Interest rates at a historic low

As I write, interest rates in the United Kingdom have been cut to the very low level of just one quarter of one percent.  At least one news outlet is arguing that this is intended to help the economy through the post-referendum turmoil.

I am not aware of any statistical evidence to back up the widely held belief that low interest rates benefit the economy, but if anyone knows of such evidence then comments are welcome.

Many years ago I saw a famous businessman being interviewed on television.  Asked what retailers wanted, he replied that they wanted an interest rate cut.  On the one hand it is true that an interest rate cut allows people with mortgages to spend more money in the High Street, but it also reduces the spending power of people with savings.

I wonder why the famous businessman did not ask for a tax cut instead.  Cutting taxes would presumably leave at least some taxpayers with more money to spend in the High Street.  Why did he not ask for a cut in the price of bus fares?  Lower prices for bus fares would leave bus travellers with more money to spend in the High Street.

Then again, why did the famous businessman not ask for a cut in the prices charged by High Street stores?  If one High Street store cuts its prices, then presumably its customers have more money to spend in the shop next door - or am I missing something?

Maybe interest rate cuts are just an easy target.  Bus companies can cut the price of bus fares, but they still need revenue to pay for the cost of vehicle maintenance, staff wages, and so on. By contrast, it is not clear to most people what interest rates actually pay for.  Some of the money is paid out to savers, but as a saver myself I know that interest received is rarely more than a pittance.

Then again, it does not make sense to get sidetracked.  I have yet to see any serious evidence that low interest rates necessarily benefit an economy, or that high interest rates necessarily harm an economy.

Related previous posts include:
Understanding interest rates
Interest rates, inflation, and jobs