World Economics

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Will the Current Money Growth Acceleration Increase Inflation?
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Tim Congdon, World Economics, June 2020
The coronavirus pandemic has not only come as a profound shock to the major economies, but also exposed tensions between leading schools of thought. Uncertainty has arisen about the medium- and long-term consequences of the policy responses to COVID-19. Will the pandemic, and the consequent major upheaval in economic policy, lead to deflation or more inflation? This article—which is intended above all as a contribution to the emerging deflation vs. inflation debate—begins by discussing official policy in recent months. It then states a position in the tradition of the quantity theory of money and develops the argument that inflation will rise significantly in the aftermath of the pandemic.
On Measuring the Money Supply
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Steve H. Hanke, World Economics, March 2019
Oskar Morgenstern warned in The Limits of Economics (1937), that the formulation of economic policy was handicapped by the lack of relevant data and errors in its measurement. In this paper, the measurement of the money supply is used to illustrate Morgenstern's point. The most relevant measure of money for purposes of nominal national income determination is an inclusive, broad money metric. Most central banks fail to report the most inclusive broad money metrics, and what is reported are measured with the use of simple-sum aggregates. Divisia monetary aggregates are superior to simple-sum aggregates. These superior measures are used and data are reported for the United States by William A. Barnett at the Center for Financial Stability in New York.
Beyond the Shadow Economy
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George C. Georgiou, World Economics, September 2017
Money laundering is illegal world-wide and constitutes a significant economic inefficiency. Current anti-money laundering and combating the financing (AML/CFT) efforts are primarily driven by the threat of terrorism and drug-trafficking, but the majority of illicit money flows is due to fraud. This paper assesses the costs and benefits of controls on the efficiency of the financial system in modern advanced economies and the less developed economies of the world. The significant costs imposed on financial institutions, increasing levels of regulation and the minuscule illicit money flows intercepted has resulted in moral hazard and significant conflicts of interest.
Reply to Professor Zimmermann
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Giles Atkinson, World Economics, September 2000
Giles Atkinson replies to Professor Zimmermann’s "A Multi-coloured GDP -or No New GDP at All?"[World Economics, Vol 1 No 3 July-September 2000]
Owner-occupiers and the Price Index
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Ralph Turvey, World Economics, September 2000
The treatment of owner-occupied dwellings in Consumer Price Indexes varies between countries and is the subject of continuing controversy. Ralph Turvey explains the alternative possible treatments and reasons for disagreement.

The Black Economy - Benefit frauds or tax evaders?
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Jim Thomas, World Economics, March 2000
One answer to the question "How Rich are We?" is to compare levels of National Income either across countries or for a single country over time. However, the relevance of this approach depends on how accurately National Income measures the output of goods and services of a country. While it is difficult to measure, the Black Economy represents the output of goods and services that is not generally captured in the National Income Accounts. This article discusses the problems of measuring the size of the Black Economy and speculates on the questions of who is involved and how. The relative importance of Tax Evasion versus Benefit Fraud is discussed.

Extending the UK National Accounts
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Amanda Rowlatt, World Economics, March 2000
The national accounts measure economic activity. The UK is developing "satellite accounts" which use the framework of the national accounts but aim to quantify other aspects of living standards. This article starts by comparing satellite accounts with the use of indicators to measure the quality of life. It then reports on progress with the UK environmental accounts, and with the household accounts, which measure the productive unpaid work done in the home. It concludes with a discussion of the scope for developing a wider range of satellite accounts for the UK.

False Perspective: The UNDP View of the World
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David Henderson, World Economics, March 2000
Despite some searching and unanswered criticisms of its treatment of statistical evidence, the UNDP Human Development Report has become established as a widely-quoted and influential survey of the world scene. The 1999 Report, reviewed here, focuses on ‘globalization’. This is described as a dominant influence on the recent economic fortunes of developing countries in particular, and as a primary cause of continuing poverty and growing inequality in the world. The author argues that the Report provides neither argument nor evidence in support of this thesis; that it takes no account of other factors that have strongly influenced economic performance; that its main prescription for the world, of reforms in ‘global governance’, is largely beside the point; and that its whole approach is crudely anti-liberal. The author concludes by placing the Report, as also the economists who have aligned themselves with it, in the wider context of anti-liberalism today.

Displaying: 1-8 of 8