CEP

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    UK economic problems: diagnosing is easier than coming up with solutions

UK economic problems: diagnosing is easier than coming up with solutions

With Boris Johnson’s launch of his “New Deal” and Michael Gove’s speech on “the privilege of public service”, the government has made clear its intention to press ahead with the domestic agenda of “levelling-up” and reform of government on which it was elected. There was little surprise in either announcement, with all of the elements to be found previously […]

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    How will Covid-19 shape the future economic role of the British state?

How will Covid-19 shape the future economic role of the British state?

When the pandemic has passed into history, what will be its implications for the role of the state in our economy? Some think it will (or should be) the replacement of one -ism with another. But to see the issues we face next through the prisms of an -ism could prove more of a prison than a roadmap. Ours […]

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    Building back better: policies for a strong and sustainable recovery

Building back better: policies for a strong and sustainable recovery

The Covid-19 crisis is already inflicting serious damage on both the UK and the global economy. This raises questions on the appropriate policies for a strong and sustainable recovery, contributing to global efforts to avoid a depression, and delivering on overarching governmental objectives, including reaching net-zero emissions and reducing inequalities across and within regions. On 14 May 2020, the […]

How is Covid-19 affecting businesses in the UK?

The Covid-19 pandemic and lockdown have highlighted the need for real-time data to understand the spread of the disease, identify vulnerable groups and design policies to mitigate the health and economic fallout of the crisis. While several new efforts to collect individual data are being made (Adams et al., 2020), data on businesses is more limited.

A relatively under-utilised source […]

The future of apprenticeships is in the balance

The unprecedented economic upheaval brought by the Covid-19 pandemic raises several concerns for the functioning of the English apprenticeship system, particularly in the medium-term as economic and social activity resumes.

Even in normal times, firms with apprentices may fail: usually disruption is minimised by reallocating apprentices to other firms. But economy-wide downturns exacerbate this problem because of the risk that […]

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    Covid-19 and the international trade downturn: lessons from 2008

Covid-19 and the international trade downturn: lessons from 2008

The current Covid-19 outbreak is raising a number of growing concerns about the UK economy and its capacity to cope with the current situation and recover in the near future. One particular area of concern, in the UK and elsewhere, is related to international trade, i.e., trade of goods and services across countries. More specifically, the World Trade Organisation […]

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    Covid-19 is increasing the divide in life chances between rich and poor

Covid-19 is increasing the divide in life chances between rich and poor

Social distancing measures during the coronavirus pandemic has given a new meaning to the problem of low social mobility. But make no mistake: the long term reverberations of the crisis will likely exacerbate the divide in life chances between the poor and privileged. Covid-19 has the scope to increase the toxic mix of rising economic and education inequality that […]

The Covid-19 recession is creating a crisis of inequality

The Covid-19 pandemic is turning into a global recession – probably the biggest drop in economic activity since the Great Depression of the 1930s. The latest forecasts put UK and US GDP both down by about 10% in the second quarter of 2020 (40% on an annualised basis). GDP is an important measure of economic wellbeing, but the key […]

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    Covid-19: We shouldn’t give priority to sustaining the GDP over the wellbeing of the people

Covid-19: We shouldn’t give priority to sustaining the GDP over the wellbeing of the people

We are in a very difficult situation. But I do believe that if we handle it right we can come out of this better than we went into it. We can come out of it with a society in which people are caring more for each other and in which they are taking better care of themselves.

So, let me […]

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    We can increase happiness through public policy – and in our jobs and private lives too

We can increase happiness through public policy – and in our jobs and private lives too

Thomas Jefferson said that ‘The care of human life and happiness… is the first and only legitimate object of good  government.’ We agree with him, as did the LSE’s main architects – the Webbs and William Beveridge. So too do an increasing number of policymakers worldwide: only last October, the European Union’s Council of Ministers requested that all of […]

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    If the UK is high tech, why is productivity growth slow? Economists weigh in

If the UK is high tech, why is productivity growth slow? Economists weigh in

The UK has seen slow rates of productivity growth over the past decade, with output per hour and real wages no higher today than they were prior to the global financial crisis. The February 2020 Centre for Macroeconomics (CFM) survey asked its panel of top UK economists about the causes of and possible policy responses to slow growth in UK […]

Does more competition spur innovation or discourage it?

Increased levels of global trade integration, especially driven by the rise of China, have led to a fierce public debate about the winners and losers from international trade. Recently, calls for protectionism have become louder in many countries, leading to a backlash against globalisation (OECD 2017).

When it comes to firms, the increase in import competition has led researchers to […]

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    Technology can benefit a few superstar workers, at the expense of everyone else

Technology can benefit a few superstar workers, at the expense of everyone else

Technical change is disrupting many labour markets and is re-shaping the world of work. A widespread fear is that new technologies generate winner-take-all labour markets that benefit a small group of superstars, at the expense of the majority of the workforce. These so-called “superstar effects” arise when technologies open up bigger markets and make it possible to reach consumers […]

Brexit: mourning the economic and personal damage

Britain has left the European Union (EU). The loss I feel is almost as much as when my father died, almost a quarter of a century ago. He was 16 when he came to Britain with my grandfather, who was a South African political refugee. After completing his UK national service, he married the daughter of a Merseyside dockworker. […]

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    Silicon Roundabout: did light touch policy interventions work?

Silicon Roundabout: did light touch policy interventions work?

London’s technology ecosystem is thriving. The city has over 50,000 tech firms, with over 260,000 employees. Venture capital investment rose from £384 million in 2013 to £1.8 billion in 2018. A number of companies, such as Deepmind, Transferwise and Deliveroo, have become unicorns, valued at more than £1 billion. It survived the financial crisis and is — so far […]

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    To meet its ambitious ‘net zero’ target, the UK will need to ramp up climate change policies

To meet its ambitious ‘net zero’ target, the UK will need to ramp up climate change policies

UK greenhouse gas emissions are declining and have been declining for some time. The UK has a framework of long-run targets developed by the Committee on Climate Change, an independent body of experts advising government. Despite this, things are far from well when it comes to climate change in the UK and there are concerns about the country’s ability […]

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    Brexit will leave the UK worse off economically in all scenarios

Brexit will leave the UK worse off economically in all scenarios

Since the UK voted to leave the European Union in June 2016, Brexit has dominated UK politics and economic policy. Three and a half years after the referendum, the UK is yet to leave the EU, there is no certainty over if or when Brexit will take place, and the shape of future UK-EU relations is yet to be […]

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    John Van Reenen: ‘A lot of promises are just smoke and mirrors’

John Van Reenen: ‘A lot of promises are just smoke and mirrors’

As director of LSE’s Centre for Economic Performance (CEP) up to 2016, British economist John Van Reenen led a team of academic researchers who produced detailed analysis of the consequences a divorce from the European Union would have on the UK economy. They predicted a fall in GDP, employment, direct investment, wages and productivity. Of these indicators, only employment […]

Economic insecurity breeds support for the right

Economic insecurity is attracting growing attention in social, academic, and policy circles. It has arguably risen for a number of reasons in recent years: the Great Recession (with its associated job instability), automation and the fear of job loss, the Chinese import shock, and ageing populations and migration, amongst others. As well as its obvious implications for family finances […]

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    Eurosceptic votes are less likely when EU interventions visibly boost local job markets

Eurosceptic votes are less likely when EU interventions visibly boost local job markets

Anti-systemic political movements have emerged in recent years in a large number of countries across the globe. These parties generally fuel their public support with anti-elite and anti-establishment rhetoric, which in Europe often translates into a strong critique to the European Union and its institutions. The EU is regarded by the supporters of anti-system movements as distant from the […]