Summer 2024 Newsletter


A UK spending watchdog? Institutional design on the national level The UK can call itself lucky that it has a world class fiscal watchdog in the form of the Office for Budget Responsibility and numerous excellent think tanks analysing economic policies. But is there a need for an official independent (parliamentary) body to cost political parties’ election manifestos? The recent row between the Labour and Conservative parties over each other’s manifestos has highlighted this issue. Numerous countries including Australia and the Netherlands have come up with solutions; perhaps some food for thought for the next government.

Economics and ethics Do economists have a particular responsibility towards society? In its June 2024 Finance and Development Magazine, the IMF asks whether economists, like medical doctors, should take an oath on ethics. Should this be rolled out to all analysts? Given the positions of influence they hold it is an interesting reminder …. Would you take such an oath?

Keep on spinning – Blue Monday, Black Wednesday, Simply Red We all care about the latest inflation numbers but let’s go beneath the surface. Fast forward at 78rpm: since March vinyl records are back in the consumption basket used to calculate inflation. This is a remarkable comeback: the last time vinyl was important enough to matter for inflation was in 1992. This was the year John Major won a fourth successive general election for the Conservative Party, the Maastricht Treaty paved the way for the European Union and Single Market, Black Wednesday forced the UK out of the Exchange Rate Mechanism, and the English Premier and European Champions Leagues were established. It seems that everything eventually turns full circle: what next?

Bretton Woods turns 80. Institutional design on the global level Exactly 80 years ago during the final stages of the 2nd World War, delegates from 44 countries, the UK represented by Lord John Maynard Keynes, met in Bretton Woods to discuss a post-war global financial architecture. At the conference the foundations for the World Bank and the International Monetary Fund were laid. The World Bank and IMF have been rightly or wrongly criticised in the past (‘Washington Consensus’) but most would agree that they need to adapt to 21st century circumstances. Faced with a myriad of global challenges including climate change, and demographic and technological transformations, how can governments work together in a world of fragmentation? What would an international financial architecture fit for the next 80 years look like? Questions on institutional design don’t get bigger than that.

Green Book: Multi-Criteria Decision Analysis (MCDA) Updated supplementary Green Book guidance on MCDA has been published. MCDA is a method used to support decision-makers choose between options where there are several objectives – potentially conflicting. The technique benefits from direct involvement from key stakeholders and policy experts in assessing different options. While not considered a replacement for Cost-Benefit Analysis, the latest guidance outlines where and how you can use it in government appraisal.

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