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Jo Michell Profile picture
Jo Michell
@JoMicheII
Economics prof @UWEBristol. @PKEconSoc chair. @FMM_macro fellow. @PEF_online council. Blogging intermittently at https://t.co/gjD32qdelI
Jul 7 • 12 tweets • 3 min read
I’m bored of the vote share discussion and it’s clearly time to move on. A few points before we do though. 1/n Labour won a huge majority as the result of a very professional and disciplined campaign which targeted marginal seats. They played the game within the rules and constraints of the current system and they won, big time. Image
Jul 21, 2023 • 19 tweets • 5 min read
In light of Watson's comments yesterday, let me share something I've been working on.



When I started thinking about the relationship between growth, technology and emissions, I quickly came across the widely used Kaya identity. 1/bbc.co.uk/news/science-e… This decomposes emissions into a number of key indicators and ratios: population, GDP per capita, energy per unit of GDP and emissions per unit of energy. Image
Jul 5, 2023 • 26 tweets • 6 min read
I'm going to respectfully disagree with Tony here and provide an alternative answer to @hugorifkind , drawing on a draft of a new paper with with Rob Jump, @meadwaj and @FrankMacroecon on a coordinated monetary-fiscal response to supply shocks. 1/n

https://t.co/bjXikyj4jWresearchgate.net/publication/37…
We revive an argument from Gordon that reductions in sales taxes can reduce inflation; this will of course stimulate aggregate demand and require offsetting tax increases elsewhere.

This is one example of many possible policies in response to inflation. https://t.co/erudXU7bBKcore.ac.uk/download/pdf/6…
May 15, 2023 • 9 tweets • 3 min read
A useful intervention from Marc on current, rather messy, inflation debates.

Marc argues that the relationship between prices and profits is mechanically driven by commodity price movements and the proportion of overhead costs in to total output.

medium.com/@monetarypolic… These are plausible mechanisms.

It's also plausible that there is a straightforward mechanism from supply shock to price increases to measured profit margins for firms in the primary sector, e.g energy producers/refiners.
Apr 17, 2023 • 37 tweets • 4 min read
Hello from Bristol Uni where some I and some intrepid students have come to check out the “Free Market Road Show”. Image It’s a stellar line up for the first panel. Image
Mar 3, 2023 • 17 tweets • 7 min read
A new @PEF_online report with Rob Jump, @meadwaj and Natassia Nascimento. With austerity retoric returning on both sides of the political divide, it's time to revisit macroeconomics of austerity.
What was the justification, and what were the results? 1/n
progressiveeconomyforum.com/publications/t… The social consequences are now well understood -- but austerity was originally and explicitly sold to the public as a strategy for rebuilding the British economy.

In 2010, Osborne laid out a series of 'Benchmarks for Britain'. Table listing Osborne's 'benchmarks for Britain', taken from
Nov 13, 2022 • 10 tweets • 4 min read
Sorry to say but this article is not very good. theguardian.com/politics/2022/… The budget did not “cost the country” 30bn. Image
Nov 10, 2022 • 23 tweets • 8 min read
New report out today with @PEF_online which highlights the problems of reporting of so-called 'black holes' in the public finances. 1/n

progressiveeconomyforum.com/publications/t… We argue that while 'holes' are presented as concrete facts which require urgent action, they actually just the difference between arbitrary targets and uncertain forecasts. This is not explained in media coverage which uses dubious metaphors instead of explaining issues. Image
Oct 14, 2022 • 15 tweets • 3 min read
So, we seem to be nearing the climax of S01E01 of Trussonomics. Feels like the last few weeks are starting to settle into perspective. The brilliant plot twist of Bailey bellowing "three days left" into a swirling financial vortex has been followed by ... relative market calm. It looks like Bailey played two games of chicken this week -- and won them both, at least in the short term. Game 1 was against the pension funds.
Sep 4, 2022 • 7 tweets • 1 min read
People on lower incomes spend a greater proportion of their income on consumption than those on higher incomes.

Redistribution of income from poor to rich will, all else equal, reduce consumption/GDP. Consumption is by far the largest component of total expenditure.

If GDP is largely demand-driving, falls in (growth of) total consumption will lead to lower (growth of) GDP. Image
Sep 3, 2022 • 5 tweets • 2 min read
Top tip for those living with sash windows. They work more effectively if you don’t fill the weights boxes with expanding foam. I shall plug these gaps, thus making my house more waterproof and better insulated!

Oh, why can’t I open the windows?
May 27, 2022 • 13 tweets • 3 min read
Interesting paper from Josh and his co-authors. The institutional analysis is useful, but I disagree with the "the government does have a magic money tree" conclusions. 1/n There are two related issues:

1) can a government theoretically print money to cover its expenditure? and 2) can the UK government do so under current institutional arrangements?

MMT-influenced discussion often fails to keep these questions separate.
Jan 4, 2021 • 5 tweets • 1 min read
Nice and clear -- and completely wrong -- from Mankiw. boeckler.de/pdf/p_imk_wp_1… Note the use of the 'then' when discussing banks. A clear and incorrect statement of temporal ordering.
Jan 4, 2021 • 5 tweets • 2 min read
👀 Five years ago saying this kind of thing inevitably meant being denounced as a crank. theguardian.com/politics/2015/…
Jan 4, 2021 • 4 tweets • 2 min read
Does anyone know the origin of the loanable funds diagram? The one with S and I curves and the rate of interest on the y axis. Who drew it first?
Any ideas @Undercoverhist? Is this the first appearance, in Mr Keynes and the Classics? (ht @steffie_pf)
Dec 29, 2020 • 11 tweets • 4 min read
Right, let’s do this.

Joan Robinson on investment and saving in 10 tweets or less. 1/ By investment is meant an addition to real capital ... This use of the word does not correspond to the everyday sense in which investment means merely acquiring a title to capital. ... Saving is the difference between income and expenditure on consumption. 2/
Dec 27, 2020 • 8 tweets • 3 min read
Wow, Noah blocked me for pointing out the mistakes in his post! Its time for another ECONOMICS EXPLAINER!

criticalfinance.org/2020/12/27/loa…
Jul 14, 2020 • 8 tweets • 4 min read
What .. is this? Gilt rates at 4.1%. Righto. I guess it's possible that gilt rate could also be a different number over a 50 year time horizon. But no confidence bands, yes, fine fine.
May 19, 2020 • 58 tweets • 13 min read
Question to all panelists: Does MMT advocate for monetary finance?

Answer on both sides of the paper and make sure you cite all relevant literature. First interesting point: Kocherlakota seems to be arguing that mainstream econ believes in Say's Law over ~= a 3-year period. Demand can't affect supply. No hysteresis. No Kaldor-Verdoorn.
May 16, 2020 • 6 tweets • 2 min read
Even putting aside the ignorance and/or error about an average school size of 100, there is a serious problem here. 1/ Harries says that coronavirus prevalence is currently "two or three in a thousand" and that this is "likely to halve" by the time schools open. So lets say the infection rate is one in a thousand when schools open. 2/
Mar 25, 2020 • 11 tweets • 4 min read
Our letter in the FT, written and coordinated with @BBonizzi, @DanielaGabor, @anninak82 and @Powell_J_R, calling for immediate concerted action to help emerging and developing economies cope with the threat of COVID-19. 1/

ft.com/content/350538… A longer open access version with the full list of signatories is here 2/
criticalfinance.org/2020/03/24/dev…