In fact, the endogeneity of r* may have a silver lining: The very idea of endogeneity implies that we can influence the See Holzmann, R. 1997. Pension Reform, Financial Market Development, and Economic Growth: Preliminary Evidence from Chile. IMF Staff Papers 44. 149–178. 21 See Lámfalussy, A. 1985. The Changing Environment of Central Bank Policy. AEA Papers and Proceedings 75(2). 412.
That cynicism does not just permeate the foreign press and their audiences, but also infects our domestic debate. Every policy is greeted with suspicion and scrutinised for evidence of malfeasance. With no upside to making decisions, it is no wonder that decision making has slowed.