Monday 6 August 2007

An "economic illiterate" responds

I came across this piece by Matthew Lynn in the current issue of The Business.

Lynn writes:

In a globalised economy, very few companies are owned domestically. Already 40% of the shares on the London Stock Exchange are owned by foreigners. It doesn’t make much difference whether your local supermarket is owned by a hedge fund manager in Zurich or an investment fund in Dubai. What counts is whether there is enough competition to make sure it offers good service and fair prices.
Not quite.

It may not make too much of a difference if one is simply considering the price of the weekly shop. But the location of a company's owners and especially of company head offices certainly matters if we are thinking about the wider economy. The Scottish media has had hundreds of articles on this very subject since I started reading newspapers. Head offices mean top jobs therein as well as highly paid professional advisors nearby. I'm not arguing for government interference here, rather for the ending of those factors that are responsible for the economic problems faced by "the provinces." (Scroll down)

Does Mr Lynn think that it would make no difference if the "London" Stock Exchange itself were to move to Liverpool, Limerick or Lyon?

1 comment:

David Farrer said...

Comments made on previous template:

David Farrer
That "Anon" was me!

13 August 2007, 16:24:18 GMT+01:00
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Eliminate all spending except police/courts and the military. 
See Sean Gabb's new book (Cultural Revolution, Culture War) for a good analysis of where we are.

9 August 2007, 09:11:24 GMT+01:00
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James Higham
How do you reduce government spending to 10% of GDP, David?

7 August 2007, 11:56:30 GMT+01:00
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Leave the LSE where it is: move "London".

6 August 2007, 21:33:39 GMT+01:00