Posts Tagged ‘government’

Twenty commandments

September 12, 2016

Not mine; Dani Rodrik’s. Ten for economists, ten for non-economists.

Take a look below. Read Diane’s very positive review, and this more critical one by Unlearning Economics.

Then buy the book.



Ten commandments for economists

1/ Economics is a collection of models; cherish their diversity.

2/ It’s a model, not the model.

3/ Make your model simple enough to isolate specific causes and how theyr work, but not so simple that it leaves out key interactions among causes.

4/ Unrealistic assumptions are OK; unrealistic critical assumptions are not OK.

5/ The world is (almost) always second best.

6/ To map a model to the real world you need explicit empirical diagnostics, which is more craft than science.

7/ Do not confuse agreement among economists for certainty about how the world works.

8/ It’s OK to say ‘I don’t know’ when asked about the economy or policy.

9/ Efficiency is not everything.

10/ Substituting your values for the public’s is an abuse of your expertise.

Ten commandments for non-economists

1/ Economics is a collection of models with no predetermined conclusions; reject any arguments otherwise.

2/ Do not criticise an economist’s model because of its assumptions; ask how the results would change if certain problematic assumptions were more realistic.

3/ Analysis requires simplicity; beware of incoherence that passes itself off as complexity.

4/ Do not let maths scare you; economists use maths not because they’re smart, but because they’re not smart enough.

5/ When an economist makes a recommendation, ask what makes him/her sure the underlying model applies to the case at hand.

6/ When an economist uses the term ‘economic welfare’, ask what s/he means by it.

7/ Beware that an economist may speak differently in public than in the seminar room.

8/ Economists don’t (all) worship markets, but they know better how they work than you do.

9/ If you think all economists think alike, attend one of their seminars.

10/ If you think economists are especially rude to noneconomists, attend one of their seminars.


RGS talk on migration

May 13, 2016

(c) 2016 RGS

A late plug for this. I did a panel event on ‘Europe’s Migration Crisis’ with the Royal Geographical Society a few weeks back, alongside Heaven Crawley, Madeleine Sumption and Christina Boswell. The Guardian’s estimable David Walker chaired it.

I gave an overview of the local economics of migration, focusing on the recent UK experience, and drawing on some of my work – as well as borrowing a couple of nice maps from the Migration Observatory.


Here’s the summary I sent the organisers:

My talk will look at migration impacts at the local level, especially in cities. I’ll argue that we should look both at people flows, but also at the diversity that migration brings. Today’s public conversation about migration is focused on jobs, housing and public services. That’s understandable, and there are some real concerns here.

I also want to shift the conversation to cover migration as an influence on long term economic growth, with impacts on productivity, innovation, entrepreneurship and trade. Skilled migrants (from inside and outside the EU) are central to this, and the evidence we have suggests that there are positive effects of these groups on economic outcomes policymakers should care about. We need to know much more about how these channels work, of course. But national government and cities can start – now – to adjust policy to make more of these opportunities. 

There’s a nice write-up of the event on the RGS blog. If you want more detail, my slides are here.

Microsolutions to megaproblems

December 9, 2015

I have a chapter in this nice new Policy Press book, After Urban Regeneration, expertly edited by Dave O’Brien and Peter Matthews.

Here’s the intro [pdf].

The book takes a critical look at urban policy in the UK, particularly in the post-crash period, and explores the way thinking  about regeneration has changed under austerity, and under localism.

It tests the idea that we’re now in a ‘post-regeneration’ era; it also takes a close look at the way communities and ideas of ‘community’ have been used to design, deliver and justify programmes on the ground.

My chapter covers the recent history of UK economic regeneration, sets out what we can expect programmes to achieve given the mega-trends shaping urban economies and communities, and also explores how the ‘what works’ agenda can help, both in developing the evidence base and in hands-on policy design. Cities and communities have been in tough times for years now, but I try to find some grounds for cautious optimism.


The editors put together a strong and diverse team: we have excellent contributions from Stuart Wilks-Heeg, Antonia Layard, Kate Pahl, Liz Richardson and Chris Speed, as well as my Birmingham colleagues Catherine Durose and Phil Jones.

You can get the paperback here, or the hardback for a terrifying cost.

What I did in New Zealand

August 4, 2015

Matiu / Somes Island. (c) 2015 Max Nathan

Am back from New Zealand and just about over the jetlag. Thanks again to Motu and the Caddanz team for hosting me. I’m already plotting a return trip …

Here’s my talk from the Pathways conference. This is on the economics of migration and diversity, and brings together various projects from the past few years.

Here are slides and audio from my public policy talk at Motu. This looks at the What Works agenda in the UK, particularly the work of the What Works Centre for Local Economic Growth, and some of the opportunities and challenges these institutions face.

… and we’re live

October 25, 2013

our London launch

We had the London launch of the What Works Centre yesterday. It went very well – full room, sharp discussion, plus strong contributions from LSE’s Director Craig Calhoun, from BIS and DCLG Ministers Michael Fallon and Kris Hopkins and from Joanna Killian from Essex.

We’re off to Manchester in a couple of weeks for a second launch session. Details here.

Now the hard work begins

In the meantime you can catch up on what we’re up to here and here.

What Works

September 11, 2013

As some of you will know, LSE, the Centre for Cities and Arup will be running the new What Works Centre on local economic growth.

The Centre will conduct systematic reviews of UK and international research, ranking the most effective interventions, and will work closely with local government, local enterprise partnerships and other ‘users’ to help develop stronger economic policymaking across the UK. As NICE and the EEF already do, it may eventually commission research too.

The Centre has just begun work – we had a great workshop today with a number of our local partners – and we’ll formally launch later in the Autumn. We’ll be part of a network of six working on health, education, ageing, crime reduction and early intervention as well as local economies.

Henry Overman is stepping down from SERC to lead the Centre. I’m becoming one of the Deputy Directors, and will be working at LSE alongside my research-focused role at NIESR. I’ll be leading on the academic workstream, co-ordinating the systematic reviews and demonstrator projects, as well as advising Henry on the Centre’s direction.

We’ll be working with a strong team of academics across the country – in Liverpool, Leeds, Newcastle and Bristol, as well as London. We’ll also team up with New Economy Manchester on capacity-building and demonstrator projects. And we’ll be using the UK-wide networks developed by Centre for Cities and Arup.

Developing a new organisation from scratch is exciting, challenging and a huge amount of work, as I can attest from my early days at the Centre for Cities. Unlike most start-ups, we are very lucky to have secure initial funding. And we have an emerging body of good practice to draw on. But we still have a great deal to do in the months ahead. I look forward to working with many of you as we build out.

Big data and digital firms

July 23, 2013

(C) 2013 niesr and growth intelligence

I’ve just published some new analysis of the UK’s digital economy, joint with Anna Rosso and Growth Intelligence, and funded by Google. We had a launch session yesterday with Vince Cable – see here for a good write-up by the Guardian.

We’ve done pretty well for media so far: see coverage from the BBC, FT [£], Sky, Telegraph, Independent, Scotsman and Guardian (again) among others, and a nice blog post from Google’s Hal Varian.


This is the first phase of a research programme with roots in the resurgence of industrial policy around the world. Like many others, the UK government wants to promote ICT and digital content activities – in the global North at least, this is generally high value activity, with spillover effects to the rest of economy.

A big problem is that we have little idea of the true size and nature of these digital companies. That’s because official definitions use SIC codes, which don’t work well for companies doing innovative, high-tech stuff.

To try and fix this, we use big data provided by Growth Intelligence. GI pull in data from the web, social media, news feeds, patents and a range of other sources, and layer this on top of public data from Companies House. That gives a much richer picture of who’s out there, their characteristics and their performance.

Crucially, GI’s data buys us a lot more precision than SIC-based analysis. We can look at industries and at products, services, clients and distribution platforms.  For increasingly tech-powered sectors like architecture, that allows us to distinguish ‘digital’ companies producing (say) CAD specialist software from ‘non-digital’ ones making buildings.


Overall, we find over 40% more digital companies than official estimates suggest. We also find that digital companies who report revenue or employment are pretty resilient, with faster revenue growth and higher average employment than non-digital companies.

And contrary to the popular sense that it’s all about London start-ups, we find hotspots of digital activity across the country, including some perhaps surprising places like Aberdeen, Middlesbrough and Blackpool.


Okay, this is all fascinating stuff for researchers. But what should Government do differently? First, the big data field is still in its early days, and we’d encourage officials to explore how it can complement conventional statistics. Second, better data should lead to better-designed industrial policies. Finding the optimal policy mix, however, is a separate and much harder question to answer.

BIS’ information economy strategy is rightly cautious about hands-on intervention. This NBER paper by Aaron Chatterji, Ed Glaeser and Bill Kerr is a good overview of the wider evidence. Henry Overman and I will be publishing a piece in the Oxford Review of Economic Policy soon too, which puts the case for a more agglomeration-focused approach.

We’ll also be continuing the data analysis, thanks to further support from NESTA. Look out for further mapping and econometric work in the months ahead.

Barriers to the brightest?

July 2, 2013

The UK Government’s Migration Advisory Committee has just published some new research on the economic impacts of high skilled migrants, written by me alongside colleagues from NIESR and the Migration Observatory. We did a major review of the international evidence, and spoke to a number of Tier 1 entrepreneurs and investors living and working in the UK.

We found a number of areas where UK policy design could be smarter. In particular, we’ve suggested the UK start moving towards a genuine ‘start-up visa’ of the kinds operating in Canada and Chile, and being debated right now in the US.

You can read more in NIESR’s press release here. Or download the full report here.

This is not a Gateway

May 13, 2013

(c) Terry Farrell and Partners

I was in the Economist last week talking about the Thames Gateway. As New Labour’s flagship regeneration programme, the Gateway has not surprisingly been dropped by the Coalition. It hasn’t vanished completely though. Later this year, the Centre for London is publishing a collection of pieces on prospects for the area (for a flavour see this post and discussion). What we might call ‘Gateway Thinking’ also periodically reappears, for example in legacy planning for the Olympics, and in the proposed  Thames Estuary Airport.  And the place retains a strong hold over a certain kind of urbanist, especially in the dystopian excursioneering pioneered by Iain Sinclair and Laura Oldfield Ford.

I spent some time working on Gateway policy while in DCLG, and all of this got me looking back through old notes and papers. Some rough thoughts follow.


First, the Gateway concept now feels madly ambitious – especially compared to today’s minimalist development environment. Remember that the 70km Gateway was one of four ‘growth areas’ set out in the 2003 Sustainable Communities Plan.  The Plan proposed around  550,000 new homes in these zones by 2016 (42,000 a year, when current annual housing starts for the whole country are now around 98,000), and envisaged ‘delivery’ of  430,000 additional jobs.

In practice, the other three growth areas – Milton Keynes, Ashford, and the ‘Peterborough-Stansted-Cambridge’ corridor – involve building in popular areas where developers are happy to operate. The Gateway was always going to be a much more challenging environment.

Second, there was (and is) a strong social argument for public investment along the Thames Estuary. Some communities along the river are deeply deprived , with residents held back by low incomes, low skills and thin local labour markets.  However, the economic case is rather weaker. It was never clear whether the Gateway programme was intended  as a response to economic pressures in the Greater South East (in particular, high house prices and low building), or a much bolder attempt to restructure the deeper regional economy. Neither was it clear why these communities merited public spending ahead of (say) those in Manchester, Liverpool or Leeds.

The Greater South East economic ‘system’ is heavily weighted towards the North and West of London, where there is a polycentric system of smaller cities (Milton Keynes, Oxford, Cambridge, Reading) around the capital. East of London, towns and cities tend to be smaller and local economies are heavily commuter-powered.

As the Economist notes, parts of London’s economy have been moving Eastwards for years. But the Gateway attempts to shift the entire urban system  towards the East – and to shift activity away from commuting towards self-contained communities. The evidence tells us that urban economies are highly path-dependent (e.g. here, here and here), and  that this kind of rebalancing takes decades if it happens at all. By contrast, the Gateway strategy promised 160,000 net new homes and 180,000 net new jobs over 15 years.

Third, this terraforming aspect is integral to the Gateway’s staying power. As a classic grand projet, the programme was highly appealing to a certain kind of politician (Michael Heseltine, John Prescott, Gordon Brown) and urban planner (Richard Rogers, Terry Farrell). Brown actually raised the jobs target to 225,000 in 2007, just as the credit crunch was kicking in.

Such visioning also gets in the way of getting things done. An obvious but important example: the Gateway isn’t a single zone, but a collection of very disparate communities. This matters. Treating the Gateway as a kind of continuous policy space made for convenient shorthand in speeches, but obscures the huge differences between key economic sites like Canary Wharf and Shellhaven, versus smaller towns like Thurrock, and struggling former resorts like Southend.  Arguably, it also made it harder to think about economic development, since policy had to be retrofitted into a high-level planning concept rather than based on local circumstances.

Fourth, Gateway delivery systems were pretty badly designed. Governance somehow managed to be both too top-down, as explained above, and not dirigiste enough at a local level. Notably, detailed policy development was generally left to Urban Development Corporations, who lacked a democratic mandate, had no statutory powers and held no assets. By contrast, New Town Development Corporations could set long term planning goals, and leverage a substantial public land portfolio. The trade-off was the lack of accountability, but land holdings eventually transferred to local authorities.


None of this is to call time on the policy or the area. As I said earlier, the kind of deep structure change envisaged by Heseltine and others take decades to take shape. Developments like the London Gateway Port are potentially transformational, and London’s eastern boroughs will continue to evolve. By starting with economic fundamentals rather than grand planning, and placing help for individuals alongside physical regeneration,  a simpler, more effective approach might begin to emerge.

[apologies to TINAG for stealing the title.]

Policy-based evidence making

March 25, 2013

(c) BBC 2013Heads up: on 30th May I’ll be in Warwick to help give an advanced training session on  ‘Knowledge for Policy, Knowledge of Policy’, organised by the university’s Centre for Interdiscplinary Methodologies.

Evidence-based policymaking was a central trope of New Labour’s time in office.  The idea’s gone in deep: the Coalition is regularly taken to task for ideological policymaking – perhaps one reason  why the Cabinet Office has just announced a major network of ‘What Works’ Centres.

One immediate objection to evidence-driven policy is that evidence doesn’t tell you what you ought to do.  Political values and judgements – even ‘ideology’ – have their place, especially if the alternative is the apolitical solutionism that Evgeny Morozov has been taking to pieces recently.

There’s also an important role for an experimental state which builds an evidence base where none exists.  Sometimes this is pretty uncontroversial, as in the small nudges being tried out by the Government’s Behavioural Insights Team. It’s tougher to make the case in bigger areas of policy – such as devolution to local govt and communities, which has  never been seriously tried in the UK, where the risks of failure are massive, and where there are limits to what we can learn from abroad.  Here, the need for careful piloting is running up against Ministerial enthusiasm for transformational change.


What does this mean for researchers, especially academics? It’s important to have a clear sense of the policymaking process,  especially the invisible work which goes on between formal consultations and policy events; how policymakers treat different  kinds of evidence and actors in those processes, and the shifting positions of academics and think tanks in the ideas market.

I’ve co-founded a think tank, worked in central government and am now working in academia, so I’ll be bringing some of  these experiences to the seminar.  Also speaking will be Dave O’Brien (City University) and Will Davies (Warwick), who’s organising the session.  Both have similarly heterodox experiences, so it should be a fascinating day … see this post by Will, for instance.

Details here.

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