Skip to content
Friday 31 July 2026London --:--Frankfurt --:--Zurich --:--
NewslettersSearchEN · DE
City PM

European business, markets and politics

FTSE 100
10,979.28
+0.75%
DAX
25,865.30
+0.99%
CAC 40
8,563.81
+0.92%
STOXX 50
6,415.08
+1.11%
  • Europe
  • Markets
  • Business
  • Economy
  • Technology
  • Politics
  • Opinion
More
GermanyFranceBankingAIEnergyFintechPropertyCapital Markets
  • Germany
  • France
  • Europe
  • Markets
  • Business
  • Economy
  • Technology
  • Politics
  • Opinion
  • DE
Wednesday 14 October 2020 4:18 am  |  Updated:  Tuesday 13 October 2020 4:44 pm

Heavy-handed Westminster diktats have eroded trust — now only localised Covid policy can restore it

By: Paul Ormerod

Add as a preferred source on Google
BRITAIN-HEALTH-VIRUS-ECONOMY-TRANSPORT
People need to feel a sense of ownership of any restrictions which are asked of them

Last month, the official group of scientific advisers — SAGE — warned the government that only a quarter of those who need to self-isolate due to coronavirus symptoms were in fact doing so.  

This illustrates a concept which is of great practical importance: namely the conflict between individual and collective rationality.  

Consider Margaret Ferrier, an SNP MP (who has since had the whip removed) who travelled by train from London to Scotland despite knowing she had tested positive for Covid-19. Better for her personally to be at home in Glasgow than stuck in a London hotel for a week, but worse for society as a whole as she risked spreading the virus to everyone on the train with her.

The textbook model of economics neatly sidesteps this potential problem. It sets up an idealised situation in which there is no conflict between individual and collective rationality.  The task is then to discover what assumptions about behaviour are needed to be compatible with such an outcome.

It is a very challenging question, and several of the early Nobel Prizes in economics were awarded for work in this area.

Economics itself has moved on in recent decades and pays much more attention to the potential rift between what is good for the individual and what is good for society.

One of the most influential thinkers in this area is Elinor Ostrom who received the Nobel prize in economics only three years before her death in 2012. Her work is very relevant in the Covid crisis.

Her doctoral dissertation was on how farmers and others in Southern California solved the problem of water management in their local area. For individuals with favourable locations, it was rational to grab as much water as they could. But collectively, this was a bad outcome. Others would be short of water.

Read more

Finsbury lines up Games Workshop splurge using merger windfall

Games Workshop worked its way into the FTSE 100 last year.

The key feature of Ostrom’s work was to show that individuals were capable by their own actions of avoiding conflicts of individual and collective rationality. It was not necessary to have a heavy-handed regulator trying to impose a solution from above.

Like the Nobel laureates before her, she basically worked out what assumptions were needed for this to happen. 

An essential element is that those involved must have some feeling of being part of a group. Further, disruptive and self-serving behaviour should be speedily identified and punished, in ways which are seen to be fair within the group. People also need to feel a sense of ownership of any restrictions which are asked of them.  

When Boris Johnson announced lockdown on 23 March, in effect the nation was the group. For a period, most people behaved with proper regard to others.  

The subsequent maze of complex and often contradictory diktats issued by health bureaucrats and politicians since then has eroded much of this trust.  

Countries such as Germany which had locally based Covid strategies from the outset have fared much better than the centrally planned attempts in the UK, in part because they have been able to maintain this trust and sense of community.

At long last, the UK government shows signs of being willing to trust local authorities to do what is best for their area — in the form of local lockdown rules. They may still get it wrong, but local autonomy on Covid policy at least gives the chance of restoring the trust which is essential to any successful strategy.

Main image credit: Getty

Read more

Is ABBA Voyage suitable for children? You bet it is!

ABBA Voyage concert at ABBA Arena London with performers on stage and a large audience.

Share this article

  • Facebook
  • X
  • LinkedIn
  • WhatsApp
  • Email

Similarly tagged content:

Sections

  • Markets & Economics
  • News
  • Opinion

Categories

  • Economics
  • Opinion
  • Politics

Trending Articles

  • Gino D’Acampo restaurants face HMRC winding-up order

  • Lloyd’s of London allows staff to work from home as heatwave hits the capital

  • Grant Thornton partners pocket £35m from private equity deal

  • Rathbones suffers near £1bn net outflows as it braces for FCA probe fallout

  • Foxtons hits out at Renters’ Rights Act as profit halves

More from City PM

  • Finsbury lines up Games Workshop splurge using merger windfall

    Investing
    Games Workshop worked its way into the FTSE 100 last year.
  • Is ABBA Voyage suitable for children? You bet it is!

    Life&Style
    ABBA Voyage concert at ABBA Arena London with performers on stage and a large audience.
  • Second time lucky for Lucy Rigby?

    Markets
    City minister Lucy Rigby advocating for compulsory financial education in primary schools to empower young learners
  • The City will bid good riddance to Rachel Reeves

    Opinion
    Reeves Bank exterior with modern architecture, showcasing its sleek design and prominent logo on a sunny day.
  • Reeves issues warning to successor as she battles to defend record

    Politics
    Reeves is eying mortgage reform as a key growth driver.
  • Lady the right Choice with Yuen up

    Sport
    Nichola Yuen delivering a speech at a podium during a business conference, surrounded by attendees in formal attire
  • Fine dining and The Jab: A Michelin dinner with the Ozempic set

    Life&Style
    Ozempic tablet on a plate highlighting medications role in weight loss and diabetes management in healthcare news.
  • Making it in the UAE – Donna Benton

    Partner
    Donna presenting at The Entertainer event, showcasing new products, surrounded by an engaged audience in a lively atmosphere.
CityPM

Independent European business, markets and political news for decision-makers.

Morning Briefing

Europe

  • Germany
  • France
  • Europe
  • UK & Ireland

Business

  • Markets
  • Banking
  • Technology
  • Energy
  • Property
  • Fintech

Editorial

  • Opinion
  • Editorial Policy
  • Corrections
  • Contact

Company

  • About City PM
  • Privacy Policy
  • Terms of Use
  • Cookie Policy
© 2026 City PM Ltd · Published by CityPM Media, Bahnhofstrasse 65, 8001 Zürich, Switzerland
Privacy · Terms · Cookies · Facebook