Philip Hammond has recently made a rather startling confession for a Conservative Chancellor of the Exchequer: that 'the market' is currently failing fairness tests in the distributional outcomes it is producing in the UK. However, his solution saw him quickly restored to partisan type, idealising 'textbook' market institutions and setting as the future goal returning to the way market outcomes are 'supposed to' operate. This SPERI Comment blog post highlights the continued reification of ideal-typical market constructions within Conservative Party political rhetoric. 'The market' is still capable of producing the best possible outcomes, Hammond seemed to be saying, even if the Government of which he was a key member had found it impossible to secure the conditions under which this might be so.
On June 7th 2019 I had a post published on the LSE's British Politics and Policy blog site. It is called 'Michael Gove's War on Historians: Extreme Whig History and Conservative Curriculum Reform'. It follows closely the argument in my recently published British Politics article which looks at the controversial role of imperial 'heroes' in the most recent national curriculum in history. It asks whether white settlers and their often brutal means of settling are really the most appropriate role models for children in a modern multicultural society, as well as how far access to the character of the country these children call home is restricted when treating Empire simply as a symbol of British greatness.
George Osborne was a purveyor of machonomics, an approach to economic policy-making revolving around seemingly bottomless reserves of macho self-confidence. In this blog post for the LSE British Politics and Policy blog site, I argue that Osborne modelled himself in this way on the optimal policy-maker of the so-called time consistency problem of abstract economic theory.
This post showcases the analysis contained in my recent British Politics article on the same theme. It is available in open access view-only format from Springer Nature's Shared It facility.
The question of why uncertainty does not feature more prominently as an economic ontology requires answers that are rooted in intellectual history. This post, the sixth in the SPERI series on uncertainty, searches for them by looking at how economic history has become increasingly colonised by economic theory, and economic theory by mathematics.
Recent criticisms of the mathiness of many economists has raised the question within the blogosphere of whether a fundamental fault-line has now punctured economics orthodoxy.
In July 2016 I was invited to the Firesouls office in London by Dan Ebanks, the company's co-founder and CEO. Firesouls has built the Social Value Exchange, an e-auction that enables community groups to bid for resources that might have a transformative effect on the way in which life is lived locally. Dan recorded the conversation that we had about my project research, in the hope that my work on the market concept might serve as useful background information for what Firesouls is trying to do with its Social Value Exchange. The first part of that conversation was posted on the Firesouls blog site on March 7th 2017, with a further part to come.
This is the second of the two-part blog post that OUP published on its website on October 6th 2016 to accompany the release of the seventh edition of Baylis, Smith and Owens's The Globalization of World Politics. It is entitled, 'Brexit and Article 50 Negotiations: Why the Smart Money Might be on No Deal'.
In August 2016 I was invited by Oxford University Press to do some filming for their website, answering questions on Brexit. This was to help them in their advertising for the seventh edition of Baylis, Smith and Owens's The Globalization of World Politics, to which I am a contributing author for the chapter on Global Trade and Global Finance. These are two dimensions of the modern-day phenomenon of economic globalisation that will definitely be impacted on by the UK's decision to withdraw from the European Union.
As a follow-up to my afternoon filming, I was then asked to write two blog posts for the OUP website. The first was published on September 25th 2016, and is called, 'Brexit and Article 50 Negotiations: What it would take to strike a deal'. This post, along with the accompanying film, can be found via the following link.
Fools' Gold Blog Post on Friedrich List's Role in the Pre-History of Modern-Day Competitiveness Thinking
Friedrich List never once mentioned competitiveness directly by name, but he nonetheless remains an important figure in the pre-history of the Competitiveness Agenda. It would be impossible to present a comprehensive account of the rhetorical structure underpinning that agenda without at least some discussion of his National System of Political Economy. It was List who first made the case in the 1840s for collective national sacrifice in the interests of stronger future macroeconomic performance. There is no plausible philosophical mechanism in his work to explain why people should agree to the privations following from this sacrifice, in much the same way that no plausible philosophical mechanism operates in the modern-day Competitiveness Agenda to explain why the population should remain passive in the face of a race to the bottom. His argument for choosing national economic champions in the name of future society-wide enrichment therefore looks like an unsubstantiated assertion, and the same surely also applies to the Competitiveness Agenda.
There are many instances in the history of economic thought where economists did not use what today has become the concept of ‘national competitiveness’ but nonetheless wrote about things that look eerily familiar when viewed through the lens of the modern-day Competitiveness Agenda. Veblen’s 1904 Theory of Business Enterprise contains many important passages of this nature. Business leaders, he noted, had become remarkably successful at presenting themselves as the selfless foot soldiers in a national struggle for international economic pre-eminence. Yet for Veblen this was all a carefully constructed smokescreen. They could hardly be seen as guardians of the national interest, he argued, because they enacted significant damage on the economy’s social provisioning capacity in the self-serving desire to protect the social inequalities from which they benefited so handsomely.
On November 10th 2015 the Naked Capitalism website published an update of my earlier Fools' Gold blog post exploring the relationship between the contemporary competitiveness agenda and the growth profile of the national economy. Once again the emphasis of the argument is on labour, more particularly how full-scale submission to the competitiveness agenda impacts on labour in ways that undermine both the demand-side and supply-side dynamics of growth.
The purveyors of the modern-day Competitiveness Agenda exhibit pronounced Panglossian tendencies. They see only positive things for everyone if their advice is followed. A ‘competitive’ economy will boast high levels of growth, they say, and the whole of society will benefit when the trickle-down effects impact on their lives. However, this Panglossian scenario elevates optimism over evidence. The modern-day Competitiveness Agenda can be turned on its head in the interests of a more progressive social settlement by exploring its fundamental anti-growth dynamics.
The Nobel Prize winning economist George Stigler wrote a famous intellectual history of the concept of perfect competition in the late 1950s. The article has subsequently attained canonical status among orthodox economists. It does not mention the contemporary notion of competitiveness once, but it is nonetheless full of important implications for those who wish to question the intellectual authority of the modern-day competitiveness agenda. In particular, Stigler is forced to admit that there is no purely economic basis for supporting the idea of a perfectly competitive economy. His argument that there are still good grounds for keeping up this pretence boil down to straightforwardly political beliefs for wanting to keep the government out of economic life. Despite what can be shown to be their important differences, this is one thing that the theory of perfect competition and the modern-day competitiveness agenda have in common. Both are typically dressed in apparently economic clothes, but each in its own way must be understood as a purely political intervention into public affairs.
Fools' Gold Blog Post on Milton Friedman's Grand Denial of the Social Responsibility of Corporations
The legendary Chicago economist, Milton Friedman, was not somebody to do anything by halves. Where others before him had shied away from even thinking aloud about the limits of firms’ responsibilities to those around them, Friedman waded into the debate with both feet. Corporations can serve society best, he stated, by cutting their costs to the bone and accordingly by making as much profit as possible. This argument did not reference competitiveness directly in its original articulation, but it acts as an important forerunner of modern-day competitiveness discourse. Corporations that deny their broader social responsibilities, Friedman argued, set themselves on the road to a truly competitive zero rate of taxation.
Paul Samuelson pioneered the mathematical models of maximisation that today form a central part of the economics of competitiveness. It is significant, then, that the pioneer himself deployed his method of difference equations to come to a conclusion that is wholly opposed to modern-day competitiveness mantra. This post brings Samuelson’s argument to a wider audience as it traces the intellectual underpinnings of contemporary competitiveness discourse. It reviews his defence of collective provision of the public goods that enhance individual welfare and his view that the funding of public goods should be protected from race-to-the-bottom dynamics.
David Ricardo’s status as the first really famous economist of the nineteenth century rests on two capacities: his ability to think in pure economic abstractions and his ability to harness economic theory to a liberal political worldview. They came together most famously in his theory of comparative advantage, through which countries are encouraged to specialise in producing the goods in which their workers are relatively most efficient. Despite being two hundred years old, Ricardo’s theory is still the mainstay of the orthodox economics justification of free trade and, at one stage removed, of modern-day competitiveness discourse too. This post looks behind the façade of the numbers that Ricardo used to illustrate his theory of comparative advantage, to show that they were anything but an innocent account of essential economic relationships. It therefore helps to place modern-day competitiveness discourse in a far from flattering intellectual light.
Fools' Gold Blog Post on Adam Smith's Critique of the British East India Company's Competitiveness Strategy
Adam Smith was an arch-critic of the regime-hopping strategies of the exclusive stockholding corporations, the forerunners of today’s multinational corporations. The British East India Company, having been granted a Royal Charter in 1600, was supposed to be acting on behalf of the sovereign to meet the country’s commercial objectives. The free hand given to the Company would presumably be couched, in modern parlance, as a ‘competitive’ strategy for Britain. Here, though, I show how rude Smith was about these corporations’ strategies in the latest in the Fools' Gold series exploring the intellectual history of the modern ways that people talk about the ‘competitiveness’ of national economies.
Re-posted on April 30th 2015 on the Tax Justice Network website.
Competitiveness discourse so clearly relates to the economy that it must have its roots in economic theory, wouldn’t you think? In the first of a series of pieces exploring the history of competitiveness thinking for the Fools' Gold Blog hosted by the Tax Justice Network, I suggest that things are much more complicated in this regard than they might at first appear. The origins of the modern competitiveness discourse are traced to Frank Knight's account of homo economicus which was designed specifically to fit developments in American neoclassical economics in the second quarter of the twentieth century. Nothing resembling competitiveness discourse had entered economics before then, and the structure of competitiveness discourse today continues to resemble what was created for that particular episode in the history of economic thought.
Even though 'Victorian values' have become bywords for reactionary social policy, the 1866 budget shows that today's Conservative Party fares badly by comparison. Watch out for what lies underneath Osborne and Cameron's claims that eliminating the deficit is a matter of inter-generational justice.
Business executives will continue to tell us how to cast our votes in May’s UK General Election. But, before being persuaded, check the evidence on both sides of the argument.
Re-posted on March 27th 2015 on the Tax Justice Network's Fools' Gold blog: http://foolsgold.international/stefano-pessina-and-the-two-sides-of-speaking-up-for-business/.
Politics Reconsidered Blog Post on the Self-Satirising Attitudes of Conservative Politicians towards Food Bank Use
Baroness Jenkin's recent claim that the use of food banks in Britain can be explained by poor people not knowing how to cook in an economising way almost exactly replicates the plot of a Guardian microplay in which a politician undertakes a 'Ready, Steady, Cook' challenge in an attempt to show that everyone is able to make ends meet if they are sufficiently resourceful.
Recent research from the UK suggests that such policies constitute hand-outs, rather than effective means to shape firms’ investment decisions.
Re-posted on March 12th 2015 on the Tax Justice Network's Fools' Gold blog: http://foolsgold.international/the-false-promise-of-corporation-tax-cuts/.
The recent appearance of food bank donation boxes in UK supermarkets raises a series of ethical questions about the commodification of convenience in the sphere of charitable giving.
In Fear of Flash Crashes: Stock Market Wobbles Past and Present
The new era of high-frequency trading threatens future prosperity.
Posted on 19.06.14 at http://speri.dept.shef.ac.uk/2014/06/19/fear-flash-crashes-stock-market-wobbles-present/.
John Redwood recently took the politics of expansionary austerity to new heights of unbelievability when strategically misunderstanding why the reduction in the UK's top rate of tax from 50% to 45% coincided in its first year with increased overall tax revenues.
Re-posted on April 17th 2015 on the Tax Justice Network's Fools' Gold blog: http://foolsgold.international/competitiveness-myths-and-expansionary-austerity/.
Those nice people at Amazon have created a virtual market that allows us to avoid all the pushing and shoving, all the claustrophobic crowds, all the ritualised elements of having to run with the retail mob. But what does it all mean for their employees?
The Nobel Prize and the Reproduction of Economics Orthodoxy
This year's economics laureates reflect the narrow purview of the prize and the entrenchment of familiar but limited ways of thinking about economic life.
Posted on 30.10.13 at http://speri.dept.shef.ac.uk/2013/10/30/nobel-prize-reproduction-economics-orthodoxy/.
Challenging the Economics Curriculum: The Quiet Revolution in Community Education
The advent of new community education programmes helping people to understand more about current economic matters is in direct contrast to the often esoteric qualities of the university economics curriculum.