Macroeconomics: UK economy, IB Economics

Larry Elliott writes about the current state of play arguing with the UK economy highlighting the fact that despite the UK economy being on the brink of a recession, it seems that government policy is operating counter-intuitively - with interest rates rising and fiscal policy being contractionary. 

Why? Well he argues that a mixture of economic mismanagement and thrall to economic orthodoxy are going to mean that, just like the end of the 1920s and the start of the 1930s, the coming recession is going to be deeper than we anticipated. And perhaps then - as in the 1930s - we might start thinking about appropriate policy solutions.   

A remarkable statistic about UK productivity since the global financial crisis: the decline from pre-2008 growth trends was four times that or the 1930s, according to the Guardian. In reporting the latest paper by Nicholas Crafts and Terence Mills they highlight three things that have caused this: lasting damage to the financial system, smaller than anticipated gains as a result of IT and the uncertainty of Brexit. 

Larry Elliott again writing about whether the coronavirus outbreak marks the end of an era, and epoch-making change. He notes that the Great Depression triggered an ideological change, as did World War II and wonders whether the same is going to happen here, suggesting that perhaps ideas such as a Universal Basic Income no longer seem as radical as they once did. 

I'm not sure I agree, but food for thought.