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The Programme on Innovation and Diffusion (POID) carries out cutting-edge research into how to improve productivity through nurturing innovation – ideas that are new to the world – and then diffusing these ideas across the economy

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Portrait of Anna Valero. Published under CC0 Public Domain. Credit: POID
Anna Valero joins economic advisory council

Anna Valero has been appointed to the chancellor's economic advisory council, providing expert advice on economic policy to help grow the economy.
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Economy2030 logo. Published under CC0 Public Domain.
CEP-POID-Economy 2030 Inquiry Workshop

In the (closed) workshop sessions, we will discuss and inform ongoing research and the formulation of policy proposals during Phase Two of the inquiry, which concludes in late 2023.
About POID

The Programme on Innovation and Diffusion (POID) carries out cutting-edge research into how to improve productivity through nurturing innovation - ideas that are new to the world - and then diffusing these ideas across the economy. Read more...

Latest

Growth of the UK economy

Growth and productivity are often talked about in UK politics, but how are they linked and what effect do they have on the economy? John Van Reenen explains.
Watch online...
Photo of fields, houses and roads. Published under CC0 Public Domain. Credit: Sasha Set, https://unsplash.com/photos/GURzQwO8Li0/
Environment Week, September '23

Call for Papers

EEE, IGC and POID is convening the second Environment Week at the LSE on 11-15 September 2023. We are soliciting papers from faculty and PhD students in all areas of the economics of environment and energy. The deadline is 19 June 23:59 GMT.

Picture of solar panels. Published under CC0 Public Domain. Credit: Michael Wilson, https://unsplash.com/photos/Wp7wotWlbBk/
The Case for Green Industrial Policy

John Van Reenen questions how governments can manage to improve the environmental performance of key business sectors without subverting competition and subsidizing special interests.
Read more....

Lecture - taken from Banque de France event - https://www.banque-france.fr/en/economics-creative-destruction
The Economics of Creative Destruction

Forthcoming book, edited by POID Director John Van Reenen and Ufuk Akcigit (Chicago), to be published in 2023. Based on a 4-day conference in honour of POID member Philippe Aghion and his long-time collaborator Peter Howitt. Find out more...
Hands counting coins, by Towfiqu Barbhuiya source: https://unsplash.com/photos/jpqyfK7GB4w
A budget for (green) growth? Unfortunately, not yet.

More of a boost is needed if we are to increase our investment rate to match other advanced economies. Anna Valero and Esin Serin ask to what extent has the Spring Budget taken us in the right direction? Read more....
International Women's Day 2023

To mark International Women's Day, economists from CEP and POID talk about their research work.
Watch online...

Latest Publications

POID Working Paper
The distributional effects of trade: Theory and evidence from the United States

How much do consumption patterns matter for the impact of international trade on inequality? In neoclassical trade models, the effects of trade shocks on consumers' purchasing power are governed by the shares of imports ...Read more...

Kirill Borusyak and Xavier Jaravel

1 June 2023

POID Working Paper
Trading places: Mobility responses of native and foreign-born adults to the China trade shock

Previous research finds that the greater geographic mobility of foreign than native-born workers following economic shocks helps to facilitate local labor market adjustment to shifting regional economic conditions. We ex...Read more...

David Autor, David Dorn and Gordon H. Hanson

1 June 2023

POID Working Paper
Does Chinese research hinge on US co-authors? Evidence from the China Initiative

Launched in November 2018 by the Trump administration, the China Initiative was meant to "protect US intellectual property and technologies against Chinese Economic Espionage". In practice, it made administrative procedu...Read more...

Philippe Aghion, Celine Antonin, Luc Paluskiewicz, David Stromberg, Xueping Sun, Raphael Wargon and Karoline Westin

1 June 2023

POID Working Paper
Evaluating merger effects

This paper proposes a new algorithm with which to identify the potential effect of mergers by comparing the outcomes of interest in areas of overlap for the merging parties vis-à-vis areas of no overlap within a differe...Read more...

Christos Genakos, Andreas Lamprinidis and James Walker

1 June 2023

POID Working Paper
Time savings when working from home

We quantify the commute time savings associated with work from home, drawing on data for 27 countries. The average daily time savings when working from home is 72 minutes in our sample. We estimate that work from home sa...Read more...

Cevat Giray Aksoy, Jose Maria Barrero, Nicholas Bloom, Steven J. Davis, Mathias Dolls and Pablo Zarate

22 May 2023

POID Working Paper
Long social distancing

Many working-age Americans say they will continue some forms of social distancing after the COVID-19 pandemic ends. We uncover this long social distancing phenomenon in our monthly Survey of Working Arrangements and Atti...Read more...

Jose Maria Barrero, Nicholas Bloom and Steven J. Davis

22 May 2023

POID Working Paper
Firming up price inflation

We use data from a large panel survey of UK firms to analyze the economic drivers of price setting since the start of the Covid pandemic. Inflation responded asymmetrically to movements in demand. This helps to explain w...Read more...

Lena Anayi, Nicholas Bloom, Philip Bunn, Paul Mizen, Gregory Thwaites and Ivan Yotzov

22 May 2023

POID Working Paper
FDI and superstar spillovers: Evidence from firm-to-firm transactions

Despite competition concerns over the increasing dominance of global corporations, many argue that productivity spillovers from multinationals to domestic firms justify pro-FDI policies. For the first time, we use firm-t...Read more...

Mary Amiti, Cedric Duprez, Jozef Konings and John Van Reenen

27 April 2023

POID Working Paper
Local and national concentration trends in jobs and sales: The role of structural transformation

National industrial concentration in the U.S. has risen sharply since the early 1980s, but there remains dispute over whether local geographic concentration has followed a similar trend. Using near population data from t...Read more...

David Autor, Christina Patterson and John Van Reenen

19 April 2023

POID Working 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...

Enrico Berkes, Davide M. Coluccia, Gaia Dossi and Mara P. Squicciarini

23 March 2023

POID Working Paper
Remote work across jobs, companies and space

The pandemic catalyzed an enduring shift to remote work. To measure and characterize this shift, we examine more than 250 million job vacancy postings across five English-speaking countries. Our measurements rely on a st...Read more...

Nicholas Bloom, Steven J. Davis, Stephen Hansen, Peter Lambert, Raffaella Sadun and Bledi Taska

17 March 2023

POID Working Paper
Incorporating innovation in competition policy

This report, conducted by a group of Master of Public Administration (MPA) students at the London School of Economics and Political Science, seeks to inform the UK Competition and Markets Authority (CMA) on how it should...Read more...

Bethany Carter, Ignacio Loeser, Maria Jose Lopez, Martin de Dios and Mariana del Rio

12 January 2023

POID Working Paper
Dissecting the sinews of power: International trade and the rise of Britain's fiscal military state, 1689-1823

We evaluate the role of taxes on trade in the development of imperial Britain's fiscal-military state. Influential work, e.g., Brewer's (1989) Sinews of Power, attributed increased fiscal capacity to the taxation of dome...Read more...

Ernesto Dal Bo, Karolina Hutkova, Lukas Leucht and Noam Yuchtman

20 December 2022

POID Working Paper
Market power and innovation in the intangible economy

This paper offers a unified explanation for the slowdown of productivity growth, the decline in business dynamism and the rise of market power. Using a quantitative framework, I show that the rise of intangible inputs - ...Read more...

Maarten de Ridder

20 December 2022

POID Working Paper
The Hitchhiker's guide to markup estimation

Is it feasible to estimate firm-level markups with commonly available datasets? Common methods to measure markups hinge on a production function estimation, but most datasets do not contain data on the quantity that firm...Read more...

Basile Grassi, Giovanni Morzenti and Maarten de Ridder

20 December 2022

POID Working Paper
The world uncertainty index

We construct the World Uncertainty Index (WUI) for an unbalanced panel of 143 individual countries on a quarterly basis from 1952. This is the frequency of the word "uncertainty" in the quarterly Economist Intelligence U...Read more...

Hites Ahir, Nicholas Bloom and Davide Furceri

15 December 2022

POID Working Paper
The impact of COVID-19 on productivity

We analyse the impact of Covid-19 on productivity using data from an innovative monthly firm survey panel that asks for quantitative impacts of Covid on inputs and outputs. We find total factor productivity (TFP) fell by...Read more...

Nicholas Bloom, Philip Bunn, Paul Mizen, Pawel Smietanka and Gregory Thwaites

15 December 2022

POID Working Paper
The shift to remote work lessens wage-growth pressure

The recent shift to remote work raised the amenity value of employment. As compensation adjusts to share the amenity-value gains with employers, wage-growth pressures moderate. We find empirical support for this mechanis...Read more...

Jose Maria Barrero, Nicholas Bloom, Steven J. Davis, Brent Meyer and Emil Mihaylov

15 December 2022

POID Working Paper
How hybrid working from home works out

Hybrid working from home (WFH), whereby employees work a mix of days at home and at work each week, has become dominant for graduate employees in the US. This paper evaluates a randomized control trial on 1612 engineers,...Read more...

Nicholas Bloom, Ruobing Han and James Liang

15 December 2022

POID Working Paper
Firming up price inflation

We use data from a large panel survey of UK firms to analyze the economic drivers of price setting since the start of the Covid pandemic. Inflation responded asymmetrically to movements in demand. This helps to explain w...Read more...

Lena Anayi, Nicholas Bloom, Philip Bunn, Paul Mizen, Gregory Thwaites and Ivan Yotzov

15 December 2022

POID Working Paper
Working from home around the world

The pandemic triggered a large, lasting shift to work from home (WFH). To study this shift, we survey full-time workers who finished primary school in 27 countries as of mid-2021 and early 2022. Our cross country compari...Read more...

Cevat Giray Aksoy, Jose Maria Barrero, Nicholas Bloom, Steven J. Davis, Mathias Dolls and Pablo Zarate

15 December 2022

POID Working Paper
Long social distancing

More than ten percent of Americans with recent work experience say they will continue social distancing after the COVID-19 pandemic ends, and another 45 percent will do so in limited ways. We uncover this Long Social Dis...Read more...

Jose Maria Barrero, Nicholas Bloom and Steven J. Davis

15 December 2022

POID Working Paper
Managerial and financial barriers during the green transition

We use data on 10,852 firms across 22 emerging markets to analyse how credit constraints and deficient firm management inhibit corporate investment in green technologies. For identification, we exploit quasi-exogenous va...Read more...

Ralph De Haas, Ralf Martin, Mirabelle Muûls and Helena Schweiger

15 December 2022

POID Working Paper
Efficient industrial policy for innovation: standing on the shoulders of hidden giants

Research and development is underprovided whenever it creates knowledge spillovers that drive a wedge between its total and private economic returns. Heterogeneity in the intensity of this market failure across technolog...Read more...

Charlotte Guillard, Ralf Martin, Pierre Mohnen, Catherine Thomas and Dennis Verhoeven

15 December 2022

POID Working Paper
Knowledge spillovers from clean and emerging technologies in the UK

The UK government has committed to increase R&D support for clean technologies in an effort to meet its net-zero target by 2050. The opportunity cost of such programs crucially depends on the value of knowledge spillover...Read more...

Ralf Martin and Dennis Verhoeven

15 December 2022

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CEP Covid-19 analysis
The business response to Covid-19 one year on: findings from the second wave of the CEP-CBI survey on technology adoption

We present new data from a survey of 425 UK businesses conducted in July 2021 in partnership with the Confederation of British Industry (CBI), which seeks to understand the ways in which firms have innovated one year on ...Read more...

Juliana Oliveira-Cunha, Capucine Riom and Anna Valero

10 November 2021

CEP report
Are 'green' jobs good jobs?

The transition to net-zero will have far-reaching but unequal effects, as 'dirty' jobs disappear while new jobs aligned with or supportive of the net-zero objective - which we refer to as 'green' - are created. As govern...Read more...

Mirko Draca, Jiaqi Li, Sabrina Muller, Viet Nguyen-Tien, Capucine Riom and Anna Valero

28 October 2021

CEP report
Seizing sustainable growth opportunities from carbon capture, usage and storage in the UK

Seizing opportunities from the CCUS value chain can be part of an economy-wide, net-zero-aligned growth path in the UK. The UK has responded to the climate emergency facing the world with an economy-wide target to reach...Read more...

Pia Andres, Ralf Martin, Penny Mealy, Esin Serin, Arjun Shah and Anna Valero

22 September 2021

CEP Covid-19 analysis
A major wave of UK business closures by April 2021? The scale of the problem and what can be done

This report presents an analysis of the financial health of UK businesses, which shows that immediate action is needed to prevent a wave of corporate failure in early April. We cannot delay action. Now is also the moment...Read more...

Peter Lambert and John Van Reenen

27 January 2021

CEP Covid-19 analysis
Innovation for a strong and sustainable recovery

In the recovery from Covid-19, innovation and diffusion will be key to addressing several structural challenges facing the UK economy. These include improving the UK’s longstanding poor productivity performance, addressi...Read more...

Ralf Martin, Sam Unsworth, Anna Valero and Dennis Verhoeven

18 December 2020

CEP Covid-19 analysis
Jobs for a strong and sustainable recovery from Covid-19

The UK’s future economic, social and environmental prosperity will be shaped by how it deals with, and recovers from, the impact of Covid-19. This paper sets out coordinated net-zero-aligned investments which the UK can ...Read more...

Pia Andres, Giorgia Cecchinato, Penny Mealy, Charlotte Taylor, Sam Unsworth and Anna Valero

19 October 2020

CEP Covid-19 analysis
The business response to Covid-19: the CEP-CBI survey on technology adoption

We present new data from a survey of 375 UK businesses conducted in July 2020 in partnership with the Confederation of British Industry (CBI), which seeks to understand the way in which firms have innovated in response t...Read more...

Capucine Riom and Anna Valero

30 September 2020

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Blog
LSE USAPP:
The 1918 flu pandemic made some people more religious, and others, more innovative.

Enrico Berkes, Davide Coluccia, Gaia Dossi and Mara Squicciarini investigate whether a destructive event - such as a pandemic - leads to either an increase in religiosity or a boost in innovation efforts. They find that ...Read more...

Enrico Berkes, Davide M. Coluccia, Gaia Dossi and Mara P. Squicciarini

24 May 2023

Blog
LSE:
Why has productivity in the UK slowed? (video)

Growth and productivity are often talked about in UK politics but how are they linked and what affect do they have on the economy? John Van Reenen explains....Read more...

John Van Reenen

19 May 2023

Blog
Economics Observatory:
Frontline stories: protecting biodiversity

Ahead of COP26 in 2021, Richard Davies talked to Dr Jane Goodall DBE, one of the world's leading environmentalists, founder of the Jane Goodall Institute and a United Nations Messenger of Peace....Read more...

Richard Davies and Jane Goodall

12 May 2023

Blog
LSE Business Review:
Creditors use startups' choice of legal form as a signal for debt financing

Formal debt financing is an important source of external financing for startups, but creditors face information gaps, as startups lack a proven track record. Felix Bracht, Jeroen Mahieu and Steven Vanhaverbeke argue that...Read more...

Felix Bracht, Jeroen Mahieu and Steven Vanhaverbeke

4 May 2023

Blog
CATO Institute:
The Impact of Regulation on Innovation

Many scholars have been concerned that slower growth in countries with heavy labour regulations could be due to firms' reluctance to innovate given the burden of red tape. Philippe Aghion, Antonin Bergeaud and John Van R...Read more...

Philippe Aghion, Antonin Bergeaud and John Van Reenen

19 April 2023

Blog
Vox EU:
Using job postings to quantify remote work

The COVID pandemic initiated an enduring shift to remote work. But there is little evidence to explain where this shift is taking place at a micro level because the sample sizes are too small. Stephen Hansen, Peter Lambe...Read more...

Nicholas Bloom, Steven J. Davis, Stephen Hansen, Peter Lambert, Raffaella Sadun and Bledi Taska

18 April 2023

Blog
Vox EU:
Local concentration and structural transformation

The national market shares of the leading US firms in many industries have risen substantially over the last four decades - ie, these industries have become more concentrated. David Autor, Christina Patterson and John Va...Read more...

David Autor, Christina Patterson and John Van Reenen

12 April 2023

Blog
LSE British Politics and Policy:
A budget for (green) growth? Unfortunately, not yet.

In light of the climate crisis, the energy and cost-of-living crises, and longstanding productivity problems urgently needed addressing, the Spring 2023 Budget was a key moment for the government to make progress in prov...Read more...

Esin Serin and Anna Valero

16 March 2023

Blog
Economics Observatory:
How has Brexit affected business investment in the UK?

Leaving the European Union has undoubtedly had effects on the UK economy. The most obvious ones will be on international trade. But Brexit might also have an impact on business investment, which is crucial for the econom...Read more...

Jonathan Haskel and Josh Martin

13 March 2023

Blog
Vox EU:
Observing freedom's vanishing act

The political equilibrium in Hong Kong was fundamentally altered in June 2020, when the Chinese Communist Party began coercively suppressing all protest. Noam Yuchtman provides a first-hand account of watching civil libe...Read more...

Noam Yuchtman

1 March 2023

Blog
Promarket:
The Case for Green Industrial Policy

Industrial policy was once so old-fashioned that it was jokingly called "the policy that shall not be named". Now it's back in a big way. On issues ranging from clean energy to semiconductors to Covid-19, governments are...Read more...

John Van Reenen

14 February 2023

Blog
Vox EU:
Commute time savings when working from home

The large shift to work from home during the Covid-19 pandemic reduced the amount of time that workers spend commuting. This column reports on a global survey of workers in 27 countries showing that working from home sav...Read more...

Cevat Giray Aksoy, Jose Maria Barrero, Nicholas Bloom, Steven J. Davis, Mathias Dolls and Pablo Zarate

24 January 2023

Blog
Vox EU:
Tracking uncertainty in a rapidly changing global economic outlook

Tracking uncertainty at a high frequency is useful in the context of the multiple shocks that have hit the global economy over the past years and to disentangle the sources of uncertainty. This column presents a new mont...Read more...

Hites Ahir, Nicholas Bloom and Davide Furceri

17 December 2022

Blog
Vox EU:
Firm inflation expectations in quantitative and text data

Inflation rates and short-term inflation expectations in the UK have increased significantly since 2021. This column uses quantitative and text data from the Decision Maker Panel to analyse the factors affecting inflatio...Read more...

Nicholas Bloom, Philip Bunn, Paul Mizen, Gregory Thwaites, Ivan Yotzov and Özgen Öztürk

8 December 2022

Blog
BBC Radio 4:
Understand The Economy: 7. Jobs and Unemployment (podcast)

What happens when lots of people lose their jobs? Why might wages be low even though everyone who wants a job, has one? What do we mean by employment and unemployment and what does 'economic inactivity' mean? What is pro...Read more...

Richard Davies and Tim Harford

29 November 2022

Blog
Research Professional News:
Autumn statement delivered reassurance, but not vision

Investing in innovation is key to the future prosperity of an advanced economy such as the UK. Chancellor Jeremy Hunt's 17 November autumn statement confirmed a commitment to raising public investments in science. Despit...Read more...

Anna Valero and John Van Reenen

28 November 2022

Blog
Harvard Business Review:
The Myth of the Brilliant, Charismatic Leader

There's a view out there - call it the "superhero" theory of leadership - in which the individual vision, charisma, and brilliance of a CEO makes or breaks a company. That view is dangerous - not so much because CEOs don...Read more...

Raffaella Sadun

23 November 2022

Blog
LSE Business Review:
What is the contribution of China to pushing the technological frontier?

China's technological strength has been increasing since the late 2000s, accounting for a significant share of patents. Antonin Bergeaud and Cyril Verluise show that while China's share of patents is increasing in quanti...Read more...

Antonin Bergeaud and Cyril Verluise

23 November 2022

Blog
LSE Business Review:
Autumn Statement: 'no one will be spared the pain'

Chancellor Jeremy Hunt faces a difficult balancing act to try and delay many measures while doing enough in the short run to appease the markets. John Van Reenen comments briefly on what can be expected in the Autumn Sta...Read more...

John Van Reenen

16 November 2022

Blog
The ECB Blog:
Can Europe be a green innovation leader?

Europe is punching below its weight in the climate-technology competition. The continent needs to facilitate risk capital markets and to invest more in research and development. This is the 4th post in a series of climat...Read more...

Philippe Aghion, Lena Boneva, Johannes Breckenfelder, Luc Laeven, Conny Olovsson, Alexander Popov and Elena Rancoita

15 November 2022

Blog
Understand: The Economy:
Understand The Economy: 2. Interest Rates and Mortgage Rates (podcast)

In this episode, Tim Harford explains why the banks charge interest when we borrow money and explains why the Bank of England might put interest rates up. Richard Davies is a guest on this episode of Understand: The Econ...Read more...

Richard Davies and Tim Harford

3 November 2022

Blog
BBC Radio 4:
Understand The Economy: 1. Inflation (podcast)

Understanding inflation can help understand why our shopping is getting more and more expensive and why prices rarely seem to come down. Tim Harford explains why the inflation figure we see on the TV might not reflect th...Read more...

Richard Davies and Tim Harford

31 October 2022

Blog
LSE Business Review:
Clean technologies for growth and equity

Public investment in developing energy sources that don't cause climate change is a strategy for economic growth that could also contribute to the UK's levelling up agenda, says Ralf Martin. His analysis indicates that s...Read more...

Ralf Martin

24 October 2022

Blog
LSE Business Review:
Nothing is booming in Britain, except uncertainty. This is not the time to cut public investment in research

Britain has suffered from a turbulent policy environment for a while. Following chancellor Jeremy Hunt's reversal of nearly all of the mini-budget tax measures and reigned in energy support, difficult spending cuts are c...Read more...

Anna Valero and John Van Reenen

20 October 2022

Blog
LSE British Politics and Policy :
Why have energy bills in the UK been rising?

The UK is particularly exposed to the energy crisis sweeping across the world. After predictions that annual household bills were due to rise from around £1,000 to £3,500 in October 2022, the government announced it woul...Read more...

Anna Valero

20 October 2022

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