News
This section features media releases and announcements from the Programme on Innovation and Diffusion.
Financial Times:
UK suffering ‘drama discount’ on business investment
27 September 2022
...the UK government has a particular credibility problem. This is partly because its pledges lacked detail. It is partly because loosening immigration rules, or liberalising planning, are politically fraught for the Conservative party. And it’s partly that these are long-term commitments after years of what John Van Reenen at the LSE’s Programme on Innovation and Diffusion calls “policy attention deficit disorder.”
ABC:
In the wake of the Queen's death, Britain is facing an economic divide and a new struggle street
23 September 2022
While I was there, I sought out the London School of Economics senior fellow in the School of Economic Performance, Anna Valero, on the economic challenges facing Britain right now and she lamented a "lost summer" of policy paralysis while the Conservative leadership fell apart.
BBC Radio 4:
The Briefing Room
22 September 2022
Dr Anna Valero of the LSE on low productivity and economic growth in the UK.
ABC:
London School of Economics senior fellow Anna Valero on soaring cost-of-living, energy crisis
21 September 2022
ABC Radio Melbourne Mornings presenter Virginia Trioli spoke to Anna Valero, senior policy fellow at the London School of Economics, about what comes next
Tribune:
The Tory Answer to Everything: Make the Rich Richer
20 September 2022
According to a report by the London School of Economics, "since 1981, there has been a 25% decoupling between wages and productivity as workers have been squeezed to increase profit margins", says Professor John Van Reenen.
Harvard Business Review:
Visualizing a Century of Management Ideas
20 September 2022
How has HBR’s approach to covering management topics over the past century changed? And what can these changes tell us about the evolving nature of the challenges faced by managers? The authors Nicholas Bloom, Raffaella Sadun and Tejas Ramdas analyzed every article HBR published from 1922 to 2021. They found an early preponderance of language relating to finance & accounting and operations, followed by a steady and gradual decline; a steady and substantial increase in language relating to strategy and marketing; and a persistent and substantial share of language relating to organizations and human resources.
Yorkshire Post:
Why workers should prepare for the possibility of long-term sickness
17 September 2022
The official figures show that sickness or disability has driven 1.4 million 50-64-year-olds to leave the workforce, but Jonathan Haskel, Economics Professor at Imperial College Business School and an external member of the Bank of England Monetary Policy Committee, thinks this is an understatement.
Chellenges.fr:
TRIBUNE- Invest and decentralize schools to make them more egalitarian
3 September 2022
Above all, France is the OECD country where educational results are most strongly correlated with socio-economic origin: there are therefore many "lost Einsteins", talented children who, coming from disadvantaged backgrounds, do not acquire the knowledge or vocation necessary to exercise a high-qualification profession, to become engineers, entrepreneurs, researchers, innovators.
LSE Business Review:
What should the next UK prime minister do?
2 September 2022
Britain faces crises in energy and productivity, both of which have been crushing people’s living standards. However, neither is being addressed by the two leadership candidates, Rishi Sunak and Liz Truss. Anna Valero and John Van Reenen write that the endemic short-termism of the public and private sectors needs to be reversed, so that barriers to investment can be addressed. For them, the UK is in urgent need of a new economic strategy for stronger, fairer, and sustainable growth.
Read more at LSE Business Review
The Economist:
The missing pandemic innovation boom
28 August 2022
...If people could develop life-saving inoculations in months, why couldn’t the world move out of its low-growth, low-productivity slumber? Firms could embrace digitisation as never before.
The Telegraph:
Apocalypse arrives for the ‘zombie’ companies haunting UK growth
21 August 2022
Professor John Van Reenen, a productivity expert at the London School of Economics, says this even continued through the pandemic, when generous government support gave the teetering companies a stay of execution. Yet with the Bank of England raising interest rates from 0.1pc to 1.75pc in less than a year, a reckoning is coming - and the result could be a tsunami of insolvencies and job losses. "Zombie companies have been kept on this kind of artificial life support by low interest rates, and some of the banks have been reluctant to call in loans," Van Reenen explains.
Boston Review:
The New Moral Mathematics
15 August 2022
There is evidence that technological process has already slowed down outside the areas of computation and AI. The rate of growth in “total factor productivity”—our ability to get more economic output from the same input—is declining, and according to a recent study by economists at Stanford and the London School of Economics, new ideas are increasingly scarce.
CNN Business:
The frontrunner to become the UK's next leader has a risky economic plan
8 August 2022
But John Van Reenen, a professor at the London School of Economics, among others, disagrees."[She's] wrong. It won't decrease inflation, it will increase inflation," he told CNN Business.
Ideas for India:
The future of work from home
29 July 2022
With the outset of the Covid-19 pandemic, work from home became the norm in 2020. However, even though mobility restrictions have been lifted, .. In this edition of I4I Conversations, Nirvikar Singh (University of California, Santa Cruz) and Nicholas Bloom (Stanford University) talk about the future of work. They delve into Prof Bloom's seminal work on management practices and work from home prior to the pandemic.
La Croix:
Purchasing power: compromises, but a budget envelope generally respected
27 July 2022
...go. "Such an approach made it possible to prepare minds for the reduction of energy aid, while meeting the challenges of the energy transition", estimates Xavier Jaravel, professor of economics at the London School of Economics. expense...
Inc. Magazine:
Worried That Others Are Texting While Driving? Here's What They're Really Doing, Harvard Study Shows It's even more dangerous than you think
22 July 2022
"We were expecting to see some multitasking in the car, but honestly not to the extent reported in the survey," Harvard professor of business administration and study co-author Raffaella Sadun said in an account of the findings. And Sadun suspects it could be even more common that the study suggests, since some multi-tasking respondents may have been unwilling to admit to this potentially dangerous behavior.
VOX EU:
Levelling up productivity gaps in the UK
20 July 2022
This view is espoused by James Smith: "More investment in transport and communications infrastructure would reduce incentives for industries to cluster." John Van Reenen (London School of Economics and Political Science) further substantiated this viewpoint, citing Criscuolo et al. (2019) as evidence of the efficacy of UK place-based investment subsidies.
HBS Working Knowledge:
When the Rubber Meets the Road, Most Commuters Text and Email While Driving
14 July 2022
Laws and grim warnings have done little to deter distracted driving. Commuters routinely use their time behind the wheel to catch up on emails, says research by Raffaella Sadun, Thomaz Teodorovicz, and colleagues. What will it take to make roads safer?
Surface Mag:
What Should the Post-Pandemic Office Look Like?
14 July 2022
Last year, Stanford University economics professor Nick Bloom, who studies work-from-home trends, forecasted that the Delta variant would be "the final nail in the coffin of the five-day return to the office." His predictions were largely correct—Twitter announced indefinite work-from-home policies while Airbnb left the choice in the hands of employees.
The Economist:
What's behind Britain's growth crisis? (Podcast)
13 July 2022
Our podcast on markets, the economy and business. This week, we examine the cause of Britain's low economic growth and look at ways to improve it. Then, Anna Valero of London School of Economics explains what's behind Britain's tepid growth: a productivity crisis.
Listen to the podcast at The Economist
The New York Times:
Technology and the Triumph of Pessimism
28 June 2022
...The second era was the “30 glorious years,” the decades after World War II when social democracy — a market economy with its rough edges smoothed off by labor unions and a strong social safety net — seemed to be producing not Utopia, but the most decent societies humanity had ever known. This column highlights article "Are Ideas Getting Harder to Find?" (Bloom, Jones, Van Reenen, Webb), American Economic Review 2020, 110(4): 1104–1144.
Read more at The New York Times
The Times:
Soaring costs have greater impact on smaller firms
27 June 2022
…at the start of last year, according to analysis of figures from the Office for National Statistics by the London School of Economics (LSE).
Engineering & Technology:
UK decarbonisation will lead to job changes rather than losses, report finds
20 June 2022
…Anna Valero, senior policy fellow at the Centre for Economic Performance, said: "Securing a 'green job' is likely to lead to higher wages, but entry into those jobs is dominated by those with higher skills. ..."
Read more at Engineering & Technology
Inc.com:
New Stanford Study: Half of Workers are ignoring requirements to return to the office full-time (and bosses don’t know what to do about it)
17 June 2022
Stanford remote work expert Nick Bloom and his longtime collaborator Jose Maria Barrero recently conducted a survey to find out. The results should serve as a warning to leaders planning to simply strong-arm their teams into returning to in-person work. When Bloom and Barrero asked employees whether they had complied with their employers' in-person work requirements over the past week, an incredible 48.5 percent of those whose bosses want them in five days a week said no. Compliance rose gradually to 84.2 percent among those only required to be in the office one day a week.
Harvard Business Review:
The C-Suite Skills That Matter Most
14 June 2022
For a long time, whenever companies wanted to hire a CEO or another key executive, they knew what to look for: somebody with technical expertise, superior administrative skills, and a track record of successfully managing financial resources...(by Raffaella Sadun, Joseph Fuller, Stephen Hansen, and PJ Neal).
Read more at Harvard Business Review
Guardian TV (Nigeria):
Traders, consumers lament food inflation
11 June 2022
...round 7.5 percent. Energy prices have been driving the surge, with Russia's war in Ukraine further fuelling the trend. But higher inflation tends to have a bigger impact on low-income households. Xavier Jaravel from the London School of Economics discusses this.
Read more at Guardian TV (Nigeria)
The Economist (Online):
Stagnation nation: Britain’s productivity problem is long-standing and getting worse
9 June 2022
...Uncertainty about what is around the corner for Britain's firms is one explanation for this shortfall, but far from the only one. Financing is another. Anna Valero of the London School of Economics says that part of the problem relative to America may be that in Britain it is harder to raise the equity capital that supports risk-taking.
Read more at The Economist (Online)
IFS Podcast:
Highlight: The productivity problem
6 June 2022
This week, we speak to John Van Reenen, Professor of Economics at the London School of Economics, and expert on innovation, firms and productivity ...
MIT Sloan Management Review:
Is Starbucks’s Wage Increase a Shortsighted Strategy? What Experts Say
31 May 2022
… Most of the panelists (45%) disagreed that Starbucks's pay decision was shortsighted, many highlighting trends in wages. John Van Reenen, from the London School of Economics and Political Science, points to efficiency wage theory, suggesting that "raising wages can be beneficial for morale, retention, attracting better workers, etc."…
Read more at MIT Sloan Management Review
POID Press Release:
Smaller firms report growing risk of closure
26 May 2022
Small firms are more likely to report they are at risk of failing in recent months, amid growing concerns about challenges such as Brexit controls, the Ukraine crisis and energy price hikes.
Financial Times:
Green investment could help UK levelling-up, says think-tank
23 May 2022
Economic growth and help the government with its levelling-up agenda in poorer, low productivity areas of the UK, a study has found. The report, titled Growing clean and published on Monday by the Resolution Foundation and London School of Economics, said green investment could contribute to the UK's future prosperity...
POID News:
American Economic Association Announces Award Recipients for 2022
23 May 2022
Congratulations to POID Director Professor John Van Reenen who received The Foreign Honorary Members award presented to foreign economists of distinction. Honorees are elected by the American Economic Association's Executive Committee upon recommendation from the Honors and Awards committee.
LSE Business Review:
Improving productivity through better management practices
20 May 2022
Up until recently, economists studying productivity lacked any robust way to quantify basic aspects of management practices. By creating the World Management Survey (WMS), John Van Reenen, Nicholas Bloom, and Raffaella Sadun offered the first robust evidence on the wide range of management quality across firms and countries, and on the relationship between management practices and productivity. Their research provided evidence for designing industrial strategies to tackle low productivity.
Read more at LSE Business Review
Gov.uk:
Green jobs delivery steps up a gear
11 May 2022
The Delivery Group will be made up of over 20 representatives from business. Ministers from various departments including Minister for Employment Mims Davies, Minister for Apprenticeships and Skills Alex Burghart, and Minister for Nature Recovery Rebeca Pow will also join the Group. Those attending the inaugural meeting were: Anna Valero, ESRC Innovation Fellow, Centre for Economic Performance and Diffusion, LSE (Associate Grantham Institute)
The Times:
If this is building back better, you’d hate to see worse
8 May 2022
In an Economy 2030 report recently — Enduring Strengths: Analysing the UK’s current and potential economic strengths, and what they mean for its economic strategy — there was some encouraging news. A new strategy is certainly needed, it says, but it needs to be based on reality.
The Times:
It’s time to take a firmer grip on companies and competition law
25 April 2022
That's why a set of papers titled "Firms and Inequality" published last month as part of the IFS Deaton Review of Inequality in Work, led by John Van Reenen, professor at the London School of Economics, is so important. We decided early on that to understand what is happening to inequality between people - the thing we care about in the end - we need to understand the behaviour of, and inequality between, firms. And my goodness how revealing that was.
Esglobal:
El límite de la innovación
8 April 2022
..in recent years this law has shown signs of stagnation. We need more and more researchers to keep it true. This is a phenomenon that has been pointed out by authors such as Nicholas Bloom, Charles I. Jones and John Van Reenen, for whom the productivity of research is declining. It is not absurd to think, therefore, that at some point Moore's law is destined to lose its truth value.
BBC Radio 4:
The end of invention
28 March 2022
Interview with Nicholas Bloom, mentioning CEP research, "Are Ideas Getting Harder to Find?" (Nicholas Bloom ,Charles I Jones, John Van Reenen, Michael Webb), CEP Discussion Paper No 1496, September 2017.
Listen to the interview at BBC Radio 4
LSE Business Review:
Do management practices matter in further education?
14 March 2022
Better management practices in further education colleges could help students from disadvantaged backgrounds. This is a pertinent issue as the share of students from disadvantaged families enrolling straight after GCSEs is about twice what it is in other educational settings. Improving college management practices could reduce inequality and improve social mobility, write Sandra McNally, Luis Schmidt, and Anna Valero.
Read more at LSE Business Review
Gli stati generali:
Can industrial policy restart from the ceramic district?
11 March 2022
Even at the empirical level, especially after the catch-up experience of China and South Korea, the debate is reorienting, as demonstrated by a recent proposal by MIT economist John Van Reenen that points precisely to this.
Read more at Gli stati generali
India Education Diary:
LSE: Better Management Practices In Further Education Colleges Boost Attainment Of Students From Disadvantaged Backgrounds
8 March 2022
The research – Do Management Practices Matter in Further Education? – published today by the Centre for Vocational Education Research (CVER) at the London School of Economics and Political Science, shows that good management practices matter in general and have a greater impact on low-income students than on their wealthier peers.
Read more at India Education Diary
Yahoo! finance:
Rise in 'superstar firms' pushing up wage growth inequality
3 March 2022
"The most important economic problem for the UK since 2008 has been dismal productivity growth, which in turn has led to pitiful pay increases", said one of the report authors, professor at LSE John Van Reenen. "Only in a relatively small number of firms, employing a minority of the UK's workforce, have productivity and wages improved in the past quarter-century."
VoxEU CEPR:
Misallocation explains worse management among Mexican firms
25 February 2022
By Nicholas Bloom, Leonardo Iacovone, Mariana Pereira-Lopez, John Van Reenen. The implications of poor management in developing countries are becoming well known, but what drives these differences is less clear. Based on large new surveys in Mexico and the US, this column argues that misallocation is a key driver of these differences. Frictions from low competition and weak rule of law appear to lie behind the difficulties even well-managed firms in Mexico have in growing, especially in the services sector. These results point to the importance of open and contestable markets, improving contract enforcement, and lowering crime and corruption as key mechanisms to improve firms' management and productivity.
CEP in Parliament:
Chancellor refers to LSE research on productivity in the UK
25 February 2022
The Chancellor mentioned LSE research in his Mais Lecture 2022 related to productivity. The research is part of the Economy 2030 work taking place at LSE through the Centre for Economic Performance (CEP). The Business Time paper in the series shows that "lower capital per hour worked is perhaps the single biggest explanation for our productivity gap with France and Germany, accounting for around half".
Read more at The Resolution Foundation
International Business Times:
Smaller businesses have been digitizing operations slower than larger companies. But that is changing fast
14 February 2022
Businesses of all sizes are adopting these new technologies due to the efficiencies they provide and, during the pandemic, out of necessity. For example, a survey by the Centre for Economic Performance found that over 60% of UK firms have invested in new digital technologies such as cloud computing and remote working, and around 40% have adopted digital capabilities like e-commerce and advanced analytics.
Read more at International Business Times
Economics Observatory:
Firms' digital innovation in the pandemic: how have workers been affected
3 February 2022
By Anna Valero, Capucine Riom, Juliana Oliveira-Cunha. The Centre for Economic Performance (CEP) and the Confederation of British Industry (CBI) have conducted two bespoke business surveys, the first in July 2020 and the second a year later, to generate timely data on the extent, nature and effects of technology adoption in response to the crisis.
Read more at Economics Observatory
MIT Sloan:
Want better forecasts? Start with better management
2 February 2022
In a working paper for the National Bureau of Economic Research, John Van Reenen, a digital fellow at the MIT Initiative on the Digital Economy, shows that well-managed firms make better forecasts — and the traits of those well-managed companies might come as a surprise.
Labour Research (Magazine):
When AI rules the workplace
1 February 2022
The Covid pandemic has spurred three-quarters of firms to adopt new technologies, according to recent research by the London School of Economics' Centre for Economic Performance (CEP) and the CBI business confederation. The joint research, The business response to Covid-19 one year on: findings from the second wave of the CEP-CBI survey on technology adoption, is based on a July 2021 survey of 425 UK firms.
Read more at Labour Research (Magazine)
Project Syndicate:
The Pandemic and Our Broken Social Contracts
21 January 2022
Similarly, a society that empowers high-potential children from underprivileged communities will reap significant rewards in innovation. Research from LSE's Centre for Economic Performance indicates that if talented children from poor families – "Lost Einsteins" – sought patents at the same rate as similarly talented children from rich families, innovation in the US could quadruple.
Read more at Project Syndicate
VoxEU CEPR:
Tracking business dynamism during the COVID-19 pandemic: New cross-country evidence and visualisation tool
17 January 2022
Stefano Agresti, Flavio Calvino, Chiara Criscuolo, Francesco Manaresi, Rudy Verlhac. Business dynamism is key for creative destruction and to foster resource reallocation – both crucial elements of long-run economic growth. This column uses a new data visualisation tool to reveal large sector- and country-level heterogeneity in the impact on business dynamism of the COVID-19 crisis in 2020 and in recovery. Initially, firm entry fell sharply in all countries, but the pace of recovery varied across countries. Bankruptcies fell and remained below pre-crisis levels well into 2021. The tool allows users to monitor the evolution of key indicators over the recovery period, keeping track of sector-specific patterns.
VoxEU CEPR:
Opening the black box of hospital mergers
16 January 2022
Martin Gaynor, Adam Sacarny, Raffaella Sadun, Chad Syverson, Shruthi Venkatesh. Despite the current wave of US hospital mergers, it is unclear how they change behaviour and performance. This column 'opens the black box' of hospital practices by analysing a mega-merger between two for-profit chains.
IGL:
Lessons on designing tech RCTs with SMEs
12 January 2022
By Capucine Riom, Anna Valero and Juliana Oliveira-Cunha. How can we help small and medium-sized businesses improve their productivity? New technologies based on artificial intelligence - such as chatbots and marketing automation - seem to offer clear benefits but are not yet widely adopted by SMEs. Alongside the Greater London Authority, Capital Enterprise and CognitionX, we designed a randomised trial to investigate how to encourage SMEs in London's retail and hospitality sectors to adopt the use of these technologies.
Borsen:
Stor inflasjonsfrykt - En katastrofe /Great fear of inflation - A disaster
12 January 2022
Brexit is an ongoing disaster. Regulatory deviations with the EU will continue to create lower trade and ultimately lower living standards. Our predictions before the referendum unfortunately turned out to be foresighted, says John Van Reenen, professor at the London School of Economics.
Sunday Mail (Online):
Hire people on merit, and half your problems are gone
8 January 2022
Recruitment and selection of people leads to a better organisational performance. According to a research by McKinsey (2007), in conjunction with the Centre for Economic Performance at the London School of Economics, and partners from Stanford and Harvard universities (2007), better managed firms report higher productivity and resilience to adverse economic swings.
Read more at Sunday Mail (Online)
Express (Online):
Boris warned further school closures would have 'permanent scarring effect' on children
4 January 2022
Professor John Van Reenen of the London School of Economics (LSE) said that kids are unlikely to make up for the lost learning that occurs as a result of school closures. He also said children from disadvantaged backgrounds are likely to be impacted more severely.
Financial Times:
FT economists' survey: people to feel worse-off as inflation and tax rises bite in 2022
3 January 2022
Richard Davies, director, Economics Observatory: We may see some short-term outperformance, due to strong vaccine take up. With Omicron fast on the rise, H1 of the year looks likely to be held back by lockdowns. Swati Dhingra, Associate professor, London School of Economics: UK's got the added impact of Brexit over and above the global trends. So lag behind. Steve Machin, professor of Economics and director, Centre for Economic Performance, London School of Economics: Lag behind, because it faces the same global trends, but has additional factors restricting growth including the continued effects of Brexit. John Van Reenen, School professor & director, POID, London School of Economics: Lag behind — the impact of Brexit (especially on services) will hold us back.
Amwaj Media:
UK girds to strike free trade deal with the GCC
22 December 2021
John Van Reenen interviewed for this article... At the beginning of October, the UK launched a 14-week consultation process largely seen as preparation for a free trade deal with the Gulf Cooperation Council (GCC). The formal negotiations with GCC member states (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates) are scheduled to start in 2022.
The Telegraph:
The chips are down: how tech's innovation crisis threatens global economy
20 December 2021
"Moore's Law is not like a law of nature, it comes from the fact that Intel and other companies put masses and masses and masses of money into research in order to get that continuous improvement," says John Van Reenen, a professor at the London School of Economics. "It becomes harder and harder to push out that frontier of knowledge."
AEI.org (blog):
It’s always a good time to be thankful for economic growth
6 December 2021
As economist John Van Reenen wrote earlier this year: Growth is not simply getting bigger. Increasing GDP by having a bigger population, or increasing working hours, is not obviously a desirable thing. What we need is productivity growth. Productivity measures how much more output can be generated per input, for example GDP per hour worked. History shows us that wage growth follows productivity growth over the long run. More productivity is like growing the economic pie: it gives us choices to spend more on public service, environmental protection, redistribution or private goods. (Please check out a podcast chat I had with Van Reenen in 2020 for my "Political Economy" podcast.)
Project Syndicate:
The Keys to Inclusive Growth
25 November 2021
The COVID-19 pandemic has highlighted major weaknesses of both the US and European models of capitalism. In the United States, the crisis has shown the limits of an economic system that fails to protect individuals against the effects of creative destruction and the social consequences of a macroeconomic shock.
Read more at Project Syndicate
LSE Business Review:
COVID-19 spurred a wave of new technology adoption by UK businesses
22 November 2021
The pandemic spurred three-quarters of firms to adopt new technologies, and businesses are keen to continue with this innovation mindset, which could be harnessed to fulfil the UK’s net zero commitments. Anna Valero, Capucine Riom and Juliana Oliveira Cunha find that the innovation response was stronger among larger and more digitised firms, potentially creating a lasting impact on the UK’s digital divide.
Read more at LSE Business Review
The Economist:
Britain’s economy does not lack oomph, but productivity is lagging
20 November 2021
Other measures of dynamism are looking up, too. Joint research from the Centre for Economic Performance and the Resolution Foundation, two think-tanks, analyses the Decision Maker Panel, a survey of British companies. It suggests that financial officers expect the reallocation of workers from shrinking to growing companies (a measure of dynamism) to speed up in the coming year. A different business survey found that by July this year over 60% of companies had engaged in product innovation and nearly 70% had adopted new management practices. Since productivity increases when people and stuff are used more effectively, all this bodes well.
The Telegraph:
I don't like Mondays-or Fridays: City workers decide three days a week in the office is enough
19 November 2021
John Van Reenen, a professor at the London School of Economics who studies productivity, agrees. "Of course there are things like brainstorming, having meetings and meeting clients that are better done in the office, but many people also spend lots of time during their day doing things like answering emails and that it is just as efficient to do from home," Van Reenen says.
Doorbraak.be:
Concerns about Glasgow
13 November 2021
Firstly, we must realise that the development of green technologies benefits from an economic environment that stimulates innovation in general. For example, economists Nicholas Bloom, John Van Reenen and Heidi Williams point out that the government can encourage innovation by the private sector by tax-favourable treatment of business investment in innovation, and by awarding grants and prizes for development by the private sector.
LSE Business Review:
How new technology can help clinical quality, productivity, and the healthcare workforce
10 November 2021
Health information and communication technology (HICT) holds enormous potential to improve productivity. Several countries, the UK and the US included, have embraced this idea and spent billions of dollars on promoting HICT adoption. Ari Bronsoler, Joe Doyle, and John Van Reenen reviewed 975 papers in the medical and economics literatures about HICT and found that on average there are major positive effects on patient outcomes and healthcare productivity.
Read more at LSE Business Review
The Atlantic:
America Needs a New Scientific Revolution
05 November 2021
Since 1970, the number of years the average Ph.D. student in the biosciences spends in graduate school has grown from a little more than five years to almost eight years. Producing experts is taking longer, and those experts are getting less productive. In the famous paper “Are Ideas Getting Harder to Find?,” the Stanford University economist Nicholas Bloom and his colleagues found that research productivity has declined sharply across the board since the 1970s.
POID Press Release:
Wages of the typical UK employee have become decoupled from productivity
03 November 2021
POID research finds self-employed have suffered even worse wage growth than other workers.
Research Professional News:
Budget failed to join the dots on key challenges
03 November 2021
Chancellor missed a chance to link innovation, net zero and levelling up, says Anna Valero. Chancellor Rishi Sunak’s autumn budget painted an upbeat view of the economy. Improved forecasts have left the Treasury with more money than expected. The decision to spend rather than cut taxes should help to repair public services that were under strain even before the pandemic.
Read more at Research Professional News
Telegraph India:
More hot air: stock market surge
02 November 2021
Using data collected from 8,000 big daily moves across 19 national stock markets, a 2021 NBER working paper by the Stanford and Chicago economists, Scott Baker, Nicholas Bloom, Steven Davis and Marco Sammon, shows that this Indian bull run may, indeed, be an outcome of international spillover of market irrationality.
CBI:
CBI@10am - Analysing the Chancellor's budget
28 October 2021
Dr Anna Valero joined Rain Newton-Smith and Yael Selfin to dicsuss the Autumn budget and give an overview of key announcements.
MIT Technology Review:
An uber-optimistic view of the future
27 October 2021
John Van Reenen, an economist at the London School of Economics and MIT, and his collaborators have shown that research productivity itself is slowing as “new ideas get harder to find.” At the same time, the US and many other Western governments have decreased their support for R&D as a proportion of GDP over the last few decades; in the mid-1960s, US federal R&D funding relative to GDP was three times what it is today. The US doesn’t have to return to such high levels, he says, “but standing still is not an option.” That would, says Van Reenen, cause TFP growth and economic progress to stagnate.
Read more at MIT Technology Review
Project Syndicate:
The G20's Vaccine Imperative
27 October 2021
The world's richest countries are sitting on a vaccine stockpile of unused doses that are surplus to their requirements, whereas only 5% of Africa's population has been fully vaccinated. World leaders gathering in Rome for the G20 this month must address this catastrophic market and moral failure. This commentary is signed by: Philippe Aghion Professor of Economics, Collège de France & LSE.
Read more at Project Syndicate
UK Today News:
Winner takes all investing
26 October 2021
John Van Reenen’s paper “Increasing Differences Between Firms: Market Power and the Macro-Economy” does an exceptional job of making the empirical case for Arthur’s point. He points out that there has been a notable increase in the concentration of almost all US industries, in terms of share of sales and employment at the top firms, over the past few decades. Here for example is his chart of shares of sales and employment of the top four (“CR4”) and top 20 (“CR20”) companies in industries in the services sector.
HBS Working Knowledge:
What Companies Want Most in a CEO: A Good Listener
26 October 2021
Financial expertise and operational experience will only take executives so far. More than ever, companies want senior leaders with strong social skills and emotional intelligence, says research by Raffaella Sadun and Joseph Fuller.
Read more at HBS Working Knowledge
Financial Times:
Winner takes all investing
25 October 2021
John Van Reenen’s paper “Increasing Differences Between Firms: Market Power and the Macro-Economy” does an exceptional job of making the empirical case for Arthur’s point. He points out that there has been a notable increase in the concentration of almost all US industries, in terms of share of sales and employment at the top firms, over the past few decades. Here for example is his chart of shares of sales and employment of the top four (“CR4”) and top 20 (“CR20”) companies in industries in the services sector.
ICAEW:
Carbon Crunch: “Net zero will be a major driver of economic change”
25 October 2021
In advance of the government’s recently published ‘Net Zero Strategy’, the Resolution Foundation and the Centre for Economic Performance at the London School of Economics (LSE) published ‘The Carbon Crunch’, a report exploring the economic policy questions arising from the need for the UK to shift to a net zero economy.
VoxEU:
ECB monetary policy and catch-up inflation
14 October 2021
Moving to a 2% symmetric target does not feel like a big enough change to shift inflation expectations, which is ultimately what the ECB is trying to do. Introducing an average inflation target would be a bit more ambitious and would signal the desire for meaningful change.” In a similar vein, John Van Reenen (London School of Economics) argues that the “EC...
Buzzsprout Blog:
Emissions: Impossible? What does a Net Zero economy really look like?
10 October 2021
Dr Anna Valero - ESRC innovation fellow at London School of Economics - is a guest on 'Emissions: Impossible?' a podcast showcasing some of the most ground-breaking research and innovation in climate change, to reveal where the UK's strengths lie.
De Tijd:
Are superstar companies causing inflation after the pandemic?
2 October 2021
The disruption of the production chains is taking longer than expected, but that does not change the inflation picture, central bankers stated this week during the annual Sintra conference. Does the danger come from superstar companies deepening the digital divide with competitors during the pandemic?
Yahoo! UK:
Energy costs to remain high even after petrol crisis ends due to Net Zero
30 September 2021
Experts have warned that energy is likely to be a major drag on household finances for years to come even after the current and heating crunch eases. Transitioning the UK to ‘Net Zero’ - where the emits net zero - will cost British on average £1,500 over the next decade, the Resolution Foundation and the London School of Economics have said. Britain ha...
City A.M.:
Middle-income Brits to be hit for green homes
30 September 2021
Poorer households are the most likely to live in energy inefficient homes, compared to being the least likely in 2014, meaning they will have to cough up a relatively larger sum than wealthier Brits to green their homes, the Foundation found in a joint report with the London School of Economics. The government’s fis...
BusinessNewsWales:
The Opportunity for Software & IT Services SMEs to Compete in the Post-covid Environment
29 September 2021
SMEs addressing specific sectoral challenges, which may have previously been deemed non-critical, are now viewed as attractive solutions to improve margins and productivity. A survey of UK businesses conducted by the Centre for Economic Performance (CEP) and the Confederation of British Industry (CBI) found that that more than 60% of firms have adopted new digital technologies (such as remote working technologies or cloud computing) or new management practices since the start of the pandemic, and nearly 40% have invested in new digital capabilities (such as e-commerce or advanced analytics)
Read more at BusinessNewsWales
LSE Business Review:
How do internal communication flows change when a new CEO is appointed?
27 September 2021
CEO turnovers are significant organisational events that typically mark a discontinuity in firm strategy and operations. These likely changes are visible in internal communication flows. Stephen Michael Impink, Andrea Prat, and Raffaella Sadun study these flows in a novel way: they explore the evolution of internal communications metadata on emails and meetings for 102 firms that experienced a CEO change.
Read more at LSE Business Review
Wharton Research Data Services:
Wharton Research Data Services (WRDS) best paper awarded to John Van Reenen
27 September 2021
A Wharton Research Data Services (WRDS) best paper award has been given to John Van Reenen, director of the Programme on Innovation and Diffusion (POID), and his co-authors Sabrina T. Howell, of New York University, Jason Rathje, of the United States Air Force, and Jun Wong, of New York University, for their research into how the US Air Force improved innovation.
Read more at Wharton Research Data Services
The Economist:
Wave goodbye to the handshake
24 September 2021
Now Jose Maria Barrero, Nick Bloom and Steven Davis, three economists, find that 19th-century mores are back. As part of a long-running survey of American business practices they find the handshake is out, especially among women: 62% now prefer a verbal greeting, up from less than 30% before covid-19.
The Irish Times:
Global economy needs Marshall Plan for Covid, climate change – economist
14 September 2021
The global economy needs a new Marshall Plan to fight the fallout from Covid-19 and place green technology at the centre of energy, transport and food production systems, according to economist John Van Reenen.
Market Place:
For the economy, 9/11 was "the first ripple in a series of uncertainty shocks"
10 September 2021
It's that uncertainty Nick Bloom and Brock Blomberg are talking about. The not-knowing for businesses and governments and us. And 20 years of that
The Edge Markets:
My Say: Economic growth and a societal merdeka of our spirit
9 September 2021
In a recent book, The Power of Creative Destruction, French economist Philippe Aghion and his two co-authors make the point that while it is common to see lower-income countries transitioning towards becoming middle-income countries, the next step in the transition is far too rare. An International Monetary Fund paper in 2019 makes the point that between 1960 and 2014, only 16 out of 182 economies globally reached high-income status. This is, as the term is commonly known, the so-called middle-income trap.
The Guardian:
As the UK economy bounces back, do we sceptics need to say we got it wrong?
1 September 2021
Mandatory reading in this context is the UK's decisive decade report, the UK Economy 2030 project launched jointly by the LSE's Centre for Economic Performance and the Resolution Foundation. Britain has to invest hugely and cleverly this decade to level up and achieve net zero, it argues, but it has the ball and chain around its economy of Brexit and low productivity.
The Daily Telepgraph:
Don't bet British staff will replace migrants
31 August 2021
From the Migration Advisory Committee report in 2014, which found migration actually helped to boost job numbers in Britain, to the London School of Economics assessment published right before the Brexit referendum that found lower wages were more strongly linked to the financial crash than immigration, the argument that a migrant's job comes at the cost of a native workers' opportunity has proven a difficult one to stack up.
Read more at The Daily Telegraph
Japan Economic Foundation (Newspaper):
Digital Transformation and Innovation: the Impacts of Covid-19
31 August 2021
Moreover, a July 2020 survey for the United Kingdom suggests that many firms that adopted digital tools and processes during the pandemic expect to maintain these post-crisis ("The Business Response to COVID-19: the CEP-CBI survey on technology adoption" by Capucine Riom and Anna Valero, A CEP COVID-19 Analysis, Paper No. 9, Centre for Economic Performance, London, September 2020).
Read more at Japan Economic Foundation (Newspaper)
Forbes India:
Rethinking capitalism: The power of creative destruction
31 August 2021
In The Power of Creative Destruction, economists Philippe Aghion, Céline Antonin and Simon Bunel argue that abolishing capitalism is not the solution. Historically, a market economy has proved to be a formidable engine of prosperity, enabling societies to develop in ways that were unimaginable even two centuries ago. However, market forces cannot be given free rein. The state and civil society both have a role to play in guiding the forces of disruptive innovation that underpin growth.
Public event
European Association for Research in Industrial Economics (EARIE) 2021
27-28 August 2021
POID Director John Van Reenen chaired and presented in a plenary panel discussion on “the Role of the State in the Post COVID Economy” at the 2021 Annual European Association of Research in Industrial Economics (EARIE) conference on August 28th in Bergen, Norway. Star speakers included Philippe Aghion (LSE and College de France), Wendy Carlin (UCL), Betsey Stevenson (Michigan) and Monika Schnitzer (Munich). The presentations covered thinking of a new framework for economic policy, industrial policy, the “knife edged” nature of economic policies actually enacted, how economists could be more influential, the risks of an over-extended industrial policy, the complementarity between policies towards growth and equality and the need for a new Marshall Plan to help the world recover from COVID.
- Wendy Carlin: The role of the state in the economy after Covid-19
- Philippe Aghion, Celine Antonin and Simon Bunel: Rethinking capitalism and the role of the state in Europe post-Covid
- John Van Reenen: The Covid recovery and beyond: going for growth
Express Online:
Furlough scheme draws to an end from next week - Rishi Sunak’s changes explained
26 August 2021
A survey undertaken by the London School of Economics (LSE) recently showed around one in every 16 businesses across the UK state they are at risk of closure over the next three months.
LSE British Politics and Policy Blog:
UK business confidence has increased – but the removal of furlough, possible new variants, and localised spikes in infections still pose risks
26 August 2021
The number of UK firms at risk of bankruptcy has more than halved in the last six months, while only 6% of all registered businesses say they are at risk – the lowest since September 2020. However, Peter Lambert, Apolline Marion, and John Van Reenen write that the removal of government support, possible new variants, and the ever-present risk of localised spikes in infections could make the rest of 2021 a quite volatile period.
The Observer:
As the economy bounces back, do we sceptics need to say we got it wrong?
22 August 2021
Byline: Will Hutton. Mandatory reading in this context is the UK's decisive decade report, the UK Economy 2030 project launched jointly by the LSE's Centre for Economic Performance and the Resolution Foundation. Britain has to invest hugely and cleverly this decade to level up and achieve net zero, it argues, but it has the ball and chain around its economy of Brexit and low productivity.
VoxEU:
Labour market reallocation in the wake of Covid-19
13 August 2021
Lena Anayi, Jose Maria Barrero, Nicholas Bloom, Philip Bunn, Steven Davis, Julia Leather, Brent Meyer, Myrto Oikonomou, Emil Mihaylov, Paul Mizen, Gregory Thwaites. The Covid-19 pandemic hit some firms and sectors especially hard. As economies bounce back, a key question is whether the recovery will re-employ all of the workers shed during the downturn, and whether they will go back to similar jobs.
Imphal Free Press:
How social sciences can help fight COVID-19 and build back better
9 August 2021
A recent report by the Centre for Economic Performance and Grantham Research Institute on climate change and Environment emphasizes the importance of involving business and communities in developing a strategy for inclusive and sustainable recovery. A "better "post-recovery world will undoubtedly also benefit from the well-documented contributions that social sciences make in areas such as improving the resilience of our democracies and financial systems, exposing and addressing social and economic inequalities and promoting good mental health and more sustainable ways of living.
Read more at Imphal Free Press
Financial Times:
Why do some inventions take so long to arrive?
6 August 2021
Other obstacles are more subtle. Researchers at the Opportunity Insights project have analysed the phenomenon of “lost Einsteins”: young people (often girls or those from ethnic minorities or low-income families) who were discouraged because they never had an inventor as a role model.
Reuters:
Respond, Recover, Rejuvenate: How technology will drive SMB recovery
30 July 2021
These companies comprised 99.3 percent of all U.K. businesses, according to the National Federation of Self Employed & Small Businesses. Worryingly, however, by January 2021 more than one in seven U.K. businesses faced “imminent closure,” according to the Centre for Economic Performance (CEP) and the Alliance for Full Employment (AFFE).
VoxEU CEPR:
Let me work from home, or I will find another job
27 July 2021
Jose Maria Barrero, Nicholas Bloom, Steven Davis. Employers in the US are grappling with whether and how to bring employees back to the office or other place of work. Using survey-based evidence, this column finds that four in ten Americans who currently work from home at least one day a week would seek another job if employers require a full return to business premises, and most workers would look favourably on a new job that offers the same pay with the option to work from home two or three days a week. High rates of quits and job openings in recent months appear to partly reflect a re-sorting of workers based on the scope for remote working.
Investors' Chronicle:
The economy's long Covid
26 July 2021
Fortunately, though, we have some reasons for hope. One is that entrepreneurs tend to be over-optimistic which means new ones will start businesses even if older, debt-encumbered firms close. Stanford University's Nick Bloom and colleagues show that people working from home report that their productivity has risen slightly. MPC member Jonathan Haskel adds that working from home might increase potential output in another way - by enabling some of those outside the labour force because they are carers or disabled to take up work. And, he adds, investment in intellectual property has held up well during the pandemic. Given that it has big spillovers - one companies' knowledge benefits others - this too augurs well for future growth.
Read more at Investors' Chronicle
New York Times:
We Are Leaving ‘Lost Einsteins’ Behind
21 July 2021
In “Lost Einsteins: How exposure to innovation influences who becomes an inventor,” Alex Bell, Raj Chetty, Xavier Jaravel, Neviana Petkova and John Van Reenen, economists at U.C.L.A., Harvard, the London School of Economics, the U.S. Treasury and M.I.T., argue: ‘Children at the top of their 3rd grade mathematics class are much more likely to become inventors, but only if they come from high-income families.
FE News:
80% of managers in the UK have little to no training - Debunk the leadership myth and eliminate the ‘Accidental Manager’
19 July 2021
2017 research from the Centre for Economic Performance at the London School of Economics found that four out of five of employees who are promoted to managerial roles are not suitably equipped to cope with leading a team, and this problem was particularly prevalent in Great Britain, with the country scoring just 3.03 out of five for management best practice, behind the US (3.31), Japan (3.23), Germany (3.21) and Canada (3.14).
Parliament:
Treasury Committee - Jobs, Growth, and Productivity after Coronavirus
12 July 2021
On Monday afternoon, Dr Anna Valero, Senior Policy Fellow, at the Centre for Economic Performance (CEP), and Deputy Director of the Programme on Innovation and Diffusion (POID) gave evidence to the Treasury Committee for their inquiry on 'Jobs, Growth, and Productivity after Coronavirus'. They discussed the outlook for economic growth post-pandemic, the causes of the UK’s lower level of productivity compared to other advanced economies, the causes of the ‘productivity puzzle’ in advanced economies and the specific challenges faced by the UK, and how Government policy can boost growth.
All Africa:
Nigeria: Shaping the Covid-19 Response - The Role of Social Science
08 July 2021
A recent article by the LSE Centre for Economic Performance and the Grantham Research Institute on Climate Change and the Environment suggests that the involvement of businesses and communities in the post-pandemic world will allow communities re-open in a manner that is beneficial for communities that have been ravaged by the virus.
The Economist:
Covid-19 has persuaded Americans to leave city centres
07 July 2021
Nicholas Bloom of Stanford University and Arjun Ramani, a student at that university who will take up an internship at The Economist this summer, have now supplied some answers. They find the pandemic has persuaded Americans to move out of city centres. But they have not gone all that far.
VoxEU:
Capitalism after Covid: Conversations with 21 Economists
16 June 2021
As with Bretton Woods and with the Beveridge Report during WWII, the crisis generated by the Covid pandemic creates an opportunity to rethink our economic system. This new book offers the thoughts of 21 top economists representing most of the different fields of economics on the key challenges the world faces after the Covid pandemic.
- Raffaella Sadun: Management for the recovery: Promoting innovation and curbing the power of digital giants
- Philippe Aghion: Is ‘cutthroat’ capitalism more innovative?
- John Van Reenen: The Lost Einsteins
The Times:
Pandemic investment could lift output
02 June 2021
Another report by the London School of Economics found that companies have been innovating at a much faster pace than they would have done otherwise. In a survey of several hundred companies, it found that more than 60 per cent of businesses invested in digital technologies and new management practices between March and July last year. A total of 45 per cent said that they had introduced new products or services during the period and about 38 per cent had adopted new digital capabilities. Crucially, 90 per cent of companies that have innovated during the coronavirus outbreak said that the changes would persist into the future and about three quarters said that their innovations had boosted profitability.
Capucine Riom and Anna Valero, the report's authors, said: "The unique nature of the crisis has forced many firms to make rapid changes to their ways of working and to adopt new digital technologies or management practices considered to be productivity-enhancing in normal times. If such innovation persists, it could induce lasting impacts on business performance and productivity".
The Independent:
Almost three-quarters of a million businesses ‘at risk of failure over next three months', economists warn
04 May 2021
Warnings of widespread business failure comes in an analysis by the John Van Reenen and Peter Lambert, using the latest Business Insights and Impact survey.
Public event
Going for growth
08 February 2021
On the 8th of February 2021, POID, along with the Centre for Economic Performance, held an online public event on how the UK and the wider world can return to sustainable growth following the COVID-19 pandemic.
Pulling together the lessons of 30 years of work on technology, management and productivity, John Van Reenen argued that innovation is the key to rekindling our economies.
Public event
Technology and the labour market
16 December 2020
On 16 December 2020, the Centre for Economic Performance held a panel event to mark the 10th anniversary of Sir Chris Pissarides Nobel Prize for Economics. In 2010, Chris was awarded the prize for Economics for his work with Peter A. Diamond and Dale Mortensen for their analysis of markets with theory of search frictions.
This December event, Technology and the labour market, focused on how advances in artificial intelligence, robotics, biotechnology and other areas are bound to have ever greater impacts on jobs and the labour market and asked, How will the employment prospects and wages of different types of workers be impacted by these developments? Are jobs going to disappear?
LSE press release
New LSE innovation research programme to help boost UK productivity
21 August 2020
A new Programme on Innovation and Diffusion (POID) based at LSE and led by world-leading economist Professor John Van Reenen will be funded by £4m from the Economic and Social Research Council (ESRC), part of UK Research and Innovation (UKRI).
It is part of a £30m package of measures by the ESRC - its largest ever single investment - to help solve the UK's stagnating productivity, as well as boost wage growth and drive up living standards. This research, which will inform significant decisions by governments and business leaders, has become more pressing given the need to support economic recovery in the context of the COVID-19 pandemic.
POID is rooted in the argument that productivity growth rests ultimately upon two elements: innovation - ideas that are new to the world - and the diffusion of these ideas across the economy. ESRC is contributing £4m, while LSE is providing £1m. The programme will be led by Professor Van Reenen, OBE, who is Ronald Coase Chair in Economics at LSE, and an associate and former director of the Centre for Economic Performance.
He is renowned for his research on productivity, which looks into the causes and consequences of innovation for economic life, both in terms of 'soft' innovation such as changes in management practices and 'hard' technologies such as Information Technology and Artificial Intelligence.
His work shows how important innovation is for economic growth, what can be done to increase management quality and productivity, and how and why governments should support research and development.
Professor Van Reenen said: "For over a decade, Britain's economy has suffered from stagnating productivity and wages. We need to reignite innovation and diffusion to recover from this pandemic and the other headwinds beyond."
Professor Simon Hix, Pro-Director for Research at LSE, said: "We very much welcome the opportunity the ESRC has given LSE to apply cutting-edge research in the social sciences to help solve what is perhaps the UK's most difficult economic policy challenge of our times."
Separately from LSE's work, the ESRC investment also includes a new Productivity Institute based at the University of Manchester.
Science Minister Amanda Solloway said: "Improving productivity is central to driving forward our long-term economic recovery and ensuring that we level up wages and living standards across every part of the UK.
"The new Productivity Institute and LSE's innovative research will bring together the very best of our researchers, boosting our understanding of the different drivers of productivity and helping people and businesses earn more in every area of our economy."
ESRC's Executive Chair, Professor Jennifer Rubin, said: "The Institute at Manchester and the LSE research programme address what is arguably the UK's biggest economic challenge. This funding represents the largest economic and social research investment ever in the UK, befitting its enormous potential to improve lives for millions of people.
"The Institute and programme will address low productivity by traditional measures, but also go beyond these measures to explore wider issues, including variation across places and what can be done to improve productivity for the UK as a whole; the importance of delivering a low carbon economy; relationships between well-being, productivity and skills; and the need for new ways of measuring productivity in a changing economic, technological and environmental context.
"The aim is to ensure that advances in knowledge inform the significant decisions and interventions that policy makers, businesses and individuals must make to improve productivity, and to achieve the attendant improvements in wages and living conditions that doing so can drive."
These new investments align with ESRC's Delivery Plan, which names 'Transforming Productivity' within the Productivity, Prosperity and Growth priority area.
They also complement ESRC's existing investments in the Productivity Insights Network (PIN), the Enterprise Research Centre, the What Works Centre for Local Economic Growth, and the Productivity Outcomes of Workplace Practice, Engagement and Learning (PrOPEL) Hub, a multi-disciplinary hub at Strathclyde Business School.