‘Wise Man’ David Blanchflower quits

David Blanchflower (pictured), one of the nine 'Wise Men' at the Bank of England who set the nation's interest rates, has announced his intention to step down in the New Year when his three-year term ends. His decision to quit next May will add to the pressure on Governor Mervyn King, described by Jonathan Foreman in his report for The First Post today as "giving a very good impression of a man overwhelmed by events" in his dithering over the financial crisis.

Blanchflower, 56 and a professor of economics at Dartmouth College in New Hampshire, from where he commutes monthly to the Bank of England, spent much of the last year advocating that the Bank cut interest rates. Since November 2007 he has voted 13 times for rate cuts, often as the only dissenting voice among the nine members of the panel, including King.

When the gravity of the economic situation finally hit home with the other members, they followed Blanchflower's lead and have slashed rates by almost two-thirds in the last two months to just two per cent, its lowest level for more than 50 years.

But Blanchflower has taken no pleasure in being right about the need for rate cuts: he told the Guardian last month that "I'm very upset that I got it right. I think of it as the winner's curse. This is not something I wanted to get right."

Blanchflower is not the archtypical academic economist: his research into the economics of happiness once led him to put a value of $50,000 a year on a regular sex life. He is also a keen snowmobiler; his close friend the author Bill Bryson once wrote a story about their exploits together in winter.