Two Hundred Years of Muddling Through: The surprising story of Britain's economy from boom to bust and back again

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However, it is argued that political power is a more important factor than the economic theories in deciding which economic policies are implemented by government. Consequently, political power, brought about by both a changing society and evolving political forces over the 200 years are identified by the author. How these political factors determined the economic strategy to be implemented by various governments are also explained in the book. A few themes organise the book: path dependency, political economy, and the importance of productivity. Path dependency meant having to deal with crises that were inherited, which had often been subject to short term fixes. Political economy has to do with who had power, which was strongly influenced by who could vote. And average product per (employed) person varied widely, rising fast around 1800 but falling throughout the past century. It’s fair to say that Weldon succeeds in answering it with his pacy, vivid canter through the Industrial Revolution, two World Wars, post-war decline and resurgence in the 1980s, right up to the current crisis. It's fair to say that Weldon succeeds in answering it with his pacy, vivid canter through the Industrial Revolution, two World Wars, post-war decline and resurgence in the 1980s, right up to the current crisis. Then came Brexit. This damaged economic confidence, sterling fell and the well-documented problems ensued. The global pandemic followed leading to falling economic growth and structural shifts in the heavily indebted economy.

TWO HUNDRED YEARS OF MUDDLING THROUGH: THE SURPRISING STORY

While the book mostly feels like an engagingly-written history of one economic event after another, Weldon emphasises a few recurring themes one can take away from economic history. Some of these do definitely stand out in his history, like the importance of political and social context, and how constant economic debate has been over the years. Weldon also emphasises 'path dependency', which he says 'is perhaps best thought of as the idea that the route one took to arrive somewhere is just as important as the destination'. I had more trouble understanding what this means, and how his history bears this out. How could history be anything other than path-dependent? What would a non-path-dependent economy look like, even hypothetically? Geography still dictates trade. During the high years of British imperialism, (1870) only 25% of exports went to the empire, and by 1900 only to 30%. Europe remained the UK’s most important export market. The book shows how the Industrial Revolution essentially set the UK off on a path which has taken other countries in Europe the best part of c150 years to catch up with and how, more recently, the UK has struggled to work out what economic a coherent economic approach looks like (the Brexit debate is highlighted as typical of this incoherent approach). Centuries of a largely agrarian economy vanished with the Industrial Revolution. Productivity and standards of living rose. The population and production moved from homes in the country to crowded towns. Increased coal production was needed to power mills. Canal traffic rose and railways boomed.A terrific achievement, covering clearly but with subtlety everything from the spinning jenny to Covid-19' The book is also great for reminding oneself of the similarities between present and past and of the need to avoid past mistakes. An in-depth historical analysis of British economic policies. As someone who is totally new to the subject, this felt far too detailed and a lot of it went over my head. My eyes glazed over throughout many chunks of this book. However, for such a detailed book, the author mentioned the British Empire maybe twice, and given what a massive impact the Empire had on the British economy, I expected at least a chapter, or even half a chapter dedicated to it. I felt like large chunks of history (1990s to today) were also rushed.

From boom to bust and back again • Resolution Foundation From boom to bust and back again • Resolution Foundation

If you do nothing, you will be auto-enrolled in our premium digital monthly subscription plan and retain complete access for 65 € per month. I enjoyed this - it’s exactly the sort of readable, concise narrative (interspersed with enough statistics to help assure you it’s rigorous and some good anecdotes) that you’d expect from a BBC and Economist journalist. The book has a few themes throughout the narrative - the importance of path dependence, the benefits of specialisation at various points (like the decline of agriculture during the World Wars that allowed Britain to focus on manufacturing and financial support for the Allies) or the impact of political decisions on economic reality (like the allocation of costs in things like the Corn Laws, the influence of the growth of home ownership on interest rate decisions etc). All of these points should be more present in the public debate, not just in Britain. It uses modern measures of the size of the economy, specifically Gross National Product, only developed since 1950, to provide a basis not for improvement (average income per person) but also levels of spending (% on education, defence etc) as well as national debt. This provides a framework to identify and discuss changes that might not have otherwise been clear. Even to those having to deal with them. The ideas of influential economists such as Smith, Keynes and Friedman are highlighted. The influence of these ideas on government policy and thinking is also discussed.This is an accessible overview of the last two hundred years of British economic policy-making. I have been looking for a book like this for some years and I was really pleased when I saw that Duncan Weldon was working on such a topic, as his laconic style goes some way towards making this often confusing narrative coherent.

Years of Muddling Through: The surprising story Two Hundred Years of Muddling Through: The surprising story

One of the traditions in the bounded rationality line of thinking is incrementalism – otherwise known as ‘muddling through’. It was conceived by Charles Lindblom in two key articles (Lindblom Public Adm Rev 19: 79–88, 1959; Public Adm Rev 39: 517–526, 1979), and it has influenced the management literature in several ways. Keywords The author uses simple numeric examples to explain economic concepts and this is extremely helpful to the non economist or those such as myself who studied economics a long time ago!The Malthus theory states that the world is governed by a brutal logic; human wants are infinite but human means were finite. Put simply, to limit starvation and masses of poor people, the best way to restrict population growth. Feeding the poor would only result in more poorer people. In some way it links in with your theory about housing and governments liking to restrict the population growth and therefore in the short run/their premiership taxation costs. Rapid population decline is not what governments want, as like Spain in the 1930, there are not enough people to harvest the corn. March, J.G. 1978. Bounded rationality, ambiguity, and the engineering of choice. Bell Journal of Economics 9: 587–608.

Two Hundred Years of Muddling Through - Hachette UK Two Hundred Years of Muddling Through - Hachette UK

Economic rent has always been a factor in developed economies. Economic rents are a way of enriching oneself without producing anything extra, such as renting out a property, the rent of which is a product of demand and supply more than producing economic value. Open societies do not rely on economic rents for growth. Britain during the late 1600s- mid 1700s had an open internal market within the UK where goods could be sold across the country. Spain and France did not, which enabled landowners to make a lot of money, but not actually contribute to economic growth. Britain was therefore able to win the wars with countries by having a more tax producing economy. Again, the parallels to today jump out. movement of people within the UK is being hampered by high rents/social liquidity, keeping poor people and poor areas poor. Post revolution Britain was much better than the pre-version, where land/rents took nearly 24% of national income, compared to 11% after. The UK is, at the same time, both one of the world's most successful economies and one of Europe's laggards. The country contains some of Western Europe's richest areas such as the south east of England, but also some of its poorest such as the north east or Wales. Looking into the past helps understand why. A central theme to the book is how the role and shape of the state has changed and adapted over time - not often for purely ‘ideological’ reasons, but more in response to economic developments and challenges, as well as the need to cope with huge global events (WW1 and WW2 loom large).

Globalisation ebbs and flows. The world of 1914 was much more globalised in relative terms that the world economy of 1979. Britain was the premier financial centre of the world in the late Victorian world, declined during the war years (1914 – 1970), and them boomed again between 1980 and the 2008. The author points to vested interests being a powerful force in hampering economic progress. For example, politicians tried to manufacture pre-election booms which led to stop -go episodes. Union power prevented economic progress. Later the trade unions were reformed by Thatcher and this eventually led to an economic revival. With the rise of the entrepreneur, the landed gentry became less influential. Despite productivity increases the working class benefited little. The great reform act of 1832 changed the structure of the House of Commons and ended the dominance of the aristocracy.