Economics

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    Brexit: New UK investments in the EU are growing, while new EU investments here fall

Brexit: New UK investments in the EU are growing, while new EU investments here fall

The UK’s vote to leave the EU has generated fears that UK firms are moving investment abroad because of Brexit. For example, media reports have documented that both large UK companies such as Barclays, HSBC and EasyJet, and smaller companies such as Crust & Crumb, a Northern Irish pizza maker, have invested in the EU27 in response to Brexit.

Has […]

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    Income inequality: firms have been reducing profit-sharing with workers

Income inequality: firms have been reducing profit-sharing with workers

Stagnating real wages and falling labour shares across developed economies have stimulated a renewed interest in the question of how, and to what extent, rents are shared with labour. Nicholas Kaldor’s (1957) long-held stylised fact that the fraction of national income going to labour is fixed has been questioned, for instance, by Karabarbounis and Neiman (2014), who show that the global labour […]

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    With every relocation out of London because of Brexit, the capital’s revenues suffer

With every relocation out of London because of Brexit, the capital’s revenues suffer

The departure of the European Medicines Agency from its home in Canary Wharf to Amsterdam may sound like an odd place to start a post about the impact of Brexit on London’s transport system. But it’s not as strange as you might think.

At the end of January, this EU agency – which has been based in London for over […]

February 9th, 2019|Economics|0 Comments|
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    The challenge of dealing with ‘double disruption’: Brexit and technology

The challenge of dealing with ‘double disruption’: Brexit and technology

Our work at the Institute for the Future of Work (IFOW) has been focusing on two major forces of disruption that the UK economy is experiencing. The first, Brexit, will involve a sharp change in the structure of economic activity. Membership of the European Union has shaped the British model of capitalism and the structure, and operation, of core industrial […]

Why the EU-Japan trade deal matters for the UK

On February 1st, the EU-Japan Economic Partnership Agreement (EPA) entered into force. Rightly described as a ‘mega-deal’, since it covers 27.8 per cent of the world economy and more than a third of global world trade, the event still received relatively little attention. Yet the deal truly matters both economically and politically, especially at a time when most headlines […]

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    The 2008 crisis failed to displace neoliberalism’s core principles

The 2008 crisis failed to displace neoliberalism’s core principles

It is now over ten years since the collapse of Lehman Brothers paved the way for the biggest, most global, and most significant financial crisis in living memory. It brought the global capitalist economy to its knees, it shook belief and faith in the capitalist system itself, and raised serious doubts about neoliberalism.

The hope that the crisis would give […]

February 2nd, 2019|Economics|1 Comment|
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    When Britain becomes ‘New Australia’: on the economic impact of immigration

When Britain becomes ‘New Australia’: on the economic impact of immigration

It is the year 2060, and global warming has turned Britain’s climate warm and sunny — rum rather than whiskey is now distilled in Scotland, using sugar cane grown in the Outer Hebrides. Realising that true British culture could not thrive without year-round cold drizzle and grey skies, in 2020 a farsighted government launched Brexit-Ultra, the plan to quit […]

January 31st, 2019|Economics|0 Comments|

Why policy failure is so common in the UK

It has always been the case that the likelihood of policy failure is at least as high as policy success. But the currency of modern politics seems to be squarely that of failure – indeed major failure. The most prominent current British examples are Brexit, closely followed by Universal Credit, and now a new NHS Ten Year Planthat disavows the extensive […]

January 26th, 2019|Economics|0 Comments|
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    A study of Catholic missions in India shows that higher education leads to prosperity

A study of Catholic missions in India shows that higher education leads to prosperity

Why are some places richer than others? Economists offer many answers to this question ranging from better institutions to favourable geography to more education. Much of this research looks at differences across countries in the hope of identifying specific conditions that are present in rich countries but absent in poor countries.

But countries differ along many dimensions such as culture, […]

January 24th, 2019|Economics, Education|0 Comments|

Foreign direct investment can trigger industrial upgrading

Industrial upgrading, which encompasses improvements in product quality, productivity and export performance among manufacturing firms, is a key driver of economic growth in developing and middle income countries. Yet despite its importance for policy choices, relatively little is known about the determinants of product upgrading at the micro level.

Our recent work aims to shed some light on this issue by […]

January 23rd, 2019|Economics|0 Comments|
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    The discredited economic vision at the root of France’s ‘gilets jaunes’ problem

The discredited economic vision at the root of France’s ‘gilets jaunes’ problem

At the end of the month of November, France suddenly went into revolution mode. Cars were burned and barricades were erected on the Champs-Élysées in Paris and there were prolonged battles between the ‘forces de l’ordre’ and the demonstrators. Hundreds of people were injured and nine deaths have been attributed directly or indirectly to the movement which had a […]

January 21st, 2019|Economics|1 Comment|

The implications of a no-deal Brexit: is the EU prepared?

Overall, a no-deal Brexit would be disruptive in the short-term:

There would be immediate very significant administrative and logistical challenges in trade. Preparations to reduce those disruptions are underway but are unlikely to be sufficient. But while Most-Favoured Nation tariffs will affect some sectors significantly, the macroeconomic effect on the German economy might not be huge.
If the UK […]

What prevents us from cooperating?

Cooperation is an essential aspect of life, from bacterial biofilms to social insects, and from friendships and workplace collaborations to environmental conservation, political participation, and international relations. Yet establishing cooperation in a competitive world suffers from two closely connected problems. For one, there is the risk for cooperators to be the “sucker”, i.e. one of the few people cooperating […]

January 15th, 2019|Economics, Management|0 Comments|

No deal? How did we get here?

The postponement of the parliamentary vote on the withdrawal agreement until the middle of January has led to accusations that Theresa May is ‘running down the clock’ on Brexit. By scheduling it close to the latest possible date, MPs’ ‘meaningful vote’ is rendered rather meaningless, given the acute shortage of time to develop alternatives should the agreement fail to […]

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    The modest role of human capital in explaining international income gaps

The modest role of human capital in explaining international income gaps

Low output per worker goes together with low levels of schooling, cognitive test results, and health indicators, leading naturally to the conjecture that low levels of human capital are responsible for low levels of income. This conjecture has contributed to motivate several decades of international focus on policies aimed at increasing the quantity and quality of schooling, as well […]

January 8th, 2019|Economics|0 Comments|
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    What explains the contemporary geographic distribution of Islam?

What explains the contemporary geographic distribution of Islam?

What explains the contemporary spatial distribution of Muslim communities worldwide? Our study’s contribution is twofold.

First, we investigate the role that ancient trade routes have played in facilitating the spread of Islam. Motivated by numerous case studies on the historical relationship between trade and Islam, we construct detailed data on pre-Islamic trade routes, ports and harbours, and establish that proximity […]

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    Robotisation could help ‘reshore’ manufacturing jobs back to Europe

Robotisation could help ‘reshore’ manufacturing jobs back to Europe

One would be hard-pressed to find many commentators ready to say Europe’s manufacturing industry is coasting. Rather, the last decades have been quite competent at throwing several challenges towards our economic model. The 2018 European Trade Union Institute (ETUI) Conference “The World(s) of Work in Transition” managed to name a few: Climate change, demographic transitions, digitalisation, automation and finally the nexus […]

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    The local identity of department stores is key for their survival

The local identity of department stores is key for their survival

Department stores have experienced a dramatic decline in fortunes in the last decade or so. One hundred years ago, they were the epitome of modern retailing and throughout the twentieth century they were the lynchpin of high streets and the anchor for shopping malls. But now they seem in terminal decline across the globe: La Samaritaine, the luxurious Parisian […]

January 3rd, 2019|Economics|0 Comments|

When Britain turned inward

In a recent survey paper, Goldberg and Pavcnik (2016) note that trade economists have moved away from studying the impact of trade policy. Concluding that this may reflect the fact that trade policy has become so liberal, they ask a straightforward question: “Does trade policy matter?”, Indeed did it ever matter?

With Brexit looming, and protectionist pressures mounting elsewhere in […]

December 18th, 2018|Business History|0 Comments|

Brexit puts the digital single market in jeopardy

A key component of the EU’s single market is its digital single market (DSM), which has been a particularly important for the UK. Currently, the UK’s largest export market for digital services is Europe and the DSM enables access to European markets. Brexit is expected to affect the UK substantially in the areas of broadcasting, creative content production, data […]