Question 2: Which of the following policies would do the most to boost UK GDP in the medium term (over the next decade)?
Answer:
Boosting labour force participation
Confidence level:
Not confident
Comment:
I think the biggest single area for policy to boost growth is probably on the labour-market side. But my general view is that the fall in growth since the financial crisis (that, for me, is the turning point) has become entrenched with firms, households and policy makers all now pessimistic about the future. The big challenge for policy makers will be to shift the dial on that. Supply side headwinds are definitely a factor in that, particularly post pandemic when we have had a series of very negative supply shocks, but there will be a need for a range of policies to be used to get future growth up.
Question 1: Which of the following will be the most important constraint on UK potential output in 2023, relative to its pre-2019 trend?
Answer:
Labor force participation
Confidence level:
Confident
Comment:
With inactivity still nearly 500k above pre-pandemic levels this has been the biggest hit to UK potential since the pandemic. Still a big question about what will happen to participation going forward and the role of policy. For my money, the Bank of England's forecast of continued falls in participation look too gloomy - certainly relative to recent data - and there are reasons for thinking policy can shift the dial even if it is unlikely that many of the workers leaving the labour market during the pandemic will return.
Question 3: Should a windfall tax be used to (fully or partially) finance support to households?
Answer:
Yes
Confidence level:
Confident
Comment:
Classic (and pure) windfall for many energy producers means strong case for windfall taxes.
Question 2: Which of the following is the best way to address the impact of rising energy costs on household finances?
Answer:
Conditional/targeted transfers
Confidence level:
Very confident
Comment:
The key role for fiscal policy here is to provide targeted support for those who face hardship in the face of rises in energy prices that households could not foresee or hedge themselves against. Achieving that requires detailed information on household income and energy needs (the trouble is that, in practice, there is currently no mechanism for delivering this, hence the blanket price guarantees).
Question 1: Overall, which of the following best characterises how the government’s proposed energy policies will leave the average UK household over the medium term:
Answer:
Substantially better off
Confidence level:
Very confident
Comment:
Against a counterfactual of very sharp rises in household energy bills, the Government have provided huge (and expensive) support. See our (i.e. Resolution Foundation's) distributional analysis - Figure 5 in https://www.resolutionfoundation.org/app/uploads/2022/09/A-blank-cheque.pdf. The ex-post value of the EPG will depend on the market price of energy, however - and that remains extremely uncertain.
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).
Causes for Weak Long-Run UK Growth
Question 2: Which of the following policies would do the most to boost UK GDP in the medium term (over the next decade)?
Question 1: Which of the following will be the most important constraint on UK potential output in 2023, relative to its pre-2019 trend?
Assisting Households Facing Rising Energy Costs
Question 3: Should a windfall tax be used to (fully or partially) finance support to households?
Question 2: Which of the following is the best way to address the impact of rising energy costs on household finances?
Question 1: Overall, which of the following best characterises how the government’s proposed energy policies will leave the average UK household over the medium term:
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