Results

CEP discussion paper

Firm-level technology adoption in times of crisis

We investigate the diffusion of frontier technologies across German firms before and during the Covid-19 crisis. Our analysis tracks the nature, timing, and pandemic-related motivations behind technology investments, usi...Read more...

Blog

Bank Underground:

Forbearance lending as a crisis management tool

The Bank of England Agenda for Research (BEAR) sets the key areas for new research at the Bank over the coming years. This post is an example of issues considered under the Prudential Architecture Theme which focuses on ...Read more...

Blog

The Conversation:

Why building new towns isn't the answer to the UK's housing crisis

The UK's new government is intent on building 1.5 million homes over the next five years. It's all part of the plan to address the housing supply and affordability crisis. Many of these homes are to be built in the form...Read more...

Journal article

Journal of Business Venturing:

A framework for investigating new firm entry: The (limited) overlap between informal-formal and necessity-opportunity entrepreneurship

We analyse entrepreneurial entry along the dimensions of informal-formal and necessity-opportunity entrepreneurship, distinguishing between them yet considering them jointly. While the dominant view in the literature con...Read more...

Journal article

PLoS ONE :

Access to digital finance: Equity crowdfunding across countries and platforms

Financing entrepreneurship spurs innovation and economic growth. Digital financial platforms that crowdfund equity for entrepreneurs have emerged globally, yet they remain poorly understood. We model equity crowdfunding ...Read more...

Journal article

Labour Economics:

The effect of preserving job matches during a crisis

It is generally difficult to measure the importance of preserving worker-firm relationships, particularly for low-wage jobs that involve general skills. The COVID-19 pandemic led to the sudden and seemingly temporary dis...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...

Blog

LSE IQ:

How can we make homes more affordable? (Podcast)

In this LSE IQ episode on how we can make homes more affordable, Christian Hilber shares the reasons behind the UK's current housing affordability crisis, explaining the obstacles to building more houses as a way of over...Read more...

Journal article

International Review of Economics and Finance :

Bank default risk propagation along supply chains: evidence from the UK

How does banks' default risk affect the probability of default of non-financial businesses? The literature has focused on the banks' direct corporate customers. It fails to consider the role of supply chain relationships...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...

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

Vox EU:

Financial crises as drivers of populism: a new channel

Financial crises have severe economic costs. This column shows that they also entail major political costs. It argues that the global financial crisis, and associated Great Recession, represents a watershed for populism ...Read more...

CEP discussion paper

Firms and inequality

In the last few decades, dramatic changes have been documented in the US business landscape. These include rising productivity and pay dispersion between firms, higher aggregate markups (of price over variable costs), gr...Read more...

CEP discussion paper

Unequal learning and labour market losses in the crisis: consequences for social mobility

The unequal learning and labour market losses arising in the UK due to the Covid-19 pandemic are used to assess the consequences for social mobility. Labour market and learning losses have been more pronounced for people...Read more...

CEP discussion paper

Bank default risk propagation along supply chains: evidence from the UK

How does banks’ default risk affect the probability of default of non-financial businesses? The literature has addressed this question by focusing on the direct effects on the banks’ corporate customers – demonstrating t...Read more...

CEP election analysis

Housing

Housing affordability is a key concern of an ever-larger fraction of UK voters who are crammed into artificially limited space. It also underlies the sense of being shut out of prosperity and unable to escape declining l...Read more...

CEP discussion paper

Specialization in bank lending: evidence from exporting firms

We develop an empirical approach for identifying specialization in bank lending using granular data on borrower activities. We illustrate the approach by characterizing bank specialization by export market, combining ban...Read more...

Journal article

The Review of Economics and Statistics:

Survive another day: Using changes in the composition of investments to measure the cost of credit constraints

We introduce a novel empirical strategy to measure the size of credit shocks. Theoretically, we show that credit shocks reduce the value of long-term relative to short-term investments. Empirically, we can therefore comp...Read more...

Journal article

American Economic Review:

The sovereign-bank diabolic loop and esbies

We propose a simple model of the sovereign-bank diabolic loop, and establish four results. First, the diabolic loop can be avoided by restricting banks' domestic sovereign exposures relative to their equity. Second, equi...Read more...

CEP discussion paper

The sovereign-bank diabolic loop and ESBies

We propose a simple model of the sovereign-bank diabolic loop, and establish four results. First, the diabolic loop can be avoided by restricting banks domestic sovereign exposures relative to their equity. Second, equit...Read more...

CEP discussion paper

The persistence of a banking crisis

This paper analyses the effects of bank lending on GDP and employment. Following losses on international financial markets in 2008/09, a large German bank cut its lending to the German economy. I exploit variation in dep...Read more...

CEP occasional paper

Medium and long run prospects for UK growth in the aftermath of the financial crisis

The productivity performance of the UK economy in the period 1990-2007 was excellent. Based entirely on pre-crisis data, and using a two-sector growth model, I project the future growth rate of GDP per hour in the market...Read more...

CEP discussion paper

Survive Another Day: Using Changes in the Composition of Investments to Measure the Cost of Credit Constraints

We introduce a novel empirical strategy to measure credit shocks. Theoretically, we show that credit shocks reduce the value of long term investments relative to short term ones. Under the (conservative) assumption that ...Read more...

CEP discussion paper

Long and Short-Term Effects of the Financial Crisis on Labour Productivity, Capital and Output

The behaviour of labour productivity in the United Kingdom since the onset of the recession in early 2008 constitutes a puzzle. Over four years after the recession began labour productivity is still below its previous pe...Read more...

CEP occasional paper

Has the growth of real GDP in the UK been overstated because of mis-measurement of banking output?

If official figures overstated the growth of banking output in the UK in the recent boom, does this mean that GDP growth was overstated too? The answer is no. It is truer to say that if banking output was overstated then...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Causal Effect of Credit Guarantees for SMEs: Evidence from Italy

We evaluate the effectiveness of a partial credit guarantee program implemented in a large Italian region using unique microdata from a broad set of firms. Our results show that the policy was effective to the extent tha...Read more...

CEP US election analysis

Inequality and opportunity: the return of a neglected debate

During this election period many Americans are feeling angry towards the very rich, especially those working in the financial sector, who helped cause the Great Recession and yet were bailed out by the government. Increa...Read more...

CentrePiece article

The doomsday cycle turns: who's next?

Peter Boone and Simon Johnson believe that there are more and worse financial crises to come....Read more...

CEP report

Fiscal consolidation during a depression

In 2009-10, the UK's budget deficit was about 11 per cent of GDP. A credible plan for fiscal consolidation was introduced in the UK over the fiscal years 2011-12 to 2016-17. In this paper, we assess the impact of the sca...Read more...

CEP report

The political economy of the Greek debt crisis: a tale of two bailouts

We review the events that led to the May 2010 and July 2011 bailout agreements. We interpret the bailouts as outcomes of political-economy equilibria. We argue that the second bailout was not on the Pareto frontier and s...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Bank Location and Financial Liberalization Reforms: Evidence from Microgeographic Data

We examine the effects of bank deregulation on the spatial dynamics of retail-bank branching, exploiting, much like a quasi-natural experiment, the context of intense liberalization reforms in Belgium in the late ninetie...Read more...

CEP discussion paper

Trade Crisis? What Trade Crisis?

We provide an analysis of the 2008-2009 trade collapse using microdata from a small open economy, Belgium. First, we find that changes in firm-country-product exports and imports occurred mostly at the intensive margin: ...Read more...

CEP discussion paper

Crisis? What Crisis? Currency vs. Banking in the Financial Crisis of 1931

This paper examines the role of currency and banking in the German financial crisis of 1931 for both Germany and the U.S. We specify a structural dynamic factor model to identify financial and monetary factors separately...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Housing Markets and the Financial Crisis of 2007-2009: Lessons for the Future

An unsustainable weakening of credit standards induced a US mortgage and housing bubble whose consumption impact was amplified by innovations altering the collateral role of housing. In countries with more stable credit ...Read more...

CEP discussion paper

Publicity of Debate and the Incentive to Dissent: Evidence from the US Federal Reserve

When central banks are transparent about their decision making, there may be clear benefits in terms of credibility, policy effectiveness, and improved democratic accountability. While recent literature has focused on al...Read more...

CEP discussion paper

Regional Influences on U.S. Monetary Policy: Some Implications for Europe

This paper looks at the monetary policy decisions of the U.S. Federal Reserve and asks whether those decisions have been influenced solely by national concerns, or whether regional factors have played a role. All of the ...Read more...