Dynamic modelling sounds like something Cara Delivinge might do as she scatters hashtags across Instagram. But it is actually even more subversive and exciting than our Cara. If the advocates of this mathematical economic modelling technique get their way, then it could transform how public policy is assessed in Britain. In doing so, it could make arguing for tax cuts and a smaller state a lot easier.

Let’s look back to the Autumn Statement. In its response to the chancellor’s annual announcements, The Taxpayers’ Alliance highlighted three areas where it says there are “weaknesses in tax policy”. Predictably, one weakness is that taxes are too high. Another is that there are too many of them. But the third recommendation is more esoteric. The pressure group said that “dynamic modelling” should be used for “all fiscal policy changes announced by the government”.

What is so important about this?

One clue comes in the form of a paper released on Monday by the Treasury and HM Revenue & Customs into the coalition’s policies on fuel duty, the tax on refined petrol, diesel and other fuels.  Read more

I studied for an undergraduate degree in England and for a masters in the US. In America, I learnt of the debt some of my fellow students had taken on. The English system I had studied under from 2003 to 2006, and which ended in 2012, seemed relatively generous. But after reading Thursday’s report by the Institute of Fiscal Studies into what the new system of student funding means for future graduates from English universities, I suspect that the idea that the average American graduate is more indebted may soon no longer hold. Graduates of English universities could shortly become the most indebted in the world. Read more

The Uses of Literacy (1957) by Richard Hoggart, who died on Thursday, was a book that shaped how many Britons see their culture and politics. Published the same year as Michael Young’s Family and Kinship in East London (1957), it showed the rhythm and cadence of lives in industrial communities, which had been muffled by the haughtiness of Britain after the second world war. As the historian David Kynaston tells us in Modernity Britain (2013), Alan Bennett said The Uses: “made me feel that my life, dull though it was, might be made the stuff of literature”.

Not everyone felt that way. Kynaston also quotes from Kingsley Amis’s typically lordly and disdainful review of The Uses: “It would be pleasant to say of the book written out of such obvious earnestness and decency of feeling that it represented an achievement, but it is only an attempt.” You can see where Martin gets it from. Read more

Iain Mansfield has won the “Brexit” prize, a competition run by the Institute of Economic Affairs think-tank to find the best way for how Britain could leave the EU. The diplomat has also written a fantasy novel called Imperial Visions. I would love to say that Mansfield confused his non-fiction and fiction but that would be harsh; his essay is thoughtful and more reasoned than the headlines greeting it suggest.

But ultimately, I think Mansfield is slightly too generous to his own analytic case in some places. But it is not as if he says that Brexit would bring a more prosperous future. Rather, he thinks it’s a wash. After reading this essay – one meant to outline the best course for UK withdrawal from the EU – I am left more convinced, rather than less, that the burden of proof remains with those proposing Brexit.

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Statistics released on Wednesday by the Higher Education Funding Council for England show that the number of overseas students studying at English universities has declined for the first time in 30 years. The data should raise concerns about the openness of the UK to the rest of the world. It is hard to win a “global race” if fewer people want to start on your track.

The chart below shows the number of overseas full-time undergraduate students entering an English university each year since 2005-6. Students from the rest of the EU are represented by the red bars and non-EU (“international”) students by the blue bars. The figures between the bars show annual percentage growth. Read more

Mr Osborne, like Mark Carney before him, seems to have had no impact on voting intention. The ten opinion polls conducted since the chancellor’s speech in Edinburgh on February 13 show that “the currency intervention has not had a fundamental impact on the referendum race”, according to John Curtice, Scotland’s top psephologist. An average of those polls show the Yes vote on 43 per cent (excluding the all-important don’t knows), a two percentage point increase on the average between the start of the year and the speech. When asked by TNS BMRB, a polling company, to rank issues in order of importance to their independence voter, Scots placed currency eighth.

The good news for Better Together is that currency does not seem to matter much for Scots ahead of the vote on September 18. And yet the bad news for Better Together is that monetary union does not seem to be a decisive issue.

Let me try to explain this apparent contradiction. Read more

Every week or so, in my previous job as comment editor, I would chat to Sir Samuel Brittan about his column. “Sam”, as he prefers, would have two or six suggestions and he was too polite to let on whether the conversation was mere courtesy. Despite his uncanny ability to arrive at my desk five minutes before deadline, it was invariably one of my favourite moments; the FT can be a special place to work.

I would occasionally suggest to Sam that he write about, say, the latest development in the eurozone crisis or the most recent announcement by the UK government. He would give the uncanny impression of someone contemplating what I had said. But soon enough, I had been enlightened as to the irrelevance of the emphemeral. More than once, Sam explained as follows: “I’m more interested in ideas.” Read more

At the Budget last week, George Osborne said that “under this government income inequality is at its lowest level for 28 years”. Talk about chutzpah. Not only is this fact reflective of the financial crisis and the response of the social security system it is also marginal in a historical sense.

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On Tuesday, official data showed that UK inflation, as measured by the Consumer Price Index, rose by 1.7 per cent in the year to February, a slower pace than the 1.9 per cent reported last month. Employee earnings adjusted for CPI fell at their slowest pace since April 2010. If “real wages” were to rise this year, the government hopes this fact would protect it from attacks by the opposition Labour party about the cost of living. The gap between inflation and earnings is more than simply a technical matter.

However, that makes the technicalities more important to understand. The analytical debate about “real wages” tends to focus on measures of wages. But how inflation is measured obviously matters, too. This chart from the Resolution Foundation shows two forecasts for real weekly median earnings – one using CPI and the other using RPI-J, a supplementary measure that includes housing costs and has a controversial history.

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In the capital, about half of households rent. The other half own.

At present, the official of national statistics’ monthly house price data are a cause of mixed emotions; there needs to be a psychological term for renters’ remorse.

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