The quantity of money

After considering what is money and how it is created, the next step is to look at how much there is, how the quantity changes over time, and what this is telling us. We are in luck because we can look at real data.* Below I plot the amount of money in circulation in the UK… Read more

A brief history of money

The following is an extract from the unpublished book: Peoplons, Charmons and the Strange One: the uncertain science of economics by C. S. Adams, Illustrated by Cohenbaum. Tokens of exchange: In the economist’s book of myths and legends, money was invented to solve the “double coincidence-of-wants” problem in a pair-wise economic exchange. Paul the baker wants a… Read more

Lower tax equals a worse life

Let’s be clear, lower tax means lower prosperity, worse public services, worse health and worse education. The evidence is in the data. The graph below (updated 2017-06-08 following suggestions in the comments) shows outcome measured using the UN’s inequality-adjusted human development index (IHDI) as a function of input measured using tax as a percentage of national… Read more

Graph of the day

The Institute of Fiscal Studies has helpfully done an analysis of the manifesto proposals of the main parties (see here). The graph below is their analysis of how current Conservative plans will influence the income of people in different parts of the income distribution. It shows, the richest 10% just about managing, while the poorest… Read more

Follow the money

There is one simple rule that most economists agree on: prosperity = productivity The Chancellor understands this – productivity was mentioned 10 times in his recent Spring Budget speech. He said: Simply put, higher productivity means higher pay. and went on to say that Britain’s problem is a productivity problem We are 35% behind Germany and… Read more