Comment:
On average - yes, strongly agree. Distributional consequences are also important. They maybe hard to detect statistically, but they important to analyze - whether big or small.

UK House Prices and Macro-Prudential Policy July 2014

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Question 2: When housing-related risk is deemed excessive from the viewpoint of financial stability, do you agree that the correct response is to deploy macro-prudential tools, leaving interest rates focused on the needs of inflation and aggregate real activity?

 
Answer:
Disagree
Confidence level:
Confident
Comment:
My answer is because it depends on what one thinks is causing the excessive risk. If there has been a loosening of credit supply conditions, then macro-pru tools seem appropriate to influence supply. But if there is a high demand for mortgages because the cost of borrowing is held artificially low then just relying on a supply response may create further distortions. In this case deploying macro-pru tools and interest rates together would be more appropriate.

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Question 1: Do you agree it is time for more robust policy action to prevent a build-up of excessive housing-related risk?

 

 
Answer:
Disagree
Confidence level:
Confident
Comment:
While 10% house price inflation on a continuous basis would create problems, the current high level of prices follows three or four years of little growth. Moreover, some leading indicators suggest the house price inflation rate will slow considerably in coming quarters. It is hard to see how such little increase in lending can constitute a build up of significant risk. While more robust policy may prove necessary in time, I think it is hard to conclude that we have reached that time already.

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