Economics in Action

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Anyone who is good at using computers or communicating can expect to earn considerably more than their educational qualifications alone would suggest. That is the central conclusion of research by Professor Francis Green and Dr Andy Dickerson, presented at the Royal Economic Society’s Annual Conference.

Their analysis of the 2001 Skills Survey, a nationally representative survey of 4,500 working individuals in Britain aged 20-60 (and compares it with a similar survey of 2,500 individuals in 1997), shows that: (more…)

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High-profile plant closures and job-cuttings by multinational companies have refuelled the criticism that these firms are highly footloose, quick to shift their production facilities from one country to another if the current economic environment changes to their disadvantage. One example is the US car manufacturer Ford, which announced the end of car assembly at its Dagenham plant near London, leading to 1,100 job losses, as well as 1,400 jobs lost at its plant in Genk, Belgium as part of a strategy of restructuring European operations.

But research by Holger GÃrg and Eric Strobl, presented at the Royal Economic Society’s Annual Conference, suggests that the argument is not as clear-cut as critics of multinationals make it seem. While a comparison of foreign multinationals and domestic plants shows that the former are about 40% more likely to exit an industry than comparable domestic plants, new jobs created in multinationals are about 10% more likely to survive than jobs created in similar domestic plants. (more…)

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Up to 500,000 workers may have jobs because of the UKs adoption of an inflation target. That is the central conclusion of research by Professor Christopher Martin and colleagues, presented at the Royal Economic Society’s Annual Conference.

Monetary policy in the UK has been highly successful in recent years. Following the introduction of inflation targets in October 1992, inflation has remained within 1 percentage point of the target of 2.5%. This stability is in marked contrast to the high and volatile inflation rates experienced before 1992. (more…)