You’re all poor now, says Bank boss
Posted: Tue Apr 25, 2023 9:13 pm
Suck it up sunshine
It's called the Dismal Science for a reason.
Like bank bosses, you mean?IvanV wrote: Wed Apr 26, 2023 9:45 am We are collectively poorer. What he fails to acknowledge is the reasonableness of an attempt to redistribute the impact. Especially when it seems that many of the upper echelons of the income/wealth distribution have escaped largely unscathed, so far.
Surely there must be theories about the marginal utility of money itself? A pound to a pauper is much more important than a pound to a king.IvanV wrote: Wed Apr 26, 2023 9:45 am We are collectively poorer. What he fails to acknowledge is the reasonableness of an attempt to redistribute the impact. Especially when it seems that many of the upper echelons of the income/wealth distribution have escaped largely unscathed, so far.
Indeed there are, and very well established. To the extent that you are supposed to take explicit account of it when appraising public spending in Britain. Guidance is set out in the Treasury Green Book, which is the manual on how to appraise spending proposals to show they are coherent and represent value for money. The book explicitly sets out how to put a monetary value on a change in income distribution, where a proposal has such an effect. It even specifies the value for the parameter that describes the marginal utility of income, which is sourced to the academic literature. And it is a academically plausible value. It is just the same parameter I chose, based on the exactly the same research I selected, when I needed such a value because earlier editions of the Green Book left that value unstated.bjn wrote: Wed Apr 26, 2023 11:47 amSurely there must be theories about the marginal utility of money itself? A pound to a pauper is much more important than a pound to a king.IvanV wrote: Wed Apr 26, 2023 9:45 am We are collectively poorer. What he fails to acknowledge is the reasonableness of an attempt to redistribute the impact. Especially when it seems that many of the upper echelons of the income/wealth distribution have escaped largely unscathed, so far.
Are you calling that plague on the Chief Economist of the Bank of England who made the initial statement? Or on me for my response to it? Or on all of us for explicitly debating something you think shouldn't be talked about in this way?
It's like the economic news headlines that seem to decry high wage inflation, due to low unemployment. Or articles about how the pension system is f.cked because people aren't dying early enough.El Pollo Diablo wrote: Wed Apr 26, 2023 1:26 pm Well, the Chief Economist guy mainly, but you're all thinking it deep down
I move mainly in the circles of policy/transport/energy/health type economists, and my experience is that few of them are like that. But I can suspect that city/bank type economists might be rather different.El Pollo Diablo wrote: Wed Apr 26, 2023 1:26 pm Well, the Chief Economist guy mainly, but you're all thinking it deep down
That is truly extraordinary, and we know who's to blame, and the people to blame and their supporters are keeping very quiet about it.Had the pre-crisis [2008] trend continued, the typical Brit would by now be 40 per cent richer.
This episode of Volts considers the economics of US government policy, with a section on distribution.IvanV wrote: Wed Apr 26, 2023 1:10 pmIndeed there are, and very well established. To the extent that you are supposed to take explicit account of it when appraising public spending in Britain. Guidance is set out in the Treasury Green Book, which is the manual on how to appraise spending proposals to show they are coherent and represent value for money. The book explicitly sets out how to put a monetary value on a change in income distribution, where a proposal has such an effect. It even specifies the value for the parameter that describes the marginal utility of income, which is sourced to the academic literature. And it is a academically plausible value. It is just the same parameter I chose, based on the exactly the same research I selected, when I needed such a value because earlier editions of the Green Book left that value unstated.bjn wrote: Wed Apr 26, 2023 11:47 amSurely there must be theories about the marginal utility of money itself? A pound to a pauper is much more important than a pound to a king.IvanV wrote: Wed Apr 26, 2023 9:45 am We are collectively poorer. What he fails to acknowledge is the reasonableness of an attempt to redistribute the impact. Especially when it seems that many of the upper echelons of the income/wealth distribution have escaped largely unscathed, so far.
I have actually done a couple of appraisals that take explicit account of the income distribution, in part because those policies were being justified substantially for their income distribution effect, or in fact protecting against the negative distributional effect of another policy. But is quite rare actually to do so. But I think when you get into areas of policy that have the largest impact on income distribution, like tax and benefits policy, no such assessment would be done. Because the methodology would clearly suggest a large leveling up on incomes through redistribution which few politicians in this country have any intention of arguing for.