Coming soon: Economics for Business

It's official: I am excited! It has been ten years since my first book, Focus on Financial Management was published by Imperial College Press, so a new book is long overdue. On November 3rd my latest attempt at a very student-friendly book, Economics for Business, will be published by Kogan Page. I am led to believe that my University will be hosting a "book launch" at some stage.

Writing a textbook for students is a venture fraught with immense difficulty. The writing itself can be tedious and lonely, in some cases made all the more frustrating by reviewers' and editors' comments with which you disagree. In my case, the editors at Kogan Page have been little short of incredibly supportive and encouraging, making this a very enjoyable journey. However, probably the biggest difficulty is that the students for whom I wrote this book (and my previous book) are not necessarily going to discover it and buy it. A student tends to buy a book because it has been recommended (or, more often, required) by their University instructor for a particular course. Thus, while I have made every effort to make my book immensely readable, engaging and student-friendly, it will also need to attract the interest of lecturers if it is to sell.

Far too many books with the same of similar title appear to be texts on Economics with a nod to Business. There are often business examples, but more usually as bolt-ons rather than integrated into the underlying theory. I hope this is a pitfall I have been able to avoid. I hope you will agree.

While I have enjoyed the process of writing this book over the past two years I am also pleased to see the process finally come to a fruitful end. I hope that you will purchase a copy of it: at £29.99 it is very much cheaper than many University-level texts, written especially for students. It has been reviewed by some of my own students to ensure that it achieves what I set out to achieve. I hope you will agree. When the "launch" is announced I hope you will be able to attend. I will be happy to sign your copy should you desire!

You can pre-order a copy of Economics for Business directly from Kogan Page (www.koganpage.com/product/economics-for-business-9780749470197) or Amazon (www.amazon.co.uk/Economics-Business-Decision-Complex-Macroeconomy/dp/0749470194/ref=sr_1_1?ie=UTF8&qid=1445522045&sr=8-1&keywords=ivan+k.+cohen). It is also available at Book Depository (www.bookdepository.com/Economics-for-Business-Ivan-Cohen/9780749470197) and Bokus.com (www.bokus.com/bok/9780749470197/economics-for-business/) as well as Barnes & Noble (www.barnesandnoble.com/w/economics-for-business-ivan-k-cohen/1122049878?ean=9780749470197).

We are all ... or are we?

Throughout modern history commentators from various sources have resorted to declaring a particular viewpoint as the mainstream orthodoxy by suggesting that "we are all ....". Thus, in 1888, William Vernon Harcourt, a British politician (Liberal party) declared "we are all socialists now". Looking back 130 years, this now appears as ludicrous hyperbole. Even when made with genuine earnestness at the time, such declarations will almost always be proven to be incorrect by the fullness of time.


The phrase "we are all Keynesians now" was originally attributed by Time (1965) to arch-Monetarist and Nobel Laureate, Milton Friedman. A renowned anti-Keynesian, Friedman tried to clarify his stance in a 1966 letter: "In one sense, we are all Keynesians now; in another, nobody is any longer a Keynesian." What Friedman intended to convey by this statement is difficult to determine, but we know for certain that he was no great proponent for Keynesian economics; to the contrary. It is reasonable to suggest that Friedman was making the point that Keynesian economics had become the mainstream orthodoxy of the 1960s, to the detriment of other perspectives. In many ways this could be seen as a variant of Goodhart's Law: in this case, when a particular economic doctrine becomes mainstream, the economy ceases to operate as that doctrine suggests, thereby making its policy prescriptions valid.

The same phrase later became associated with (and then attributed to) US President Richard M. Nixon. A Republican, with natural tendencies towards less government intervention, Nixon pragmatically found himself embracing orthodox Keynesian interventionist policies during the early 1970s. In 1971, after removing the United States from the international gold standard, Nixon was quoted: "I am now a Keynesian in economics".

In 2002, UK Labour politician Peter Mandelson declared in an article in The Times that "we are all Thatcherites now", suggesting that acceptance of the policies of Margaret Thatcher was now rife, even among the other political parties in the UK. That these other parties had strongly fought and contested Thatcherite policies at the time of their instigation was now a matter of history.

Following the financial crisis of 2007, the phrase "we are all Keynesians now" gained new life, when economists called for massive investment in infrastructure and job creation as a means of economic stimulation. It is a matter of historical record that many governments opted for the exact reverse, bringing in 'austerity' policies.

Following the Iowa cucuses in 2012, Republican presidential candidate, Ron Paul offered a different perspective: 'I'm waiting for the day we can say, 'We're all Austrians now.'" Austrian economics has long been side-lined by mainstream perspectives. However, it takes the view that markets are better placed than governments to deal with economic issues. They argue that less government intervention is better, a laissez faire view of the world which is in stark contrast to Keynesian economics. However, while the right wing of the US political spectrum advocate less government, their aims tend to be more vocal than concrete. For government to vote to remove itself from economic intervention would seem tantamount to the proverbial turkeys voting for Xmas!

So are we all anything now? After all, before the publication of his General Theory.... in 1936 Keynes was as much as "classical economist" as anyone else. By 1936 he had changed his views, although he never became a Keynesian (in the same way as Marx never became a Marxist). As he was fond of noting: "When the Facts Change, I Change My Mind. What Do You Do, Sir?"

I would argue that economic perspectives are like popular music. In the 1950s and 1960s all popular music was mainstream, with few diverse genres. This was also true for economics. In the 21st century "pop music" is simply one genre among many others which make up popular music. This includes reggae, country, hip hop, house, trance, and many others. It is the same with economics: nowadays almost anything goes. Economists have increasingly gone tribal, with individual economists often having affiliations with more than one school. And where do I fit? Like Keynes, when the facts change I change my mind.

The importance of Higher Education

For my father's generation education was they key to everything: success, happiness, social mobility, prosperity. Brought up during the years of the Great Depression and World War II, his generation suffered the kind of deprivation which most of us can only imagine. Yet, alongside that deprivation, others continued to thrive.

During my youth my parents inculcated in me the importance of getting as good an education as possible. Without it I would have ended up as factory fodder, with low income and virtually zero job satisfaction (whatever that is). With the best education the British welfare state could provide I have managed to avoid deprivation and live in a fairly affluent manner, my wife and I providing for our kids at a level unimaginable when I was their age. And without the loss of any job satisfaction.

As an economist I genuinely believe that education is the key to the future. It may not guarantee happiness, but it can improve a person's chances of success, social mobility and prosperity. At a macroeconomic level it is the primary generator of economic growth in the medium- and long-term, especially at the level of Higher Education (HE). And yet, it appears that post-secondary education in the UK is under attack, and in decline on global relative league tables. That attack comes from several fronts, of which the most important is the lack of vision among UK governments for nearly a decade.

For HE to succeed it needs to be able to attract the best potential, regardless of their current position on the socio-economic ladder. For this to occur, the funding of HE must not act as a hindrance to access; currently it does. To not invest in the future minds of young people is not only economically damaging, it is also morally abhorrent.

At the time I entered University, UK HE was based on the Robbins principle: that HE "should be available to all who were qualified for them by ability and attainment". It was recognised that HE was an investment, not only in the individual, but also by the state in the future of the state: a social investment. Thus, if you were good enough the state paid your fees and provided an income-based maintenance grant.

At that time less than 10% of the population went into HE, a figure far exceeded today. And things are more complicated by the legal requirement to treat all EU students equally. So how might we return to a system similar to that which gave me a "leg up" in society? One that promotes HE? I believe the principle is simple, and not so very different from that which prevailed in the early 1970s. Back then, to qualify for payments of fees and a grant you had to be UK-resident for three or more years. I would argue that a similar system in place today would ensure that good minds from poorer backgrounds would not be deterred from entering HE, and also be primarily available for UK students without breaching EU regulations, thus it would not only be affordable, but the future benefits to the UK would significantly outweigh the costs to the public purse (i.e. the taxpayer).

It is time that we demanded a longer-term perspective, especially on education, from the governments we elect in this country. To do anything else is an economic and moral abdication of our duty to future generations.

(also available on LinkedIn: https://www.linkedin.com/pulse/article/importance-higher-education-ivan-k-%25E5%258F%25AF%25E6%25B1%2597-cohen/edit)

Football prices

Tomorrow (Thursday 14th August) the Football Supporters' Federation, together with fans from many football clubs, is holding a demonstration in London demanding "Affordable Football for All".  Meeting at 1pm at Marble Arch, they will be marching on the headquarters of the Premier League and Football League. Full details are available at FSF March.

As a season ticket holder at White Hart Lane the emotional side of my brain wishes the FSF well and approves of their objective wholeheartedly. My season ticket for 2014–2015 costs around £900 and is one of the cheaper seats at Spurs. This means an average of around £45 per game. This includes TWO cup games, one of which will be the Europa League playoff game against Limassol on 28th August. When I first became a season ticket holder at Spurs the cost included six cup matches, something which has become reduced over a period of two decades. £45 per game is quite expensive, especially as it is not the only cost of attending football: there is also transportation, refreshments, possibly a matchday programme, and for some a few drinks before, after or both. Then there is merchandise: almost all fans at some point during the season will purchase official merchandise to show their loyalty. And there is also the associated cost of satellite TV, be it SKY, Virgin or BT. One might claim that supporting your football team is an addiction. An expensive addiction!

Supporting your football team in the English Premier League is not cheap. But when I consider it from my perspective as a professional economist I come up with a different conclusion, one which the FSF will not like.

As a Spurs' supporter I notice that for most games there are very few empty seats in the ground. Even when the weather is worse than inclement, even when the match is being broadcast live on TV, even when the team is not playing as well as we supporters might hope. I also note that there is a significant waiting list for season tickets. By way of example, my 16 year old son has been a Member for more than a decade and recently made it to the top of the waiting list for a Youth season ticket, which we naturally jumped at (it's about a third of the price of my own season ticker). Members can find out where they are on the waiting list by going to their Spurs online account. I understand that the current waiting list is in the tens of thousands, which Spurs hope the new stadium will be able to accommodate. My understanding is that the same is largely true of most other EPL clubs, even Manchester United, whose stadium has a whopping capacity of around 70,000.

All of this is evidence of demand to attend matches in excess of the supply. As anyone with a basic understanding of economics will tell you, excess demand usually leads to price rises. As long as there is no demand shortage there is no economic case for football clubs, including Spurs, to reduce prices. However, I feel sure that the FSF will argue there is a moral case. So let's conduct a brief thought experiment to see what would happen if EPL clubs reduced their prices significantly:

Again, as anyone with a basic understanding of economics knows, if the price of season tickets (or per game) was reduced it would lead to movement down the demand curve. The quantity demanded would increase, possibly significantly. This would mean that even more supporters would find themselves unable to attend: more would wish to attend at a lower price, yet the capacity remains unchanged. Lowering price below its equilibrium always leads to a shortage. This would make football supporters in general much more hostile than they are currently, as there would be more of them dissatisfied. One of the possible repercussions of this would be to generate an even larger "black market" for tickets than currently exists.

The FSF has also argued that increased TV money could be used to reduce prices, but this would do nothing to eliminate the issue which I have outlined above. The amount of TV money is largely an irrelevance in setting season ticket or matchday prices. It is a hoary old argument that was dismissed in economics over a hundred years ago with Alfred Marshall's positing of both supply and demand as determining price (not simply the former, based on costs).

I am delighted that the FSF is bringing the attention of football pricing to the EPL and FL. It is something they need to note, as current conditions will not always be the case. However, I doubt very much that they will be successful, as it is not possible to beat the market: it always comes back to bite you where it hurts most.

Kick Racism Out Of Football: antiSemitism debate

Those of us of a certain vintage can recall when racism was less than unusual at football matches in England. The spite and bile which greeted the earliest black players in this country will forever be a stain on the character of English people, and especially football supporters. Thankfully things have moved on considerably, with racism now being the province of a few small-minded bigots. Changes in the law have helped speed up changes in attitudes, so that the vast majority of the football-going public are now loath to tolerate racial intolerance.

And yet, in recent years there has been a slow return to some of the racism that many of us thought had been removed from football. While much of this has come from perhaps unsurprising overseas sources, there still remains work to be done in England. Much of this work is being done quietly, but effectively by organisations such as Show Racism The Red Card (www.srtrc.org) and Kick It Out (www.kickitout.org).

A few weeks ago (8th April) I had the pleasure and honour of being invited by Kick It Out as a guest speaker for an event being held at the National Football Museum in Manchester (www.kickitout.org/join-spurs-legend-garth-crooks-for-free-y-word-debate/). The focus of the evening was a debate on the use of the "Y-word" in football. The other panellists included Anthony Clavane (sportswriter and author of Does Your Rabbi Know You're Here?), David Conn (sportswriter for The Guardian) and Alex Goldberg (Chair of the FA's Football and Faith Group). The chair was originally meant to be occupied by Garth Crooks, but owing to duties elsewhere he was unable to attend and the meeting was ably chaired by Kick It Out's Director, Roisin Wood.

The discussion was divided into two halves! The first half was devoted to discussion of whether or not the usage of the Y-word by Spurs fans was in of itself racist; the second half was devoted to a more general discussion of racism and antisemitism in football, preceded by a showing of the Baddiel brothers' film on "Yids", which takes an un-nuanced, negative view of usage of the word in any context. It was a pity that the team responsible for the 3 Spurs' fans who had been arrested for usage of the word "yids" (or one of its variants) did not appear until the second half of the debate. Their desire to bring their experience to the debate would have been particularly helpful during the first half, but following the break discussion had already moved on to the more general aspects.

A quick summary of the panel's views might be as follows: My own views have already been aired on this blog on more than one occasion. For me context is everything. However, Anthony Clavane took a different view, largely coloured by his having been on the receiving end of negative usage of the word in his youth by antisemites. David Conn took a more liberal approach, while Alex Goldberg appeared to be more in line with Anthony. However, while decrying its use by Spurs' supporters, Anthony was not in favour of arrests or legislation.

It was an interesting evening, made all the more special for me sharing a platform with two such illustrious and renowned sports' writers (in particular). The audience were also lively and made for some interesting contributions to the debate. It was a debate that could have gone on for MUCH longer, and might perhaps have been more effective had it been held in a north London venue, such as Tottenham Hotspur's ground. I remain hopeful that should this debate continue Kick It Out will sponsor such an event in the near future.

In memory of Darren Alexander

It is some 20 years since I first met Darren Alexander. At that time there was only one online forum for Spurs supporters: the original (and best) Spurs-List established by Bruce Munro. Prompted by Norman Fenton, I had established a football team for members of the Spurs-List, and ran training sessions every Sunday in Barnet. I had sent out a request for additional players, and received an e-mail from Darren, then operating under the e-mail address of teddy@lerman.co.uk. He showed up at our next training session, volunteering to play in goal, a position he occupied for several years as the Internet Hotspurs went from strength to strength. From that time on, Darren and I rapidly became firm friends. It wasn't too long before we were schlepping together to away matches, usually in his car. And he always went out of his way to ensure there was a steady supply of beigels from Brick Lane to keep us nourished on both legs of the journey. At the time Darren also had some Oasis CDs, which became a staple on those journeys. This was during the middle 1990s, when Spurs' performances were much poorer than anything some supporters are moaning about today.

When the woman who became my wife came over from Israel for a trip in 1996, we piled into Darren's car for the trip to Blackburn. Ever since that time, Darren became an effective member of our family. He attended our wedding, our son's brit milah and his bar mitzvah. Last year he even gave up going to see Spurs play a cup game in Leeds as he had promised to be at my daughter's bar mitzvah. For a Spurs fan as committed as Darren to miss a match is almost unthinkable, but his devotion to his closest friends and family meant that he would always go above and beyond. Although Jewish, Darren was very liberal in his approach, yet fiercely proud of his heritage. Every year around this time, my wife and I would invite Darren to join us for the Passover seder, although he never did manage to come along.

In recent years this devotion to Spurs has taken up his time in his role as joint Chairman of the Supporters' Trust, a job he undertook with all of his usual passion and commitment. It is sadly ironic that he passed away before learning of the CPS decision not to prosecute the 3 Spurs fans who had been arrested for chanting "yids", a campaign which was close to his heart as a Spurs supporter, as a Jew, and as a believer in important values such as freedom.

Darren was also a man who, despite having a very large circle of friends and acquaintances, felt the absence of a special woman in his life. In the past year or so he became attached to Katrina, the soul-mate he had been seeking. My thoughts and prayers go out to her, and also to Darren's immediate family, for whom his loss is the greatest.

There are too many anecdotes to include in a short tribute to my great friend, Darren. I remain numbed by the suddenness of his passing, and bereft at his loss. Those who knew him knew him to have an appetite for life which matched his appetite for more things more epicurean (ask me about the burger he demolished at Leicester Forest). He was a man with whom I shared many values and many adventures. He was a man who was always there for me when needed, and I hope that I was there for him in his too-short life.

We pass but once through this short life, but it is made happy by the wonderful people we meet along the way. Darren was such a shining light, now extinguished. He shall be missed greatly.

Jermaine Defoe ... He's a ....

Yesterday I went to see Spurs gain a narrow victory over Everton at White Hart Lane. As always, it was nice to see a number of friends from near and far. However, for me, the most memorable turn of events happened after the final whistle.

It was nice to see the affection in which Jermain Defoe is held by his team-mates, which echoes that of the Spurs' faithful. This being his last game before jetting off to play in Canada, Defoe was launched onto the shoulders of his team-mates to be paraded before the home support. The crowd, of course, launched into their usual rendition of "Jermaine Defoe, he's a yiddo", a chant with which he has been greeted with smiles for many years.

It surely cannot be less than obvious to anyone of at least moderate intelligence that referring to Defoe in this way was not meant as a form of abuse, bigotry or other racial epithet. To the contrary, it was an outpouring of affection and admiration. One can only hope that with three Spurs supporters now awaiting trial for similar use of similar terms, the police and CPS will come to realise the error of their ways.