Results

CEP occasional paper

CEP wellbeing coefficient database

Wellbeing cost-benefit analysis requires credible estimates of how much specific life circumstances change subjective wellbeing. This paper documents and contextualises a compendium of 123 such estimates, drawn from 19 d...Read more...

Blog

Bloomberg Trumponomics (podcast):

Are We Being Priced Out of Happiness?

Americans are spending less time with friends, nights out are getting more expensive and even major sporting events are becoming harder to afford. Stephanie Flanders speaks with Bloomberg reporter Ben Steverman and econo...Read more...

Journal article

The Economic Journal:

Manipulation and selection in unemployment insurance

In this paper, we study the selection patterns of individuals who manage to have their lay-off delayed around an age at lay-off threshold entitling them to four additional months of unemployment insurance, that is, manip...Read more...

Journal article

Social Science & Medicine:

Passing on the flame: Do mega sports events promote health behaviours?

To justify billion-dollar public expenditures on mega sports events, proponents often suggest lasting improvements in health behaviours among the general public. To estimate the returns to health behaviours from hosting ...Read more...

Journal article

Psychological Medicine :

Cost-benefit of IAPT Norway and effects on work-related outcomes and health care utilization: results from a randomized controlled trial using registry-based data

Data from an RCT of IAPT Norway (?Prompt Mental Health Care? [PMHC]) were linked to several administrative registers up to five years following the intervention. The aims were to (1) examine the effects of PMHC compared ...Read more...

Chapter

WELLBY

in Elgar Encyclopedia of Behavioural and Experimental Economics

The WELLBY is a measure of individual subjective wellbeing, as judged by individuals themselves, capturing both the quality of life and the length of life. We outline its use for measuring social progress and for social ...Read more...

CEP discussion paper

Highway traffic in Britain: the effect of road capacity changes

This paper examines the effects of road capacity expansion on traffic volumes, population, and employment in Great Britain between 2001 and 2020, using annual data for 218 Travel-to-Work Areas and an instrumental-variabl...Read more...

CEP occasional paper

The Lower Thames crossing

Being on the move can spiral our mood up or down. There is well-known evidence that walking and cycling can directly improve our mental health as well as our physical health; many of us have experienced feelings of freed...Read more...

CEP discussion paper

Talking therapy: Impacts of a nationwide mental health service in England

Mental health problems impose significant costs, yet healthcare systems of-ten overlook them. We provide the first causal evidence on the effectiveness of a nationwide-scaled mental health service in England for treating...Read more...

CentrePiece article

How much is your time worth?

Wages indicate how much people want for their time at work, but how can we find out what value they place on time spent doing other things? Christian Krekel and George MacKerron analyse over two million responses to a sm...Read more...

CEP discussion paper

Estimating the longevity of electric vehicles: what do 300 million MOT test results tell us?

Knowing how long the average vehicle remains roadworthy before being scrapped is a crucial input into life cycle assessment (LCA) and total cost of ownership (TCO) studies of different vehicle powertrains. This study lev...Read more...

Journal article

The Review of Economic Studies:

A theory of falling growth and rising rents

Growth has fallen in the U.S. amid a rise in firm concentration. Market share has shifted to low labour share firms, while within-firm labour shares have actually risen. We propose a theory linking these trends in which ...Read more...

CEP Covid-19 analysis

The self-employment trap?

The seventh LSE-CEP survey of the self-employed was undertaken in June 2023. The results revealed that the self-employed are still in the doldrums and their incomes and activity have not resumed to pre-pandemic levels. T...Read more...

Journal article

The Economic Journal:

Unraveling firms: demand, productivity and markups heterogeneity

We develop a novel framework that simultaneously allows recovering heterogeneity in demand, quantity TFP and markups across firms while leaving the correlation between the three dimensions unrestricted. We accomplish thi...Read more...

CEP discussion paper

Back to Edgeworth? Estimating the value of time using hedonic experiences

Following early economist Francis Y. Edgeworth's proposal to measure people's hedonic experiences as they go about their daily lives, we use a smartphone app that surveyed a panel of 30; 928 individuals UK-wide over seve...Read more...

Blog

What Works Centre for Local Economic Growth:

Stepping up evaluation of active travel

Will Brett Harding discusses increasing active travel and what this means for locally delivered projects, and more generally about plans for determining the benefits of active travel investments....Read more...

CentrePiece article

Why have energy bills been rising?

The UK has been particularly exposed to the global energy crisis - partly due to the country's dependence on gas for heating and electricity generation, and partly its poorly insulated housing stock. After predictions th...Read more...

CEP Covid-19 analysis

From Covid-19 to collapse? The self-employed and the cost of living crisis

The sixth LSE-CEP survey of the self-employed was undertaken in November 2022 and found that the downward trend in income levels of the self-employed reported in May 2022 has continued. The cost of living crisis is hitti...Read more...

CEP discussion paper

Non-tariff barriers and consumer prices: evidence from Brexit

Non-Tariff Barriers (NTBs) are the main policy impediment to international trade, yet little is known about their pass-through to prices. This paper exploits the Brexit trade policy shock to quantify how NTBs affect cons...Read more...

Journal article

Ecological Economics:

The environmental cost of the international job market for economists

We provide an estimate of the environmental impact of the recruitment system in the economics profession, known as the "international job market for economists". Each year, most graduating PhDs seeking jobs in academia, ...Read more...

Blog

LSE British Politics and Policy :

Why have energy bills in the UK been rising?

The UK is particularly exposed to the energy crisis sweeping across the world. After predictions that annual household bills were due to rise from around #1,000 to #3,500 in October 2022, the government announced it woul...Read more...

CentrePiece article

Environmental costs of the global job market for economists

Each year, the international job market for economists involves more than 1,000 candidates and several hundred recruiters from around the world meeting for short pre-screening interviews at annual congresses in Europe an...Read more...

Blog

Economics Observatory:

Is inflation avoidable?

Inflation in the UK is at a 40 year high, with prices rising across the economy. Shoppers can look for cheaper products, but many are already buying the lowest-cost options and the prices of those bargains are going up f...Read more...

Blog

Economics Observatory:

Are wages keeping up with the cost of living?

There is currently much debate about whether pay should keep pace with either productivity or inflation. How we measure price growth has a big influence on what we observe, shedding light on how different parts of the ec...Read more...

Blog

Vox EU:

The economics of Brexit: a new eBook

What has Brexit meant for the UK economy? Six years on from the referendum, and over a year since the implementation of the UK-EU Trade and Cooperation Agreement, this column introduces a new eBook which brings together ...Read more...

Journal article

Review of Economics and Statistics:

The impact of contract enforcement costs on value chains and aggregate productivity

I study how supplier contracting frictions shape the patterns of intermediate input use and quantify the impact of these distortions on aggregate productivity. Using the frequency of litigation between US firms as a nove...Read more...

CEP discussion paper

The environmental cost of the international job market for economists

We provide an estimate of the environmental impact of the recruitment system in the economics profession, known as the "international job market for economists". Each year, most graduating PhDs seeking jobs in academia, ...Read more...

Journal article

International Journal of Health Planning and Management:

Medical disputes and patient satisfaction in China: how does hospital management matter?

Objective: Satisfaction with healthcare may be captured by surveys of patients and staff, or in extreme cases, the number and severity of medical disputes. This study tries to investigate the relationship between satisfa...Read more...

Journal article

Journal of the European Economic Association:

Parents, schools and human capital differences across countries

This paper studies the contribution of parental influence in accounting for cross-country gaps in human capital achievements. We argue that the cross-country variation in unobserved parental characteristics is at least a...Read more...

Journal article

The Economic Journal:

Trapped factors and China?s impact on global growth

After a recent increase in Chinese import competition, European firms increased innovation. We present and rationalise these patterns using `trapped factors? at the micro level within a stylised equilibrium model of prod...Read more...

CEP occasional paper

Regional differences in UK transport BCRs: an empirical assessment

The UK government uses a Value for Money (VfM) framework to help allocate infrastructure expenditure. At the core of this framework is a benefit to cost ratio (BCR) that is calculated using a set of established monetised...Read more...

Journal article

Oxford Review of Economic Policy:

What is the meaning of (statistical) life? Benefit-cost analysis in the time of Covid-19

Efforts to support public policy decisions need to be conducted carefully and thoughtfully. Recent efforts to estimate the social benefits of reductions in mortality risks associated with COVID-19 interventions are likel...Read more...

CEP occasional paper

When to release the lockdown: a wellbeing framework for analysing costs and benefits

In choosing when to end the lockdown, policy-makers have to balance the impact of the decision upon incomes, unemployment, mental health, public confidence and many other factors, as well as (of course) upon the number o...Read more...

Journal article

The Economic Journal:

Merger policy in a quantitative model of international trade

In a two-country international trade model with oligopolistic competition, we study the conditions on market structure and trade costs under which a merger policy designed to benefit domestic consumers is either too toug...Read more...

Journal article

Economics of Transportation:

Quantifying wider economic impacts of agglomeration for transport appraisal: existing evidence and future directions

The Authors This paper is concerned with the Wider Economic Impacts (WEIs) of transport improvements that arise via scale economies of agglomeration. It reviews the background theory and empirical evidence on agglomerati...Read more...

Journal article

IZA Journal of Labor Economics:

Reallocation and the role of firm composition effects on aggregate wage dynamics

Aggregate wages display little cyclicality compared to what a standard model would predict. Wage rigidities are an obvious candidate, but the existing literature has emphasized the need to take into account the growing i...Read more...

Journal article

The Economic Journal:

The time value of housing: historical evidence on discount rates

Most London housing transactions involve trading long leases of varying lengths. We exploit this to estimate the time value of housing ? the relationship between the price of a property and the term of ownership ? over a...Read more...

CEP discussion paper

Quantifying wider economic impacts of agglomeration for transport appraisal: existing evidence and future directions

This paper is concerned with the Wider Economic Impacts (WEIs) of transport improvements that arise via scale economies of agglomeration. It reviews the background theory and empirical evidence on agglomeration, explains...Read more...

Journal article

Journal of Economic Behavior and Organization:

Identity, non-take-up and welfare conditionality

We study a model in which poor individuals of different types request a service and may suffer from the discrepancy between the service provider's beliefs and their true type. The utility loss resulting from such a discr...Read more...

Journal article

American Economic Review:

Is modern technology responsible for jobless recoveries?

Since the early 1990s, recoveries from recessions in the US have been plagued by weak employment growth. We investigate whether a similar problem afflicts other developed economies, and whether technology is a culprit. W...Read more...

CEP discussion paper

Aggregate recruiting intensity

We develop a model of firm dynamics with random search in the labor market where hiring firms exert recruiting effort by spending resources to fill vacancies faster. Consistent with micro evidence, in the model fast-grow...Read more...

Journal article

American Journal of Medical Research:

Why we should spend more on mental health

Mental health problems affect roughly 1 in 5 adults, and 1 in 10 children at any one time. In rich countries they cause roughly 40% of disability, absenteeism and underperformance at work, and cost some 7% of GDP. Under ...Read more...

CEP discussion paper

The impact of contract enforcement costs on outsourcing and aggregate productivity

Legal institutions affect economic outcomes, but how much? This paper documents how costly supplier contract enforcement shapes firm boundaries, and quantifies the impact of this transaction cost on aggregate productivit...Read more...

Journal article

Frontiers in Psychology:

Why more psychological therapy would cost nothing

To tackle the huge problem of mental illness, England has launched a large programme of psychological therapy, which is being watched worldwide. The authors argue that it costs nothing, due to savings on welfare benefits...Read more...

Blog

LSE European Politics and Policy Blog:

Leaving the European Union would likely have a significant negative impact on the UK?s economy

How would leaving the EU affect the UK's economy? Gianmarco Ottaviano, Joao Paulo Pessoa, Thomas Sampson and John Van Reenen outline findings from a new report on the economic consequences of a Brexit. They indicate that...Read more...

CentrePiece article

Lessons from the economics of crime

Olivier Marie explains the value of an economic approach to the analysis, design and evaluation of crime-fighting policies....Read more...

Journal article

American Economic Review:

Market size, competition, and the product mix of exporters

We build a theoretical model of multi-product firms that highlights how competition across market destinations affects both a firm's exported product range and product mix. We show how tougher competition in an export ma...Read more...

Book

Lessons from the Economics of Crime
What Reduces Offending?

Research from the United States, Europe, and South America demonstrates the usefulness of the tools of economic analysis for the study of crime. Economists who bring the tools of economic analysis to bear on the stu...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Do Long Distance Moves Discourage Homeownership? Evidence from England

We hypothesize that as the distance of a residential move increases, the cost of collecting information on the destination housing market rises, the amount and quality of information collected fall, and the chances of ma...Read more...

CEP discussion paper

The objective benefits of subjective well-being

The aim of this paper is to survey the 'hard' evidence on the effects of subjective well-being. In doing so, we complement the evidence on the determinants of well-being by showing that human well-being also affects outc...Read more...

CEP discussion paper

A model of aggregate demand and unemployment

We present a static model of aggregate demand and unemployment. The economy has a nonproduced good, a produced good, and labor. Product and labor markets have matching frictions. A general equilibrium is a set of prices,...Read more...

CEP discussion paper

A general method for valuing non-market goods using wellbeing data: three-stage wellbeing valuation

Subjective wellbeing data is becoming increasingly popular in economics research. The wellbeing valuation approach uses wellbeing data instead of data gleaned from preferences to attach monetary values to non-market good...Read more...

SERC/Urban and Spatial Programme Discussion Paper

External Benefits of Brownfield Redevelopment: An Applied Urban General Equilbirum Analysis

Does brownfield redevelopment warrant government support? We explore several external benefits in an urban general equilibrium framework. Preferences are modelled such that demand for housing units in the city is downwar...Read more...

CEP discussion paper

International Trade Without CES: Estimating Translog Gravity

This paper derives a micro-founded gravity equation in general equilibrium based on a translog demand system that allows for endogenous markups and substitution patterns across goods. In contrast to standard CES-based gr...Read more...

CEP discussion paper

Recovering the Sunk Costs of R&D: the Moulds Industry Case

Sunk costs for R&D are an important determinant of the level of innovation in the economy. In this paper I recover them using a Markov equilibrium framework. The contribution is twofold. First, a model of industry dynami...Read more...

CEP discussion paper

How to Measure Living Standards and Productivity

This paper sets out a general algorithm for calculating true cost-of-living indices or true producer price indices when demand is not homothetic, i.e. when not all expenditure elasticities are equal to one. In principle,...Read more...

CEP discussion paper

Improving Access to Psychological Therapy: Initial Evaluation of the Two Demonstration Sites

The Government's Improving Access to Psychological Therapy (IAPT) programme aims to implement NICE Guidance for people with depression and anxiety disorders. In the first phase of the programme, two demonstration sites w...Read more...

CEP discussion paper

Competing for Contacts: Network Competition, Trade Intermediation and Fragmented Duopoly

A two-sided, pair-wise matching model is developed to analyse the strategic interaction between two information intermediaries who compete in commission rates and network size, giving rise to a fragmented duopoly market ...Read more...

CEP discussion paper

Information Costs, Networks and Intermediation in International Trade

This paper presents a pairwise matching model with two-sided information asymmetry to analyse the impact of information costs on endogenous network building and matching by information intermediaries. The framework innov...Read more...

CEP discussion paper

Cost-Benefit Analysis of Psychological Therapy

At present six million people are suffering from clinical depression or anxiety disorders, but only a quarter of them are in treatment. NICE Guidelines prescribe the offer of evidence-based psychological therapy, but the...Read more...

CEP discussion paper

Measuring Organization Capital in Japan: An Empirical Assessment Using Firm-Level Data

Globalization and the ICT revolution of the 1990s have forced many firms to reorganize in order to survive in a more competitive market. There are several approaches that can be used to assess the measurement of organiza...Read more...

CEP discussion paper

Chain Indices of the Cost of Living and the Path-Dependence Problem: An Empirical Solution

This paper proposes an empirically feasible method for correcting the path-dependence bias of chain indices of the cost of living. Chain indices are discrete approximations to Divisia indices and it is well known that th...Read more...

CEP discussion paper

Agricultural Returns and Conflict: Quasi-Experimental Evidence from a Policy Intervention Programme in Rwanda

In 1997 Rwanda introduced a re-settlement policy for refugees displaced during previous conflicts. We exploit geographic variation in the speed of implementation of this policy to investigate the impact of conflict-induc...Read more...

CEP discussion paper

Superstars and Renaissance Men: Specialization, Market Size and the Income Distribution

A general equilibrium model of individual specialization is presented in which agents trade off the productivity and price implications of producing a narrower range of goods. Agents with highly specific skills turn out ...Read more...

CEP discussion paper

Ex Post Versus Ex Ante Measures of the User Cost of Capital

When doing growth accounting, should we use ex post or ex ante measures of user costs to calculate the contribution of capital? The answer, based on a simple model of temporary equilibrium, is that ex post is better in t...Read more...

CEP discussion paper

Crime and Police Resources: The Street Crime Initiative

In this paper we look at links between police resources and crime in a different way to the existing economics of crime work. To do so we focus on a policy intervention - the Street Crime Initiative - that was introduced...Read more...

CEP discussion paper

Why Do Voice Regimes Differ?

In this paper we seek to explain the emergence of different voice regimes, and to do so by using approaches from institutional economics. In particular we analyse the emergence of different voice regimes as a contracting...Read more...

CEP discussion paper

Scale Effects in Markets with Search

Reduced-form tests of scale effects in markets with search, run when aggregate matching functions are estimated, may miss important scale effects at the micro level, because of the reactions of job searchers. A semi-stru...Read more...