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New research findings from the Centre for Economic Performance published in CentrePiece

The Autumn 2004 issue of CentrePiece, the Centre for Economic Performance's magazine, is now available. A short summary of the five main articles follows, but for more information see http://cep.lse.ac.uk/centrepiece/default.asp| 

Cut travel times and improve Britain's productivity

Reducing average journey times throughout Britain would raise productivity significantly, especially in places where access to cities improves the most. If people are 30 minutes closer to a city in terms of driving times, their impact on productivity increases fourfold. These are among the conclusions of new research by Dr Patricia Rice and Professor Tony Venables published in the latest CentrePiece magazine.

The researchers have examined what drives variations in economic performance across the 120-odd 'NUTS3' administrative sub-regions of Britain. They find that access to cities has a big influence on regional productivity. Indeed, according to their calculations, doubling the economic mass to which an area has access - for example, by reducing journey times to the nearest big cities - can raise its productivity by 3.5 per cent. 

The research shows that below average access to cities contributes to the poor performance of several big regions of Britain, notably the North East, the South West, Wales and Scotland. Yet variations within these regions can be enormous: for example, Wales' overall 3 per cent productivity loss from below average access to cities ranges from plus 0.5 per cent in Cardiff to minus 9 per cent in Powys.

To read a PDF of the article, click here|

Teacher shortage: another impending crisis? 

How can the UK education system recruit and retain the high-quality teachers it needs, especially for the places and subjects where there are severe shortages? Research surveyed by Dr Arnaud Chevalier and Professor Peter Dolton examines the role of pay and other incentives in getting people into the profession and keeping them. 

Among the findings:

  • Nearly 50 per cent of primary teachers may have retired within the next ten years. In secondary schools, teachers in maths, languages and English are disproportionately more likely to resign.
  • When teachers' relative pay is low, graduates are less likely to enter the profession. But pay is  not the only cause of teachers' dissatisfaction with their work. Performance-related pay is unlikely to solve the problem of teacher recruitment.
  • The supply of graduates to teaching improves when graduate unemployment is high. But graduates are considerably less likely to be teachers if they live in London.

To read a PDF of the article, click here|

North and South: the impact of EU membership on the geography of UK trade and manufacturing 

Since the UK joined the European Union in 1973, there has been a dramatic reorientation of manufacturing trade to ports in the South. Most notably, Dover has become a major trading port and Liverpool has seen a corresponding decline. These are among the conclusions of research by Dr Henry Overman and Professor Alan Winters, published in CentrePiece.

The research shows how joining the EEC (as it was then known) shifted UK trade away from former trading partners and towards the six original members - France, Germany, Italy and the Benelux countries. Between 1973 and 1992, the share of UK trade with these six countries went from 21 per cent to 44 per cent.

The researchers also examine the impact of EU membership on the location of manufacturing within the  UK. Improved export market access has pulled employment in some manufacturing sectors towards the South, yet greater import competition has pushed employment in some manufacturing sectors away from the South. So, for example, the centre of gravity of the pharmaceutical industry has moved southwards while that of textile production has moved northwards. 

To read a PDF of the article, click here|

Jobless recovery: whatever happened to the great American jobs machine? 

In terms of employment creation, the US economic expansion since 2001 has been the worst in over half a century. New research by Professors Richard Freeman and William Rodgers finds that the unprecedently large trade deficit, falling inward investment and offshoring have all contributed to this 'jobless recovery'. And although the fiscal stimulus (from tax cuts for the rich) has been bigger in this recovery than previous ones, it has had a smaller impact on GDP growth.

The researchers point out how important it is for the United States to jump-start its stalled jobs machine, particularly since American welfare policy means having full employment not a social welfare state. Their study reveals that disadvantaged groups have had worse employment experiences relative  to other workers than in previous recoveries. At the same time, white-collar workers have had more trouble finding jobs than in virtually any other recovery.

To read a PDF of the article, click here|

Seeking a premier economy: the impact of British economic reforms since 1980 

Since the early 1980s, successive UK governments have enacted a series of economic reforms to establish a more market-oriented economy and arrest long-term relative decline. A major new book, summarised in CentrePiece, assesses the impact on productivity, employment and income inequality.

Among its findings:

  • Market-oriented reforms have accomplished the broad goal of improving relative economic performance. Privatisation has been associated with improved productivity. And unionised firms have adopted new work practices bringing productivity up to non-union levels
  • But while the UK has avoided the US problem of falling real earnings for lower paid workers, income inequality has become increasingly similar to that in the United States.

To read a PDF of the article, click here|


Contact: Romesh Vaitilingam on 0117 983 9770, 07768 661095, email romesh@compuserve.com| or visit http://cep.lse.ac.uk/centrepiece/default.asp| 

Press cuttings

Class size crisis looms as more teachers quit (19 Dec)
Britain's education system is short of tens of thousands of teachers as staff fed-up with long hours and low pay quit, according to a new study. According to the report's authors, Arnaud Chevalier and Peter Dolton, CEP, the UK primary school sector is likely to suffer the biggest shortage. 

Top-up fee move threatens student teacher recruitment (17 Dec)
Reference to research by LSE, warning that schools in England will be hit by a serious shortage of teachers over the next 10 years as nearly half of present staff retire.

Report predicts 'serious' teacher shortage (16 Dec)
Schools in England are going to be hit by a serious shortage of teachers over the next 10 years as nearly half of present staff retire, warns a report from LSE. 

Study warns of pending teacher shortage (15 Dec)
Schools in England are going to be hit by a serious shortage of teachers over the next 10 years as nearly half of current staff retire, according research by the Centre for Economic Performance at LSE.No direct link 

15 December 2004