Question 1: What is the primary factor driving regional productivity disparities in the UK?
Answer:
Sorting
Confidence level:
Confident
Comment:
Regional productivity disparities in the UK is all about London and the SE versus the rest. Agglomeration efects are present in all regions. But history explains the power of London to attract highly-skilled individals to move there to set up new firms and industries. A recent example is AI and fintech in the Shoreditch and Kings Cross areas.
Question 3: Relative to tax plans at the beginning of the year, the UK government should respond by:
Answer:
Cutting tax intake
Confidence level:
Confident
Comment:
The additional supply shock generated by the Russian invasion of Ukraine should be combated by tighter monetary policy coupled with looser fiscal policy.
Question 2: Relative to the public spending plans at the beginning of the year, the UK government should respond by:
Answer:
Increasing public spending in real terms
Confidence level:
Confident
Question 1: Relative to the Bank of England’s planned trajectory for interest rates at the beginning of the year, the Bank should respond to geopolitical events by:
Question 2: What is your evaluation of the following statement: “A well-designed government-stipulated wage increase can lead to higher productivity”?
Answer:
Strongly agree
Confidence level:
Very confident
Comment:
Restricting immigration, particularly of the low skilled, is one way to raise both wages and productivity. Firstly, economic theory (the Solow model) suggests that the level of wages will be higher, the slower the growth rate of the labour force. Reducing immigration will lower the growth rate of the labour force. The reason is that slower growth of labour increases the long run capital-labour ratio, leading to higher wages and productivity.
Secondly, as a matter of fact since 2007 faster growth of labour has been associated with slower growth of productivity in the Western world. Though this cannot be expected to be true at all times and places (the Solow model predicts no association in the long run), I have argued that since the global financial crisis foreign demand for exports from countries like the UK has been constrained. So our higher growth rate of labour explains our poor productivity performance, relative to countries which by one means or another control immigration.
In other words, reducing immigration can raise both the level and growth rate of productivity, and so raise the level and growth rate of wages.
The CFM surveys informs the public about the views held by prominent economists based in Europe on important macroeconomic and public policy questions. Some surveys focus specifically on the UK economy (as the CFM is a UK research centre), but surveys can in principle focus on any macroeconomic question for any region. The surveys shed light on the extent to which there is agreement or disagreement among these experts. An important motivation for the survey is to give a more comprehensive overview of the beliefs held by economists and in particular to include the views of those economists whose opinions are not frequently heard in public debates.
Questions mainly focus on macroeconomic and public policy topics. Although there are some questions that focus specifically on the UK economy, the setup of the survey is much broader and considers questions related to other countries/regions and also considers questions not tied to a specific economy.
The surveys are done in collaboration with the Centre for Economic Policy Research (CEPR).
Levelling Up Productivity Gaps in the UK
Question 1: What is the primary factor driving regional productivity disparities in the UK?
The Impact of the Russian Invasion of Ukraine on the UK Economy
Question 3: Relative to tax plans at the beginning of the year, the UK government should respond by:
Question 2: Relative to the public spending plans at the beginning of the year, the UK government should respond by:
Question 1: Relative to the Bank of England’s planned trajectory for interest rates at the beginning of the year, the Bank should respond to geopolitical events by:
Towards a High-Wage, High-Productivity Economy
Question 2: What is your evaluation of the following statement: “A well-designed government-stipulated wage increase can lead to higher productivity”?
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