The global economy requires radical institutional reform to prevent permanent falls into low growth and weak productivity, a Bank of England rate-setter has said.
Jonathan Haskel, an external member of the Bank’s nine-strong monetary policy committee, said economic institutions had become fundamentally “outdated” to cope with rapid changes in the “intangible economy”.
“Our disappointments around economic growth are not because we’ve just run out of ideas like neo-liberalism or socialism, but it is because the economy has changed,” Haskel said. “Trends towards intangible assets like software need new institutions. This includes competition policy, cities policy and regulation. If we don’t change, then the intangible economy is going to stall, which will become the source of our difficulties.”
Haskel, professor of economics at Imperial College
