Wendy Carlin's picture
Affiliation: 
University College London
Credentials: 
Professor of economics

Voting history

Euro Area Deflation and Risk for UK Economy May 2014

Question 1

Do you agree that there is a significant risk of a sustained deflation across the Euro Area in the coming two years?

Answer:
Disagree
Confidence level:
Confident
Comment:
Although I don't believe deflation is likely, the evidence of anchored inflation expectations supports the loosening of monetary policy by the ECB to boost growth in the Euro Area. Sustained very low inflation not only deflation is likely to depress growth expectations and growth.

Prospects for Economic Growth in the UK April 2014

Question 2

Do you agree that, in the wake of the financial crisis, any downward adjustment to the expected average annual long-term growth rate of the UK economy is likely to be by less than 0.25 percentage points?

Answer:
Disagree
Confidence level:
Not confident
Comment:
The exit of an economy from a financial crisis is not well understood (the cases of Japan and Sweden in the 1990s provide strongly contrasting examples - and there was not the complication of global effects at that time). The recent UK recovery is unbalanced but we have seen unbalanced growth continue for many years before.

Question 1

The long period of slow or negative growth might imply that there is a substantial output gap in the UK economy.  Do you agree that there is currently a larger output gap than the OBR estimate to the extent that the shortfall in output relative to capacity is 3% or greater?  

Answer:
Neither agree nor disagree
Confidence level:
Confident
Comment:
I remain puzzled by the productivity performance and wage behaviour of the UK economy over the past 5 years, which makes it difficult to take a strong view about the size of the output gap.

Responsible long-term fiscal policy (pilot survey)

Second question:

To help ensure that advanced country governments pursue responsible fiscal policies, countries should adopt formal rules for limiting structural deficits, which are supported by primary legislation or constitutional reform.

Answer:
Disagree
Confidence level:
Confident
Comment:
Unless crises of the kind recently experienced can be ruled out, this is not a sensible approach. A common approach to balanced budget rules across countries with different exchange rate regimes and with different wage setting institutions (which may provide scope for internal devaluation as a substitute for fiscal policy in stabilization) is not appropriate.

First question:

To help ensure that advanced country governments have sufficient flexibility to respond to future crises, it is important that finance ministries aim for a ratio of public debt to GDP that is substantially less than 60% in normal times.

Answer:
Disagree
Confidence level:
Confident
Comment:
Naming a target is an aspiration that is not very meaningful. Moreover it provides no guidance on the transition from where the economy is now to such a target. Better is to focus attention on the elements of a prudent fiscal policy, which ensures long run sustainability of the public finances, and allows for stabilization when necessary.

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