I’m not a macroeconomist myself and so when I meet proper macro folk, I try to draw them on the topic of the day: how to stimulate the British economy. Should George Osborne reverse his tax rises and postpone his promised spending cuts? Or would any stimulus that resulted be lost in the turbulence of lost credibility and higher borrowing costs? With a ￡1.5tn economy, any stimulus spending that was big enough to make a difference should hardly be taken lightly. Hence my interrogation of any macroeconomist I could find.
To my surprise, on a couple of recent forays into this territory, I have found my inquiry sidestepped completely. The real issue, I am told, is microeconomic: the government needs to find a way to get more houses built.
This could certainly work in principle: there is a robust demand for houses at well above the cost of building them, and house building would be a good source of employment for semi-skilled or unskilled young people, a group badly affected by this recession and one that has not been in good shape for some years.