Question 1: What impact has the sequence of fiscal rules adopted in the UK since 1997 had on the level of UK public debt?
Answer:
No impact
Confidence level:
Confident
Comment:
There is a strong (sometimes excessive) culture of attention to deficits and concern about the public debt in the UK. Chancellors particularly feel that talking the talk on deficits is the way to look "serious". They have also justifiably paid less attention to deficits in the first phase of the global financial crisis (but unfortunately began austerity far too soon) and the first year and a half of the Covid pandemic. Fiscal rules have merely ratified this norm, which would have maintained public debts and deficits pretty much at the same levels if policy was set via discretion.
Question 2: Which of the following policies is the most desirable to meet the ECBs objective to achieve its mandate of “price stability” as you understand this term.
Answer:
Inflation targeting
Confidence level:
Not confident
Question 1: To what extent do you agree with the following statement? “The European Central Bank should systematically allow for inflation to exceed its target to compensate for periods of below target inflation.”
Question 2: What role should inequality play in the monetary policy decisions (interest rate policy and quantitative easing)?
Answer:
Minimal role
Confidence level:
Confident
Comment:
The central bank should focus on price stability and fiscal policy should deal with income and wealth inequality, including those arising due to the distributional impact of monetary policy. Inequality should play a role in the BoE's considerations insofar as income and wealth inequality affect the transmission of fiscal policy.
Question 1: How large is the impact of monetary policy on the joint distribution of income and wealth?
Answer:
Small
Confidence level:
Confident
Comment:
Monetary policy reflects interest rate changes around a long-run neutral rate of interest. This neutral interest rate has important distributional implications but is mostly outside of the control of the Bank of England. If monetary policy is conducted appropriately, the interest rate will be above the neutral rate roughly as often as it is below, so will have only temporary or second order implications for the distribution of wealth and income. The only first-order impact, in my view, is the effect of monetary policy on unemployment, which the Bank of England already considers to some extent.
The CFM surveys informs the public about the views held by prominent economists based in Europe on important macroeconomic and public policy questions. Some surveys focus specifically on the UK economy (as the CFM is a UK research centre), but surveys can in principle focus on any macroeconomic question for any region. The surveys shed light on the extent to which there is agreement or disagreement among these experts. An important motivation for the survey is to give a more comprehensive overview of the beliefs held by economists and in particular to include the views of those economists whose opinions are not frequently heard in public debates.
Questions mainly focus on macroeconomic and public policy topics. Although there are some questions that focus specifically on the UK economy, the setup of the survey is much broader and considers questions related to other countries/regions and also considers questions not tied to a specific economy.
The surveys are done in collaboration with the Centre for Economic Policy Research (CEPR).
Post-Covid Fiscal Rules for the UK
Question 1: What impact has the sequence of fiscal rules adopted in the UK since 1997 had on the level of UK public debt?
ECB Monetary Policy and Catch-up Inflation
Question 2: Which of the following policies is the most desirable to meet the ECBs objective to achieve its mandate of “price stability” as you understand this term.
Question 1: To what extent do you agree with the following statement? “The European Central Bank should systematically allow for inflation to exceed its target to compensate for periods of below target inflation.”
Monetary Policy and Inequality
Question 2: What role should inequality play in the monetary policy decisions (interest rate policy and quantitative easing)?
Question 1: How large is the impact of monetary policy on the joint distribution of income and wealth?
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