The unintended consequence of English votes for English laws

2015 ◽  
Vol 233 ◽  
pp. R37-R44 ◽  
Author(s):  
Angus Armstrong ◽  
Monique Ebell
Keyword(s):  
Monetary Policy ◽  
Fiscal Policy ◽  
Member State ◽  
Unintended Consequence ◽  
The Other ◽  
Behavioural Responses ◽  
Policy Choices ◽  
Dominant Member ◽  
Scottish Government ◽  
The Uk

The Scotland Bill 2015–16 would make the Scottish government one of the most powerful sub-central governments in the OECD in terms of its control over spending and taxation. The UK government has also announced plans to introduce ‘English Votes for English Laws’ (EVEL), where the support of a majority of English MPs would be necessary to pass legislation deemed to impact on England only. The objective of this paper is to examine the potential for spillovers to arise in monetary unions of asymmetric nations where fiscal policy choices are taken locally. We extend a model of Chari and Kehoe (2008) to show the sub-optimal consequences of devolved fiscal policy in a moneteary union with a dominant member state. Because England is so much larger than the other constituent nations of the UK, its fiscal policy choices will have a commensurately stronger impact on UK monetary policy. As a result, UK monetary policy might be inappropriate for the smaller nations, calling into question the economic efficiency of EVEL. This is a general result which arises from the asymmetry of nations rather than specific UK funding arrangements or behavioural responses.

Swings and the Rules-Discretion Balance

2013 ◽  
Author(s):  
John B. Taylor
Keyword(s):  
Monetary Policy ◽  
Fiscal Policy ◽  
The Other ◽  
Macroeconomic Performance ◽  
Fiscal Stimulus ◽  
Policy Rules ◽  
The Past ◽  
Simple Rules ◽  
Economic Policymaking

This chapter examines two major swings in the balance between rules and the discretion of policymakers in U.S. economic policymaking in the past four decades: one in favor of rules and the other in favor of discretion. Evidence of the swing away from discretion is seen in actual fiscal policy and in the wide consensus among economists against the use of discretionary countercyclical fiscal policy in the 1980s and 1990s. The swing back toward discretion is found in the recent large discretionary fiscal stimulus packages and in deviations of monetary policy from the simple rules that described policy well in the 1980s and 1990s. Before elucidating the causes and effects of these swings, the chapter considers the economic and political rationale for policy rules. It suggests that the swing toward rules improved macroeconomic performance while the swing back toward discretion worsened it.

Ambedkar’s Educational Odyssey, 1913–1927

2019 ◽  
Vol 5 (2) ◽  
pp. 147-157
Author(s):  
J. Krishnamurty
Keyword(s):  
Monetary Policy ◽  
Fiscal Policy ◽  
Original Work ◽  
Doctoral Degree ◽  
The Other ◽  
Professional Qualification ◽  
Doctoral Thesis ◽  
Educational Achievements ◽  
Archival Material ◽  
Secondary Sources

I have attempted to provide an accurate timeline for Ambedkar’s incredible educational achievements between 1913 and 1927. Although there is wealth of literature on Ambedkar’s life, ambiguities and errors abound. I have therefore examined afresh archival material and secondary sources. Besides preparing several other manuscripts and papers in economics, Ambedkar secured his MSc and DSc degrees from London and published two major books, one on monetary policy and the other on fiscal policy. One was the basis on which he was awarded his Columbia PhD degree. It also appears that an earlier doctoral thesis draft prepared in 1917 was lost at sea. At the same time, he acquired his professional qualification as a lawyer, being called to the bar in 1920. Ambedkar’s relations with his supervisors were harmonious and he appears to have been treated well by them. Ambedkar produced a large and varied body of original work under the most difficult of conditions. In the light of the above the fact which I also establish that he was not the first Indian to obtain a doctoral degree in economics pales into insignificance.

Public investment, inflation persistence and central bank independence

2017 ◽  
Vol 44 (6) ◽  
pp. 976-986 ◽  
Author(s):  
Stephanos Papadamou ◽  
Eleftherios Spyromitros ◽  
Panagiotis Tsintzos
Keyword(s):  
Monetary Policy ◽  
Fiscal Policy ◽  
Central Bank ◽  
Public Investment ◽  
Central Bank Independence ◽  
Inflation Persistence ◽  
Content Type ◽  
Central Banker ◽  
Long Run ◽  
The Uk

Purpose The purpose of this paper is to investigate, both theoretically and empirically, the institutional setting of monetary policy making that mitigates the effects of productive public investment on inflation persistence. Design/methodology/approach In the theoretical approach, the authors consider a simple monetary game model à la Barro-Gordon introducing, apart from stochastic output shocks, indexed wage contracts and public investment effects. Then, the authors empirically produce inflation persistence and public investment persistence by estimating a first-order autoregressive model in a fixed rolling window of 36 months for the UK and also use a dummy in order to incorporate the regime switch in monetary policy since 1997, giving a clear increase in the level of central bank independence. Findings The theoretical framework suggests that an independent central banker could better manage inflation expectations and therefore inflation persistence despite the occurrence of persistent public investment shocks. From the perspective of fiscal policy, the appointment of a conservative and independent central banker could absorb adverse effects on inflation dynamics resulting from persistent expansionary fiscal policies. Empirical evidence in the UK indicates that the creation of an independent monetary policy committee reduces the positive link between public investment and inflation persistence. Practical implications From a monetary policy perspective view, the best response to public investment policies is to increase the degree of independence to alleviate effects on inflation dynamics. From the perspective of fiscal policy, an independent central banker can provide the necessary conditions to undertake a long-run public investment plan, since long-run growth will not be undermined by adverse inflation inertia. Originality/value The authors introduce, in the debate of inflation persistence, both theoretically and empirically, the role of public investment and monetary policy design.

Monetary Policy Under Labour

2010 ◽  
Vol 212 ◽  
pp. R15-R33 ◽  
Author(s):  
Timothy Besley ◽  
Kevin Sheedy
Keyword(s):  
Monetary Policy ◽  
Fiscal Policy ◽  
Financial Markets ◽  
Conceptual Framework ◽  
Inflation Targeting ◽  
Banking System ◽  
The Face ◽  
The Uk ◽  
Monetary And Fiscal Policy

This paper analyses Labour's record on monetary policy and the record of the MPC which it created. The paper begins by discussing the conceptual framework and institutions behind inflation targeting as it operates in the UK. We then discuss the successes that it enjoyed up to 2007 and debate the lessons that are being learned as a consequence of the experience since then. We then raise some of the formidable challenges that UK monetary policy must now face up to including maintaining the credibility of the inflation targeting regime in the face of greater interdependence between monetary and fiscal policy, and between monetary policy and support to the banking system and financial markets.

scholarly journals THE DEVELOPMENT EFFECTS OF THE MONETARY AND FISCAL POLICY IN CONTEMPORARY CONDITIONS

2019 ◽  
pp. 393
Author(s):  
Danijel Milošević ◽  
Vladislav Marjanović
Keyword(s):  
Decision Making ◽  
Economic Theory ◽  
Monetary Policy ◽  
Economic Policy ◽  
Fiscal Policy ◽  
Empirical Data ◽  
The Other ◽  
Standard Of Living ◽  
The Past ◽  
Monetary And Fiscal Policy

One of the biggest problems in economic theory has always been coordination of different elements of economic policy, especially monetary and fiscal policy. In the past, there have been a few theories emphasizing one of them, but in contemporary conditions it is a fact that the only right answer is in coordinated conducting of all of them. Therefore, every measure in monetary policy has to be followed by particular action in fiscal policy and the other way around. The question remains whether fiscal or monetary policy should have the priority in decision making and is there a pattern to follow when it comes to creating economic policy. Empirical data are the most purposeful source for answering these questions, and therefore we will use variables from four different countries from the last fifteen years and try to find the connection between monetary and fiscal policy and the standard of living.

The macroeconomic effects of monetary policy shocks under fiscal constrained

2020 ◽  
Vol 47 (4) ◽  
pp. 805-825
Author(s):  
Diego Pitta de Jesus ◽  
Cássio da Nóbrega Besarria ◽  
Sinézio Fernandes Maia
Keyword(s):  
Monetary Policy ◽  
Fiscal Policy ◽  
The Other ◽  
Household Welfare ◽  
Dsge Model ◽  
Content Type ◽  
Fiscal Rule ◽  
Macroeconomic Effects ◽  
The Government ◽  
The Cost

PurposeThis paper aims to analyze the macroeconomic effects of a monetary policy shock considering that fiscal policy is under fiscal constraints. For that, a dynamic stochastic general equilibrium (DSGE) model was developed for Brazil, which was estimated through Bayesian econometrics.Design/methodology/approachIn the basic model, the government does not have any type of fiscal restriction. The other two estimated models, however, consider that the fiscal authority implements some kind of fiscal rule. One of these rules is the Constitutional Amendment 95/2016 (EA 95/2016), which includes a limitation for government spending. The other Alternative Rule seeks to represent the characteristics of a more austere fiscal rule, as proposed by Wesselbaum (2017).FindingsIt was possible to verify in this paper that the implementation of EA 95/2016 by the Brazilian government does not produce statistically different results and that it reduces the welfare of the households in relation to the scenario without fiscal rule. Thus, the proportionate benefit of EA 95/2016 is less than the cost associated with this fiscal rule (less welfare). If the government adopts a fiscal constraint similar to the Alternative Rule, it is possible to considerably reduce the interaction between fiscal and monetary policy, thereby reducing the fiscal dominance policy over monetary policy. However, the cost in terms of welfare is much higher than the baseline scenario. Thus, the fiscal authority is subject to a trade-off among public debt stabilization and household welfare.Originality/valueThe study intends to contribute to the literature on three specific points. First, the monetary–fiscal policy interaction within a representative model of the Brazilian economy is discussed. In addition, the study considers that the government can adopt EA 95/2016 and the Alternative Rule, used in the US economy. Second, the impacts of EA 95/2016 and the Alternative Rule on household welfare will be quantified. Finally, two types of individuals (Ricardian and non-Ricardian agents) and two sectors of production (wholesalers and retailers) are considered. In this paper, the DSGE model is estimated, since the previously mentioned authors performed simulations

Social Democracy and Globalization: The Cases of France and the UK

2002 ◽  
Vol 37 (4) ◽  
pp. 466-500 ◽  
Author(s):  
Ben Clift
Keyword(s):  
Monetary Policy ◽  
Fiscal Policy ◽  
Global Economy ◽  
Social Democracy ◽  
Macroeconomic Policy ◽  
Social Democratic ◽  
Globalized Economy ◽  
The Uk ◽  
The Relationship

This Article Explores The Nature Of Contemporary Social democracy, questioning, with like-minded scholars, John Gray's interpretation of the relationship between social democracy and globalization, which asserts that social democracy is a historically exhausted project. Garrett, for example, in rejecting such assertions, argues that social democracy remains a distinctive and viable ‘project’ within the global economy, specifically in cases where strong left-of-centre parties are linked to ‘encompassing labour movements’. He has subsequently argued that social democracy in ‘Euroland’ (with or without encompassing labour movements) can pursue a less constrained fiscal policy, and expect a more accommodating monetary policy than some predict. Garrett thus insists that social democratic governments within the Eurozone are able to ‘use macroeconomic policy to lessen market dislocations and to redistribute wealth and risk in the ever more globalized economy’.

scholarly journals The New Challenges of Inflation and External Imbalances Facing China

2008 ◽  
Vol 7 (2) ◽  
pp. 34-50 ◽  
Author(s):  
Yongding Yu
Keyword(s):  
Growth Rate ◽  
Monetary Policy ◽  
Fiscal Policy ◽  
Chinese Economy ◽  
Sustainable Growth ◽  
The Other ◽  
External Demand ◽  
Sustainable Growth Rate ◽  
New Challenges ◽  
The U.S

China is facing the threat of inflation, at the same time that the U.S. economy is in trouble. To maintain a sustainable growth rate, China must walk a tightrope. On one hand, China must tighten its monetary policy to bring inflation under control, which will slow down the growth rate of the Chinese economy. On the other hand, China also has to be ready to use expansionary fiscal policy to replace the weakened external demand to prevent its economy from falling into a “growth recession,” where the growth rate is below 8 percent, due to the double whammies of monetary tightening and a significant slowdown of the U.S. economy.

scholarly journals Unleashing Workplace Innovation in Scotland

2018 ◽  
Vol 4 (1) ◽  
Author(s):  
Peter Totterdill ◽  
Rosemary Exton
Keyword(s):  
European Union ◽  
The Other ◽  
Work Organisation ◽  
The European Union ◽  
Short Article ◽  
The United Kingdom ◽  
Workplace Innovation ◽  
Scottish Government ◽  
Economic Developments ◽  
The Uk

Amid the turbulent political and economic developments around the British departure from the European Union (Brexit), practical activities around Workplace Innovation have continued. The UK Work Organisation Network established Workplace Innovation Ltd, which is now based in Dublin as Workplace Innovation Europe. This short article describes the promising new programme of work on Workplace Innovation in Scotland, working with the support of the Scottish Government. In the uncertainty of the months and years ahead in the UK, Scotland can offer a lead which can be followed by the other regjons and nations of the United Kingdom.

Devolution and Entrenched Household Poverty: Is Scotland Less Mobile?

2009 ◽  
Vol 8 (3) ◽  
pp. 367-377 ◽  
Author(s):  
Carlo Morelli ◽  
Paul Seaman
Keyword(s):  
United Kingdom ◽  
The Other ◽  
National Party ◽  
Total Income ◽  
Scottish National Party ◽  
The United Kingdom ◽  
Household Poverty ◽  
Scottish Government ◽  
The Uk

The Scottish National Party led Scottish Government has identified household poverty as a key focus for its anti-poverty strategy. The government's ‘Solidarity Target’ seeks to both increase wealth and increase the share of total income gained by the bottom three deciles. The ability to demonstrate the advantages of policy divergence within Scotland, relative to the other parts of the United Kingdom, is central to the government's aim of gaining support for increased powers for the devolved government. This paper seeks to provide evidence on one aspect of the government's anti-poverty strategy: the degree to which Scotland differs from the rest of the UK over levels of entrenched poverty. The paper demonstrates that not only does Scotland have greater entrenched poverty but that the changes in mobility since the 1990s have impacted on Scotland to a lesser degree than the rest of the UK.

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