In his latest series of blogs, the Adam Smith Institute’s President, Dr Madsen Pirie took aim at 50 of the most prevalent and pernicious falsehoods about economics. Read them all here in this collection of all 50 pieces.
Prof. Scott Sumner, who inspired the US programme of QE3 and was dubbed ‘the blogger who saved the US economy’ by The Atlantic, explains how central banks—not bankers—caused the 2007-8 crash. He goes on further, showing how the European Central Bank is repeating the mistakes the Fed and the Bank of England made in the dark days. And he argues that they can solve the slump and prevent future crises with a market-based, rule-based, stability-focused monetary policy of targeting the level of nominal GDP.
An independent Scotland using the pound outside of a currency union would have a more stable financial system and economy than it has now or than a currency union could provide, argues Sam Bowman. ‘Adaptive sterlingization’ – a combined policy of unilateral use of GBP without a formal currency union and reform of Scottish banking regulations – would reduce risk-taking and increase competition in banking, significantly reducing the prospect of large-scale bank panics and financial crises. The ‘dollarized’ economies of Latin America – Panama, Ecuador and El Salvador – provide strong modern-day evidence that banking systems do better without central lenders of last resort.
The great economist Ronald Coase has died at the age of 103. Vuk Vukovic explains what made Coase such an influential and profound thinker.
Dr Madsen Pirie’s speech in opposition to the motion: “Karl Marx was right. Capitalism post-2008 is falling apart under its own contradictions.”