Zombies & Creative Destruction

Low interest rates have allowed companies to survive which would otherwise have become bankrupt. This truth has fathered a popular fallacy* which claims that it has a damaging impact on productivity, because these weak survivors, termed zombies, do not invest and as...

A Schumpeterian view of zombie companies

Financial Times – Letters, 29th June 2020 Sir, Your leader (“Reasons to fear the march of the zombie companies”, FT View, June 25) confuses companies with their businesses. You rightly argue that companies, which can cover their variable costs, should not be...

The Economics of Covid-19

Economics is not good at forecasting but better at cures. We need to switch from the former, which dominates the news, and concentrate on solving our major problem. Before the pandemic this was stagnation, we now face the prospect of a long-term decline in our...

Investment, Productivity, and the Bonus Culture

American Affairs Journal, Summer 2020 / Volume IV, Number 2, 21st May 2020 Weak growth is far and away the most important economic problem facing the United States. This problem is not simply the result of the financial crisis or the severe recession that followed;...