Sam takes down the government's migration policy in City A.M.

Research director Sam Bowman explained what's wrong with the government's immigration target in today's edition of City A.M.

Read the case here.

Comment: Minimum Wage rise risks harming workers; cut taxes on the poor instead

Commenting on the Low Pay Commission's recommendation that the National Minimum Wage should rise by 3% today, the Adam Smith Institute's Research Director Sam Bowman said:

“The empirical evidence is pretty clear that minimum wage increases lead to more unemployment (http://www.nber.org/papers/w12663), slow growth in the creation of low-skilled jobs (http://www.nber.org/papers/w19262), and lead to long-term reductions in some people’s income by ‘kicking away the ladder’ and delaying their acquisition of workplace skills (http://www.nber.org/papers/w10656). These risks are significant enough that raising the minimum wage should be judged as, at best, a very risky way of helping the poor and runs the risk of harming them instead.

“Instead, there are two things the government should do to help the working poor. It should peg the personal allowance and, crucially, the national insurance threshold to the minimum wage level, so nobody on minimum wage pays any tax on their income. This would give full-time minimum wage workers almost exactly as much income as they would be on a “Living Wage” that was being taxed at current levels. If necessary, the 40p rate threshold should be lowered to offset this for those earners to make sure that this is targeted at low- and middle- income earners only.

“In the medium-term, the government should simplify the tax credits system and overhaul welfare in general along the lines of a ‘Negative Income Tax’, which automatically topped up low-income workers’ wages with a steady taper to avoid disincentivising work. The simpler income redistribution is, the better for low-paid workers.

“A 3% rise in the minimum wage is modest so the negative effects that it has are also likely to be modest. Nevertheless, it is still likely to be harmful on net. Rather than trying to shift costs to businesses, the government should accept that it cannot wave a magic wand to help the poor. Instead it has to accept the existence of trade-offs and find savings elsewhere to pay for much-needed tax cuts for the poor."

For further comment email sam@adamsmith.org.

The Adam Smith Institute is an independent libertarian think tank based in London. It advocates liberal public policies to create a richer, freer world.

Sam makes the case against prohibition

Research director Sam Bowman argued against drug prohibition Conservative Home.

Read the article here.

Charlotte explains why inheritance tax is bad in City A.M.

Digital policy editor Charlotte Bowyer made the case against inheritance tax in City A.M.

Read her argument here.

Eamonn quoted in City A.M.

ASI director Dr. Eamonn Butler was quoted in City A.M., blaming the rise in the use of food banks on the EU's Common Agricultural Policy.

Read the piece here.

ASI: still lots of slack in the labour market

Commenting on today's Labour Market release from the ONS, ASI Head of Macroeconomic Policy Ben Southwood said:

"Though the labour market looks strong, the Bank of England must not be complacent and it would be crazy to tighten policy now.

"Employment was up 193,000 on the quarter and 396,000 on the year, and the rate was up 0.3 percentage points; unemployment was down 125,000 on the quarter, 161,000 on the year, and the rate fell 0.4 percentage points to 7.2%.

"But the labour market is not yet what we'd call tight. Nominal wage growth is still running far too slow, suggesting the existence of substantial slack. Total earnings grew just 1.1% over the year to the last three months. By comparison earnings grew 4-5% for nearly every month of the 16-year great moderation.

"This, combined with well-below-target core inflation, suggests the Bank of England's policy is not too loose, and it would be premature to raise rates or roll back QE now."

For further comment email ben@adamsmith.org or phone 02072224995.

The Adam Smith Institute is an independent libertarian think tank based in London. It advocates liberal public policies to create a richer, freer world.

Land Registry privatisation report from 2010

Nigel Hawkins' 2010 report on privatising the Land Registry feature in recent commentary on privatising the body. Story from Today's Conveyancer here, and the Guardian here.

Read the research here.

More coverage for our work on Scottish independence

Sam's work on Scottish monetary arrangements if they went independent was covered further: on ITV.com, the Scottish Evening Times, the International Business Times, pro-Independence blogs (also here, and here), Realradio Scotland. He also debated Mark Wallace over whether these should and would worry Scots and change the course of the referendum.

Read Dr. Eamonn Butler's blog post on the issue here. And Read Sam's blog post here.

Sam's comments on Scottish independence and sterling widely featured

ASI research director Sam Bowman's comment that Scotland could keep the pound without British consent was widely carried: in the Scottish Sun, twice in the Guardian, in at least 24 local papers, in The Herald, and on Opendemocracy.net.

Read his whole statement here.

Comment: An independent Scotland would be better off using the pound without permission

Commenting on the Chancellor George Osborne’s announcement today that is likely to rule out an English currency union with an independent Scotland, the Adam Smith Institute’s Research Director Sam Bowman said:

“An independent Scotland would not need England’s permission to continue using the pound sterling, and in fact would be better off using the pound without such permission.

“There is very little that an English government would actually be able to do to stop Scottish people from continuing to use the pound sterling if they wanted to.

“As the American economist George Selgin has pointed out, what the Prime Minister really means is that the Bank of England would not act as a guarantor for Scottish banks or the Scottish government. Lucky Scotland: the implied promise of a bailout from the European Central Bank is exactly what allowed Eurozone banks and governments to borrow cheaply and get themselves into a debt crisis.

“Scotland’s position would be closer to that of countries like Panama, Ecuador and El Salvador, which use the US Dollar without American “permission”, and, according to research by the Federal Reserve of Atlanta, consequentially have far more prudent and stable financial systems than if they were part of a formal currency union.

“An independent Scotland that used the pound as its base currency without the English government’s permission, with banks continuing to issue notes privately and private citizens free to choose any currency they wanted, would probably have a more stable financial system and economy than England itself.

“It’s up to Scots to decide whether they want independence, but the Chancellor’s announcement today should be seen as a feature, not a bug.”

For further comment email sam@adamsmith.org or phone 02072224995.

The Adam Smith Institute is an independent libertarian think tank based in London. It advocates liberal public policies to create a richer, freer world.