Results

Journal article

American Economic Journal: Economic Policy:

Sweeping up gangs: the effects of tough-on-crime policies from a network approach

Globally, gang proliferation is fought primarily through sweeps. This paper uses a difference-in-differences strategy to examine their causal impact on crime for arrested individuals and their peers. Analysis focuses on ...Read more...

CEP report

Road to recovery: Self-employed on the mend?

The eighth LSE-CEP survey of the self-employed shows weekly hours of the self-employed are now seeing some signs of recovery, compared with the last data collection in June 2023. The positive increase in work hours is tr...Read more...

Journal article

Oxford Research Encyclopedia of Economics and Finance:

Returns to adult learning

A common starting point in understanding investments in learning is that people participate in education when the life-cycle returns to education outweigh its costs. Since people will reap the higher wages associated wit...Read more...

CEP discussion paper

Minimum wages and low wage workers: compliance as non-employment margin

This paper examines the impact of a substantial minimum wage increase in Uruguay - a middle-income developing economy - on wages and employment. Using administrative data and a difference-in-differences approach, we anal...Read more...

Blog

Promarket:

Does Domestic Competition Help EU Firms Compete Abroad?

In a survey of nearly 400 European firms that export abroad, Elena Argentesi, Livia De Simone, Stephan Paetz, Vincenzo Scrutinio find that most firms believe that competition forces them to produce cheaper and higher qua...Read more...

Blog

Vox EU:

Closing the health gap: How chronic illness drives health inequality early on

Though health disparities have long been the subject of research and debate, life expectancy gaps between rich and poor remain striking, even in countries with universal access to healthcare. This column analyses the roo...Read more...

Journal article

Critical Sociology:

A popular backlash against globalization?

Is there a popular backlash against globalization? When did it start and in which forms? What do we know about its causes? We address these questions in the context of advanced democracies. We see the `globalization back...Read more...

Journal article

The Economic Journal:

Commuting for crime

People care about crime, with the spatial distribution of both actual and perceived crime affecting the amenities from living in different areas and residential decisions. The literature finds that crime tends to happen ...Read more...

Journal article

Research in Labor Economics:

Effort at work and worker well-being

This chapter analyzes detailed 24-hour diary data from the United States to provide evidence on the relationship between workers? effort and well-being while at work. In doing so, we first measure workers? effort in term...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...

CEP discussion paper

The dynamics of the 'Great Gatsby Curve' and a look at the curve during the Great Gatsby era

We use linked historical US censuses to study the empirical relationship between inequality and intergenerational mobility. We first confirm that the 'Great Gatsby Curve' already existed in the early 20th century. We the...Read more...

CEP discussion paper

Dealing with adversity: religiosity or science? Evidence from the great influenza pandemic

How do societies respond to adversity? After a negative shock, separate strands of research document either an increase in religiosity or a boost in innovation efforts. In this paper, we show that both reactions can occu...Read more...

External report

Low pay Britain 2023

After a decade and a half of relative economic decline, Britain needs a new economic strategy. This paper considers what it would mean to put good work centre stage. It requires us to go far beyond the narrow focus this ...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

Vox EU:

Unequal education and the 'Great Gatsby Curve'

In modern economies, people's livelihoods are based in large part on skills acquired through education. Unequal education therefore drives both inequality in the labour market and low social mobility across generations. ...Read more...

Blog

BBC Radio 4:

Understand The Economy: 6. Recessions (podcast)

What is a recession and what causes a recession? Tim Harford explains the role a government can play in pulling a country out of a recession. Richard Davies is a guest speaker in this episode....Read more...

CEP Covid-19 analysis

Covid-19 and the self-employed - A two year update

The fifth LSE-CEP survey of the self-employed of May 2022 provides an up to date picture of how Covid-19 and its aftermath keep affecting the self-employed. The findings show that, although working on average a little mo...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 Covid-19 analysis

Covid-19 and the self-employed - 18 months into the crisis

A year and a half into the Covid-19 pandemic, growth and economic recovery are the latest watchwords amongst labour market commentators in the UK. In this report we continue to monitor the situation of the self-employed ...Read more...

CEP discussion paper

This time is not so different: income dynamics during the Covid-19 recession

We use a UK employer-employee administrative earnings dataset to investigate the response of earnings and hours to business cycles. Exploiting our long panel of data from 1975 to 2020 we find wide heterogeneity in the ex...Read more...

CEP Covid-19 analysis

Covid-19 and the self-employed - ten months into the crisis

Almost a year into the Covid-19 crisis, it has become widely acknowledged that UK self-employment has been particularly hard hit. Here we continue our series investigating the experience of self-employed workers througho...Read more...

Journal article

American Economic Journal: Applied Economics:

Turbulence, firm decentralization, and growth in bad times

What is the optimal form of firm organization during ?bad times?? The greater turbulence following macro shocks may benefit decentralized firms because the value of local information increases (the ?localist? view). On t...Read more...

CEP discussion paper

The UK's great demand and supply recession

We revisit UK?s poor productivity performance since the Great Recession by means of both a suitable theoretical framework and firm-level prices and quantities data for detailed products allowing us to both measure demand...Read more...

CEP Covid-19 analysis

Covid-19 and the self-employed: six months into the crisis

Six months after Covid-19 first hit, it is clear that it is the greatest economic crisis of the modern age. The economy has contracted far more rapidly than in previous crises, with GDP dropping by a record 19.5 per cent...Read more...

CEP discussion paper

The social determinants of choice quality: evidence from health insurance in the Netherlands

Market provision of impure public goods such as insurance, retirement savings and education is common and growing as policy makers seek to offer more choice and gain efficiencies. This approach induces an important trade...Read more...

Blog

The State of Working Britain:

UK labour market under Covid part 3: layoffs, hiring & wages

Recessions, usually signify a rise in layoffs. Even the last recession, which was accompanied by much more wage moderation than previous ones, generated a significant rise in redundancies. This time it is a little differ...Read more...

Journal article

SERIEs:

Job loss at home: children's school performance during the Great Recession

This paper studies the intergenerational impact of parental job loss on school performance during the Great Recession in Spain. Collecting data through parental surveys in a school in the province of Barcelona, I obtain ...Read more...

CEP Covid-19 analysis

Self-employment in the Covid-19 crisis

The Covid-19 shock is one of the largest economic shocks that has taken place in living memory. The crisis has served to highlight the challenges governments face in extending social insurance to self-employed workers, f...Read more...

Blog

VoxEU:

Measuring the impact of malfunctioning credit markets on productivity

Since the Global Crisis, there has been a renewed awareness of how frictions in credit markets can damage economic efficiency due to a higher cost of capital and/or capital being misallocated away from its most productiv...Read more...

CEP industrial strategy paper

Has the Financial Crisis Undermined Credit Reallocation in the United Kingdom?

The global financial crisis and its aftermath heightened awareness of the role of credit frictions in affecting aggregate economic performance. An important question is whether capital is being allocated to its most prod...Read more...

Journal article

China and World Economy:

Fiscal subsidy policy on home appliances: its effects on domestic consumption and exports in China

This paper evaluates the effects of the Home Appliances Going to the Countryside (HAGC) policy, a fiscal subsidy program implemented in China to boost private consumption of home appliances in rural areas from 2007 to 20...Read more...

Journal article

The Review of Economic Studies:

The changing returns to crime: do criminals respond to prices?

To what extent does crime follow the pattern of potential gains to illegal activity? This article presents evidence on how criminals respond to this key incentive by reporting crime-price elasticities estimated from a co...Read more...

Journal article

Fiscal Studies:

The economic effects of Brexit: evidence from the stock market

We study stock market reactions to the Brexit referendum on 23 June 2016 in order to assess investorsi?? expectations about the effects of leaving theEuropean Union on the UK economy. Our results suggest that initial sto...Read more...

CEP discussion paper

The economic effects of Brexit - evidence from the stock market

We study stock market reactions to the Brexit referendum on 23 June 2016 in order to assess investors? expectations about the effects of leaving the European Union on the UK economy. Our results suggest that initial stoc...Read more...

Journal article

Review of Economics and Statistics:

Crime scars: recessions and the making of career criminals

Recessions lead to short-term job loss, lower levels of happiness and decreasing income levels. There is growing evidence that workers who first join the labour market during economic downturns suffer from poor job match...Read more...

CEP discussion paper

Turbulence, firm decentralization and growth in bad times

What is the optimal form of firm organization during 'bad times'? The greater turbulence following macro shocks may benefit decentralized firms because the value of local information increases (the 'localist' view). On t...Read more...

Journal article

IZA Journal of Labor & Development:

Pathways from school to work in the developing world

This paper uses novel micro data from the ILO-STWT surveys to provide evidence on the duration, endpoint, and determinants of the transition from school to work in a sample of 23 low- and middle-income countries around t...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Austerity States, Institutional Dismantling and the Governance of Sub-National Economic Development: The Demise of the Regional Development Agencies in England

Contributing to interpretations of the governance geographies of austerity, the paper explains how, why and in what forms austerity states are constructed by actors in particular political-economic contexts and geographi...Read more...

Journal article

Regional Science and Urban Economics:

Local agglomeration, entrepreneurship and the 2008 recession: evidence from Italian industrial districts

We investigate whether the impact of recessions on entrepreneurship is affected by the presence of industrial districts, a source of local agglomeration economies. Using Italian Labour Force quarterly data from 2006 to 2...Read more...

CentrePiece article

In brief... Parental job loss: the impact on children's school performance

Unemployment is bad news not just for the individuals who lose their jobs but also for their families. Jenifer Ruiz-Valenzuela examines this underemphasised cost of economic downturns by measuring the impact of parental ...Read more...

CEP discussion paper

Job loss at home: children's school performance during the great recession in Spain

This paper studies the effect of parental job loss on children's school performance during the Great Recession in Spain, using an original panel dataset for students observed since the beginning of the crisis in a school...Read more...

CEP discussion paper

Informal care and the great recession

Macroeconomic downturns can have both an important impact on the availability of informal care and the affordability of formal long-term care. This paper investigates how the demand for and provision of informal care cha...Read more...

CEP occasional paper

The UK's productivity puzzle

The 2008 Great Recession was notable in the UK for three things: the enormity of the output shock; the muted unemployment response; and the very slow rate of recovery. We review the literature which finds most of the dec...Read more...

Blog

LSE British Politics and Policy:

The NHS: Promises and productivity

In the general election debate about healthcare, all the parties are seeking to portray an NHS protected from major public sector expenditure cuts, with expansion in some areas. But according to Alistair McGuire and John...Read more...

CEP election analysis

The Economic Performance of UK Cities: Can Urban and Regional Policy Make a Difference to the North-South Divide

There are large variations in economic performance across UK cities and on some measures, they have widened since the global financial crisis. All main parties promise action to reduce them, but there is little differenc...Read more...

CEP election analysis

Real Wages and Living Standards

Real wages and living standards have taken a hard hit in the UK in the recent past. Real wages of the typical (median) UK worker have fallen by almost 10% since 2008 and median family incomes have significantly fallen fo...Read more...

CEP election analysis

Productivity and Business Policies

UK productivity stagnated after the Great Recession of 2008-09 and remains about 15 percent below historical trends. This 'productivity puzzle' is due to a mixture of cyclical and structural effects - the fall is not ent...Read more...

CentrePiece article

Napoleonic protectionism: how France's cotton industry gained

Can temporary protection from trade with advanced economies foster the development of `infant industries? in developing countries? Reka Juhasz considers a natural experiment: Napoleon?s wartime blockade of British export...Read more...

CEP discussion paper

Making do with less: working harder during recessions

Why did productivity rise during recent recessions? One possibility is that average worker quality increased. A second is that each incumbent worker produced more. The second effect is termed ?making do with less.? Using...Read more...

CEP discussion paper

The dynamics of employment growth: new evidence from 18 countries

Motivated by the on-going interest of policy makers in the sources of job creation, this paper presents results from a new OECD project on the dynamics of employment (DynEmp) based on an innovative methodology using firm...Read more...

CEP discussion paper

Are firms paying more for performance?

Despite its potential to raise productivity, performance-related-pay (PRP) is not widespread in market-oriented economies. Furthermore, despite secular changes conducive to its take-up, there is mixed evidence as to whet...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

Falling real wages

The researchers note that there have been historically unprecedented falls in UK real wages since the start of the Great Recession. What?s more, the long US experience of stagnant real wages (median real weekly earnings ...Read more...

CentrePiece article

In brief... New technology: who wins, who loses?

Technology has transformed the once powerful office of ambassador into a glorified sales position, while nurses, teaching assistants and medical technicians all benefit from the ICT revolution. According to an empirical ...Read more...

Blog

LSE European Politics and Policy Blog:

The state of the UK economy: Diagnosis, prognosis and recommended treatment

The UK economy has experienced a prolonged period of weakness over the last five years. John Van Reenen writes that the real problems for the UK are inadequate long-run investment in infrastructure, innovation and human ...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...

Journal article

Economica:

Unemployment in the Great Recession

This paper studies the responses of unemployment in Germany, the USA and the UK to the Great Recession of 2008-9 using Beveridge curve analysis, and in the entire OECD using other techniques. It is shown that the UK suff...Read more...

Blog

LSE European Politics and Policy Blog:

UK Spending Review 2013: A triumph of politics over reason?

The UK?s Spending Review has been forced on the British Chancellor because weak economic growth has blown a hole in the deficit reduction programme. John Van Reenen welcomes the partial reversal of the hugely damaging cu...Read more...

CentrePiece article

The economic future of British cities

Henry Overman surveys the evidence on potentially effective responses to the recession and longer-term structural change....Read more...

Blog

LSE European Politics and Policy Blog:

Small isn?t always beautiful: The cost of regulation on French firms

France has a raft of labour-market regulations that kick in for firms with 50 workers or more. Luis Garicano and John Van Reenen use this threshold to identify the economic effects of size-contingent regulations. Such po...Read more...

CEP discussion paper

Pushing on a string: US monetary policy is less powerful in recessions

We estimate the impulse response of key US macro series to the monetary policy shocks identified by Romer and Romer (2004), allowing the response to depend flexibly on the state of the business cycle. We find strong evid...Read more...

CEP discussion paper

Unemployment in the Great Recession

This paper studies the responses of unemployment in Germany, the United States and Britain to the Great Recession of 2008-09 by making use of Beveridge curve analysis, and in the entire OECD with other techniques. It is ...Read more...

Blog

LSE European Politics and Policy Blog:

No Triple Dip does not mean a good recovery for the UK

John Van Reenen reacts to the news this week that the UK has avoided economic contraction in the last quarter. Whilst Osborne may see this as cause to celebrate, there is nothing commendable about an economy that continu...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 US election analysis

Economic Recovery and Policy Uncertainty

Until some political mechanism creates incentives to elect moderate representatives who can reach across the ideological divide, the US seems destined to heightened levels of policy uncertainty for many years to come. So...Read more...

CEP US election analysis

Recession and Recovery: The US Policy Debate on Taxes, Spending and Public Debt

The US economy is still suffering from its most severe recession in seven decades. In the first of a series of US Election Analyses, Ethan Ilzetzki covers the key issue of taxes, spending and public debt, a major point o...Read more...

CEP discussion paper

Brain Drain or Brain Gain? Technology Diffusion and Learning On-the-job

This paper develops a theory of technology transfer when technology is embodied in human capital and learning requires on-the-job communication between managers and workers. Patterns of knowledge diffusion depend on wher...Read more...

CEP discussion paper

The German Transfer Problem, 1920-1933: A Sovereign Debt Perspective

The severity of the Great Depression in Germany has sometimes been blamed on reparations in simplistic fashion. Alternative interpretations relied on American capital exports, the demise of the Gold Standard, or on malfu...Read more...

CEP discussion paper

Reparations, Deficits, and Debt Default: the Great Depression in Germany

Germany?s Great Depression of the early 1930s started in 1929 with a sudden stop in the current account. It ended after a foreign debt default that unfolded in several stages from 1931 to 1933. This chapter reviews Germa...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Great Britain's Second-Order City Regions in Recessions, 1978-2010

While it is now accepted that the 2008-09 recession accentuated regional differences in Britain, it is more difficult to identify the role of major cities, especially over a longer time scale. Using previously establishe...Read more...

CEP report

UK economic performance since 1997: growth, productivity and jobs

A common view is that the performance of the UK economy between 1997 and 2010 under Labour was very weak and that the current economic problems are a consequence of poor policies in this period. In this report, we analys...Read more...

CentrePiece article

Youth unemployment

The rise in joblessness among young people began long before the recession - Barbara Petrongolo and John Van Reenen consider potential explanations....Read more...

SERC/Urban and Spatial Programme Discussion Paper

Where is the Economics in Spatial Econometrics?

Spatial econometrics has been criticized by some economists because some model specifications have been driven by data-analytic considerations rather than having a firm foundation in economic theory. In particular this a...Read more...

Book

The Labour Market in Winter
The State of Working Britain

This collection of essays - by leading economic experts on the UK labour market - provides an overview of the key issues concerning the performance of the labour market, and the policy issues surrounding it, with a f...Read more...

CEP discussion paper

The Evolution of the Modern Worker: Attitudes to Work

This paper examines how employees? experiences of, and attitudes towards, work have changed over the last quarter of a century. It assesses the extent to which any developments relate to the economic cycle and to trends ...Read more...

Blog

LSE British Politics and Policy:

Academy schools under Labour combated disadvantage and increased pupil achievement: the coalition?s new policy may exacerbate existing inequalities

With the recent accusation that Michael Gove has been sending `mixed messages? over academy schools, it is clear that the policy is still very controversial. Stephen Machin and James Vernoit take a step back and compar...Read more...

Blog

LSE British Politics and Policy:

LSE Centre for Economic Performance ? A Note on Academy School Policy

The Academies programme3 was first introduced by the Labour government in September 2002, with the stated aim of improving the educational outcomes of some of the most disadvantaged pupils in English secondary schools. T...Read more...

Blog

LSE British Politics and Policy:

LSE Centre for Economic Performance: Reducing Crime: More Police, More Prisons or More Pay?

Crime is usually high on the list of voter concerns. This might seem surprising since total crime has fallen significantly since the mid 1990s. Yet two thirds of the population still (wrongly) think that crime is rising ...Read more...

Blog

LSE British Politics and Policy:

Hospital competition is good for patients, and for efficiency

The coalition government has taken great pains to assure the public that the NHS budget will be `ring-fenced?, and thus not subject to the cuts of 20 to 40 per cent forecast for other Whitehall departments. At the same t...Read more...

CentrePiece article

Jobs in the recession

The recession of 2008-09 inflicted a larger cumulative loss of UK output than any of the previous post-war recessions, yet there has been a relatively low loss of employment, at least so far. Paul Gregg and Jonathan Wads...Read more...

CEP occasional paper

The UK labour market and the 2008 - 2009 recession

The recession of 2008-2009 inflicted a larger cumulative loss of UK output than any of the other post-war recessions. Nevertheless, employment rates remained higher than might have been expected given the experience of p...Read more...

Blog

LSE British Politics and Policy:

LSE Centre for Economic Performance ? all election analyses are now available

The complete series of Election Analyses from the Centre for Economic Performance (CEP) is now available, summarising research evidence on some of the key policy battlegrounds of the 2010 UK General Election. The followi...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...

CEP discussion paper

Depression Econometrics: A FAVAR Model of Monetary Policy During the Great Depression

The prominent role of monetary policy in the U.S. interwar depression has been conventional wisdom since Friedman and Schwartz (1963). This paper presents evidence on both the surprise and the systematic components of mo...Read more...

CEP discussion paper

The Organization of Firms Across Countries

We argue that social capital as proxied by trust increases aggregate productivity by affecting the organization of firms. To do this we collect new data on the decentralization of investment, hiring, production, and sale...Read more...

CEP discussion paper

The Distinct Effects of Information Technology and Communication Technology on Firm Organization

Guided by theories of management by exception, we study the impact of Information and Communication Technology on worker and plant manager autonomy and on span of control. We find, using an original dataset of American a...Read more...

CEP discussion paper

Real Origins of the Great Depression: Monopoly Power, Unions and the American Business Cycle in the 1920s

We attempt to explain the severe 1920-21 recession, the roaring 1920s boom, and the slide into the Great Depression after 1929 in a unified framework. The model combines monopolistic product market competition with searc...Read more...

CEP discussion paper

Panic on the Streets of London: Police, Crime and the July 2005 Terror Attacks

In this paper we study the causal impact of police on crime by looking at what happened to crime before and after the terror attacks that hit central London in July 2005. The attacks resulted in a large redeployment of p...Read more...

CEP discussion paper

Creative Destruction with On-the-Job Search

This paper is about the labour market consequences of creative destruction with on-the-job search. We consider a matching model in an economy with embodied technological progress and show that its dynamics are profoundly...Read more...

Manpower Human Resource Lab paper

Are There Day of the Week Productivity Effects?

Despite much debate about the productivity effects of flexible working and the regulation of working hours little attention is paid to temporal variance in productivity. This paper explains why one might expect to see pr...Read more...

CentrePiece article

Panic on the streets of London

The terrorist attacks of 7 July 2005 resulted in a very large redeployment of police officers to central London boroughs. New research by Mirko Draca, Stephen Machin and Robert Witt looks at the impact of this increased ...Read more...

CEP discussion paper

Technology, Information and the Decentralization of the Firm

This paper develops a framework to analyze the relationship between the diffusion of new technologies and the decentralization decisions of firms. Centralized control relies on the information of the principal, which we ...Read more...

CEP discussion paper

Frustrated Demand for Unionisation: the Case of the United States and Canada Revisited

In this paper we demonstrate that there is a substantial union representation gap in the United States. We arrive at this conclusion by comparing Canadian and American worker responses to questions relating to desired un...Read more...

CEP discussion paper

Looking Into the Black Box: A Survey of the Matching Function

We survey the microfoundations, empirical evidence and estimation issues underlying the aggregate matching function. Several microeconomic matching mechanisms have been suggested in the literature with some successes but...Read more...

CEP discussion paper

The Fallacy of the Fiscal Theory of the Price Level

It is not common for an entire scholarly literature to be based on a fallacy, that is, 'on faulty reasoning; misleading or unsound argument'. The 'fiscal theory of the price level', recently re-developed by Woodford,...Read more...