Royal Economic Society Issue no. 176 Newsletter January 2017 Another New Year By the time this Newsletter is distributed, every one Correspondence (and his or her dog) will have given us the benefit Letter from France p.3 of predictions for 2017, so we will spare readers the demonstration of our incompetence in this area. Inevitably, however, there must be some reflection on what has happened in the last year and on what Features a very uncertain future might hold. 2016 was a good year for shocks, especially for those with an interest Economic Journal — Editors’ Annual Report p.5 in Western economies. The overwhelming consen- Econometrics Journal — Editor’s Annual Report p.9 sus amongst economists, as we reported several times, was that leaving the EU was likely to have a J M Keynes in King's College and the General Theory negative impact on the UK economy (and possibly of Employment, Interest and Money p.13 on the EU as well). This did not, however, include a prediction that the roof would fall in within six Money, Macro, Finance research group months, though one might be forgiven for thinking — Annual Conference report p.16 that it did given the volume of ‘leave’ voices claim- Three prizewinners in economics p.19 ing that ‘the experts all got it wrong’. In our previ- ous Newsletter we noted the complaint that the RES had made to the BBC about the misleading nature of its coverage of the economic debate. Sadly, the complaint appears so far to have fallen on deaf ears Obituaries and the Society is considering what to do next. But the concern about the degree of misreporting Michael A Crew p.20 extends beyond the RES and readers may be inter- Donald MacKay p.20 ested in the one day conference, involving also HM Treasury and the Bank of England, on the relation- ship between the economics profession and the gen- eral public to be held in May (see p.15). RES News p.23 Furthermore in this year’s ‘Letter from France’, Alan Kirman makes some interesting observations on the role of so-called social media in the promul- gation of falsehoods. Conference diary p.24 In these rather depressing circumstances, the best we can do is join with Alan in wishing readers a (somewhat belated) ‘Bonne Année’. Royal Economic Society Economic Royal THE ROYAL ECONOMIC SOCIETY • President: Professor Andrew Chesher (UCL and cemmap) • President-elect: Professor Peter Neary (Oxford) • Past-president: Professor John Moore (Edinburgh) • Secretary-General: Professor Denise Osborn (University of Manchester) • Second Secretary: Professor Robin Naylor (University of Warwick) For other members of the Executive Committee, go to the Society pages on the website where all those involved in the structure and governance of the Society are listed. The Society’s The Royal Economic Society is one of the oldest and most prestigious econom- Newsletter ic associations in the world. It is a learned society, founded in 1890 with the aim ‘to promote the study of economic science.’ Initially called the British Economic Association, it became the Royal Economic Society on receiv- The Newsletter is first and fore- ing its Royal Charter in 1902. The current officers of the Executive most a vehicle for the dissemina- Committee are listed above. tion of news and comment of inter- The Society’s bee logo est to its readers. Contributions from The Society’s logo, shown below, has been used from its earli- readers are always warmly welcomed. est days. The story behind the use of the bee refers to the We are particularly interested to receive ‘Fable of the Bees’ by Bernard Mandeville, an 18th Century letters, reports of conferences and meet- essayist which alludes to the benefits of decentralisation ings, and news of major research projects as by looking at co-operation amongst bees and showing well as comment on recent events. how the pursuit of self-interest can be beneficial to society. The Latin quote comes from Virgil and speaks of the drive of bees. Visit our website at: www.res.org.uk/view/resNewsletter.html The Newsletter is published quarterly in January, April, July and October Newsletter - subscription rates The Newsletter is distributed to members of the Society free of charge. Non-members may obtain copies at the following subscrip- For membership benefits, sub- tion rates: scription fees and how to join the Society, see back • UK £5.00 • Europe (outside UK) £6.50 • Non-Europe (by airmail) £8.00 cover or go to: www.res.org.uk Next issue No. 177 April 2017 Deadline for submissions 16 March 2016 Editor Administration Officer Prof Peter Howells, Mrs Amanda Wilman, Bristol Business School, Royal Economic Society, UWE Bristol, Office of the Secretary-General, Coldharbour Lane, Bristol BS16 1QY The Bute Building, Westburn Lane, University of St. Andrews, Email: [email protected] St. Andrews, Fife, KY16 9AL [email protected] Fax: +44 (0)1334 462479 Email: [email protected] Designed by Sarum Editorial Services: www.sarum-editorial.co.uk www.res.org.uk/view/resNewsletter.html 2 Correspondence Letter from France — Le Déluge! Alan Kirman looks at the role of easy access to information in shaping radical political changes in the US and Europe. T WOULD BE DIFFICULT to imagine a worse year than was minister of education he reduced the number of teach- 2016. France decided to impose a state of emergency ers by 80,000. His conviction which is erroneous in my Iafter the terrorist attacks at the end of 2015 and, since view, is that by moving to the right he can pick up some then, the train stations and other public places have seen of those who might otherwise vote for Marine Le Pen. the appearance of quite heavily armed soldiers. Fear is a powerful motivator, and given the lack of popular appre- The hole left by Hollande on the left has a number of ciation of Hollande’s policies it has been widely suggest- candidates poised to fill it and in particular Manuel Valls ed that the maintenance of the state of emergency was a who has just resigned as prime minister. He too, thinks way of distracting attention from the country’s other that popular opinion in France has moved to the right domestic problems. The famous inversion of the unem- and taken a tougher stance on immigration and on secu- ployment curve on which Hollande staked his political rity than Hollande. How he will justify this stance to future, has only recently shown timid signs of appearing those who identify themselves with the left remains to be and Hollande finally threw in the sponge having fallen to seen. To make sure that the left do not abandon him in 4 per cent in the approval ratings, the presidential election he has now and decided not to run for a second An old idea was that the easy access to so taken positions on economic mat- term as president. His young ex- many“ sources of information would lead to a har- ters which he hopes will appeal to minister for the economy monization of opinion with the centre and what he sees as that part of the Emmanuel Macron had already extremes well defined. In fact, recent work has political spectrum. The only prob- quit the government at the end of suggested that just the opposite may happen. lem with this is that when he partic- the summer and has set up a new ” ipated in the previous primaries he party, which for want of a better term, could be described took economic positions diametrically opposed to those as Blairite. All the emphasis is on efficiency and compet- he now claims to hold. At that time he wanted to abolish itiveness, which, in a country, which has already suffered the 35 hour week and slim down the public sector. from the austerity hawks may not go down well. Macron However, maybe amnesia is as powerful as myopia in made a trip to New York recently, to meet Joe Stiglitz, the public. ostensibly to discuss how to combat tax havens, but given the contrast between Macron’s 20th century eco- Brexit and Trump: could it happen here? nomics and some of the Stiglitz macroeconomic propos- But if France seems to be in a bit of a political mess, let’s als one can only hope that he may have been given food just consider the cases of the UK, the US and Italy. The for thought. vote for Brexit was received with disbelief and some relief here. The Far Right were jubilant and others were The French Presidency delighted to see just how badly a country could prepare Now that the presidential election has been thrown open, itself for such a happening. Posing a more or less mean- the candidates from the ‘right’ (and I will come back to ingless question to a population which was ill informed the question as to whether such a term is meaningful), and then deciding on the future of that country on a sim- may be asking themselves whether they would not have ple majority vote smacked of genuine incompetence. preferred to have Francois Hollande as their opponent. Worse, none of the Brexit supporters had any sort of plan After a courteous but vicious primary campaign, for what to do in case of victory and the British version Sarkozy the former president was eliminated and some- of Trump, Boris Johnson, was rapidly thrown overboard what surprisingly, Francois Fillon, his ex-prime minister by the Tories, to join Farage, ‘mission accomplished’ in became the official candidate for the ‘Republicains’.