David Miles's picture
Affiliation: 
Imperial College
Credentials: 
Professor of economics

Voting history

Monetary Policy and Inequality

Question 2: What role should inequality play in the monetary policy decisions (interest rate policy and quantitative easing)?

Answer:
No role
Confidence level:
Confident
Comment:
Since there is no clear and consistent evidence of effects that in itself is an argument for it playing little role in policy making. Furthermore there are more direct and powerful tools - the tax and benefit system and the structure of public spending - to influence the distrubtion of income and wealth.

Question 1: How large is the impact of monetary policy on the joint distribution of income and wealth?

Answer:
Small
Confidence level:
Confident
Comment:
The effects of monetary poicy on incomes and welath come through several different channels (via demand and employment which affects wages and unemployment, via asset price effects which has more impact on the distrubtion of wealth than income, via shifts in income after interest payments, through knock on effects on rents and so on). These different effects are partilaly offsetting and are probabaly quite different at different points in business cycles. They also affect people of differeent ages in different ways - something which evens out over a person's life. So it is not surprising that there is no reliable, consistent and clear evidence of the impact of monetary policy on the distrubtion of income and welath.

Central Bank Digital Currency for the UK

Question 2: What effect will the introduction of a CBDC have on UK banks?

Answer:
Moderate harm
Confidence level:
Not confident
Comment:
Banks benefit from implicit and explicit insurance of bank retail deposits; this is probably not fully priced which helps them. Removing that insurance is made more feasible by CBDC and while banks might be net losers, overall there are net benefits.

Question 1: How beneficial would it be to the UK economy for the Bank of England to introduce a central bank digital currency in some form in the upcoming decade?

 

Answer:
Beneficial
Confidence level:
Confident
Comment:
Substantially reducing the risk of bank runs by providing a safe means of payment and a default free home for funds for the risk averse would remove the need to have deposit protection schemes. It would also remove the need for so much bank regulation and supervision designed to stop banks with retail deposits owned by very risk averse households taking inappropriate risks.

Fiscal Rules in the European Monetary Union

Question 2: Which of the following is the one reform you would choose to improve fiscal rules?

Answer:
Re-nationalization of fiscal discipline
Confidence level:
Confident
Comment:
Partial centralisation (either real or anticipated) of responsibility for making good on debt repayment of euro area government bonds is a bad place remain.

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