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More data-intensive models could become a helpful tool for policy makers, according to Bank of England Chief Economist Andy Haldane.
In a speech focusing on how local factors can serve a wider understanding of the economy, Haldane said that the BOE can help build trust in its workings by tapping into communities, through its network of agents, or citizens’ panels. He also said the BOE was making increasing use of real-time data, such as administrative data on VAT returns, and using Google (NASDAQ:GOOGL) Maps to gauge the impact of Brexit disruptions at ports.
“Our global weather systems, oceans, information networks, supply chains, solar system, galaxies and even our universe can these days be mapped and modeled in microscopic detail in close to real time,” Haldane said in a speech in Sheffield on Tuesday. “We cannot yet do so for our economies. I believe our economic policies would be better able to serve the public, and better understood by them, if we could do so.”
The speech contained no views on current BOE policy, but did include praise for the work of University of Chicago professor Raghuram Rajan. Rajan has been touted as possible replacement for Governor Mark Carney, who is due to leave the BOE in January.