Quantitative easing: why it doesn't work

Laying the foundations for recovery

In the second year of my economics degree we were mixed in with some first years for some lectures. In the first week one of the freshers asked “Why don’t we just print more money, give it to people, and make them richer?”

We second years laughed, but that economic ingénue might be having the last laugh. As the Bank of England prepares to print another £75 billion of new money, she seems to have a seat on the Monetary Policy Committee.

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The hills are alive with the sound of praxeology

When I told a friend of mine three years ago that I was interested in Austrian economics she asked “Isn’t that just selling cuckoo clocks and lederhosen?” True, she wasn’t the brightest, but Austrian economics was fringe stuff. An influential school originating in Vienna in the late nineteenth and early twentieth century it was largely buried under the Keynesian avalanche of the 1930’s. That’s changing.

The Austrian school survived in America where émigré economists escaping the turmoil of 1930s Europe inspired a new generation. Perennial presidential candidate Ron Paul is an advocate of Austrian economics and the Ludwig von Mises Institute dominates the field.

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