First year Economics student wins the IEA's Monetary Policy Essay Prize 2022

We are very proud to announce that for the second time running, Warwick Economics student is the winner of the Monetary Policy Essay 2022 competition organised by the Institute of Economics Affairs (IEA) and the Institute of International Monetary Research (IIMR).

Guillermo Sagnier, first year BSc Economics student, took the top prize in the IEA and the IIMR essay competition 2022 which was launched in October 2021 with two questions: "Does inflation matter? And will the current inflation upturn be transitory or not?" The submissions were judged on their presentation, command of theory, the relevance of the questions and persuasiveness of the argument.

The Monetary Policy Essay Final took place in-person at the Vinson Centre (Buckingham) on 3 March 2022. Guillermo Sagnier took the first prize of £500, Irakli Imnaishvili and Aislin Rees tied in second place.

This is the second time that Warwick Economics student got the top prize in this competition. Last year the winner was Warwick Economics final year student Gustaf Dillner (BSc Economics, Politics and International Studies).

Guillermo only joined Warwick in September 2021 on the three year BSc Economics programme. He is Spanish and, for three years, he lived in Chile, which sparked his interest in economics.

We congratulate Guillermo on this fantastic achievement in his first year and wish him further successes.

We wanted to find out more about his studies here and what this achievement means to him and here is what he told us:

What made you enter this competition?

Being passionate about macroeconomics and understanding the world around us, I was curious to analyse why western economies had experienced significantly above-target inflation rates in 2021, whilst Asia had not witnessed such surge. Given supply chain disruptions and bottlenecks have affected globally, what explains such difference? When researching recent monetary trends and finding this essay competition, I decided to dive into the question.

Briefly describe the content of your essay and the arguments you used

I claimed the current inflation upturn in Europe and North America is a result of the extraordinary growth in broad money supply, caused by QE, ultra-low interest rates and the partial monetisation of fiscal deficits. The creation of excess money balances, mainly across financial institutions, has translated to a rise in asset prices (equities and real estate) and subsequently strong recovery of aggregate demand. Over time, this has led to a rapid increase in the price of goods and services, which will persist beyond 2022 (given still-high money supply growth rates and likely gains in the velocity of money) and further squeeze real incomes.

Tell us about the prize ceremony you attended?

The top ten entries from around 200 submissions were invited to the final at the Vinson Centre in Buckingham. The essay competition was open to all undergraduate and sixth form students and, remarkably, the second and third prizes were given to outstanding high school pupils. The session involved a ten-minute presentation in front of a panel of experts in monetary economics, followed by a five-minute Q&A of broad questions. It was great practice for my upcoming macroeconomics test!

What was your prize and how are you going to spend it?

I was awarded £500 and summer internships at the Institute of Economic Affairs and at the Institute of International Monetary Research. I will certainly not keep it as cash and move to inflation hedges!

What have been the highlights of your degree course at Warwick so far?

Although I am still a first-year student, my time here at Warwick has been thoroughly enjoyable. The highlights of the course would be how varied the discipline is: from economic history to statistics, you gain a wide range of skills. Campus life and societies are exceptional too and, as an international student, make up a very well-rounded experience.

What is your favourite module in Year 1 of our course?

EC108 Macroeconomics provides an overview of how national indicators such as employment, output or inflation are determined and correlate with each other. Although there are alternative models beyond mainstream economics (like the Quantity Theory of Money), the depth of the analysis and modelling has far exceeded my expectations.

What are your career plans?

I am very interested in monetary policy and would look forward to engaging with forecasting and central bank policymaking in the future. I am also curious about finance, especially asset and wealth management.

Related links:

The Institute of Economic Affairs

The Institute of International Monetary Research

Last year essay prize winner - Gustaf Dillner (March 2021)