Review: Why Nations Fail: The Origins of Power, Prosperity, and Poverty

Written by | Tuesday 10 July 2012

What makes countries end up in persistent and permanent poverty? Why is Mexico much poorer than the United States? Why is Latin America so fundamentally different to North America? How is it possible that an average American is 40 times richer than an average Sierra Leonean? Is it climate, geography, culture, or could it be the ignorance of domestic leaders? Acemoglu and Robinson suggest it’s none of these – rather, the real reason behind the poverty trap and significant between-nation differences lies in the role of political and economic institutions.

Taxing Times: Tax Avoidance, Boon or Bane?

Written by | Thursday 28 June 2012

The recent Times series on tax avoidance has triggered a huge spike in coverage of the tax affairs of the rich and famous. 

David Cameron’s condemnation of Jimmy Carr’s tax arrangement as ‘morally wrong’, presumably based on newspaper headlines, was arguably unwise, and may well come back to haunt him as open season is declared by the press on Tory donors tax planning arrangements.

Rather ironically, in the same week he welcomed the news of the introduction of a 75% tax for high earners in France;

In praise of consumerism

Written by | Friday 22 June 2012

We generally hear the term ‘Consumerism’ used as a term of abuse, usually by religious movements, pro-state economists, environmentalists and so on. I would argue that, properly constituted, a ‘consumerist’ society is exactly the type of society that we should be striving for.

However, part of the pejorative use of the term comes from a particular meaning attached to it. As the brief but surprisingly illuminating Wikipedia article observes, there are at least four possible meanings of the term:

Mind Your Own Business!

Written by | Wednesday 20 June 2012

We need a real market for corporate control, argues Elaine Sternberg. Private firms may have good reason to pay their executives highly, and shareholder sovereignty should be protected. The most important thing the government can do is to remove state restictions on shareholder power — and stop meddling in how private companies are run. 

Shiny happy people? The madness of the Happy Planet Index

Written by | Wednesday 20 June 2012

The New Economics Foundation’s Happy Planet Index has been inspiring bemusement and mirth since it first appeared in 2006. The third installment, released last week, continues to defy parody with its glorification of lawless, poverty-stricken countries in the name of environmental sustainability.

The case for single-issue activism

Written by | Thursday 31 May 2012

Classical liberals, libertarians or indeed anyone arguing for a smaller state (I’m going to use ‘Liberals’ as shorthand) have a serious problem. We don’t seem to be very successful at converting the corpus of intellectual work and powerful arguments against interventionism into concrete political success. Whilst the Archbishop of Canterbury, Polly Toynbee or Michael Sandel, to name a few, seem to think we are living in an era of unbridled free markets, any sensible observer can see that this is not the case; state capitalism or corporatism is the status quo.

Review: Keynes Hayek, The clash that defined modern economics

Written by | Tuesday 3 April 2012

The confrontation between John Maynard Keynes, and his Austrian born free market adversary and friend, Friedrich August von Hayek, is one of the most famous in the history of contemporary economic thought.  The debate took place during the Great Depression of the 1930s about the causes and remedies of business cycle downturns in market economies.

A critique of the GAAR Report

Written by | Thursday 15 March 2012

Introduction

For many years, the boundary between acceptable and unacceptable plans to reduce a UK tax bill has been depicted by tax “avoidance” versus tax “evasion”, the former being acceptable and the latter not.

The global economics of corporate tax cuts

Written by | Wednesday 29 February 2012

Jim Flaherty, Canada’s minister of finance, may well be exasperated.  Speaking of the federal government’s plan for a national corporate tax of 25 per cent, the Minister affirmed that ‘we believe lower taxes create investment and jobs.  I continue to encourage our provincial partners to follow our lead.’  Unfortunately, his counterparts remain to be convinced, with British Columbia and Ontario signalling their intentions to halt the downward tre

The triumph of global capitalism

Written by | Friday 17 February 2012

When she was young, Maria Vargas moved from the countryside in northern Brazil to Sacadura Cabral, a poor suburb (favela) of São Paolo. (Melo, 2002) She worked as a maid and in the textiles industry, but was injured and had to provide for herself and her seven children – one of whom died as a four-year-old – by sewing after the death of her husband.  Maria is only one of the many faces of poverty.