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The term “helicopter money” is derived from a vivid image created by the US economist Milton Friedman in which a central banker showers notes on a grateful populace. More recently, the notion has been promoted by Adair Turner, the former chairman of the UK financial regulator, in his book, Between Debt and the Devil .
It is characteristic of science to give precise meaning to concepts and the basis of their measurement. Economics is genuinely harder. Yet it is all too easy to write a mathematical symbol without giving thought to what observable fact in the real world corresponds to that symbol.
Since 2008, UK employment has risen substantially and working hours have increased but output has barely grown. To explain this productivity puzzle we must dig into the detail of how aggregate statistics are built up.
Following the global financial crisis there has been much discussion of curriculum reform in university economics teaching. More pluralism is required, but there is no need for "two communities within the same discipline".
Price indices are compiled by measuring the changes in the cost of buying a fixed bundle of goods chosen to represent the consumption of an average household. But what the average household buys changes with the arrival of new goods; and with changes in relative prices; as well as with variations – good and bad – in quality
It is a poor criticism of a thermometer that it does not tell us how comfortable we feel.
No economic model can describe “the world as it really is”.