Sir Charles Bean's picture
Affiliation: 
London School of Economics
Credentials: 
MA Cambridge
PhD MIT

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:
Extremely confident
Comment:
Distributional issues are at the heart of politics and distributional questions should be decided by politicians not the unelected technocrats who staff central bank policy committees. If the distributional consequences of meeting the central bank's policy objectives (monetary and financial stability) are unacceptable, then in the first instance the government should use its fiscal tools to offset them. In the UK context, if the Chancellor were unhappy with the distributional consequences of setting monetary policy at the level necessary to meet the inflation target then he could also choose to exercise his override option. But in that case it would be clear that the decision was being made to 'aim off' the inflation target for distributional reasons and the responsibility for that decision lay with the political rather than the monetary authorities.

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

Answer:
Small
Confidence level:
Not confident
Comment:
The impact is potentially ambiguous and likely to be state-dependent. In particular, looser monetary policy tends to benefit those without jobs as well as benefitting those with assets (and vice versa). In addition, it should be remembered that, broadly speaking, central banks are setting policy so as to keep output near potential and inflation at target. So it is wrong to think of monetary policy as an independent influence on inequality. It is instead the necessary reflection of all the other factors that affect demand and supply in the economy (i.e. the determinants of 'r*', the equilibrium real rate of interest).

Central Bank Digital Currency for the UK

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

Answer:
Moderate benefits
Confidence level:
Confident

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

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:
Fiscal councils or fiscal standards
Confidence level:
Confident

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