Explaining the UK’s productivity slowdown: Views of leading economists Ethan Ilzetzki 11 March 2020 The UK has seen slow rates of productivity growth over the past decade, with output per hour and real wages no higher today than they were prior to the global financial crisis. This column reveals how nearly half of leading economists surveyed by the Centre for Macroeconomics point to low demand due to the financial crisis, austerity policies and Brexit as a major cause for this productivity slowdown. Despite this diagnosis, only a small minority of the panel believes that the solution lies in demand-side policy. Instead, a majority support promoting productivity growth through investments in education and worker training. Other policies, such as infrastructure investments, and tax and regulatory policies are also proposed.

a column by Ethan Ilzetzki (London School of Economics, UK) for VOX: CEPR’s Poicy Portal

The UK has seen slow rates of productivity growth over the past decade, with output per hour and real wages no higher today than they were prior to the global financial crisis.

This column reveals how nearly half of leading economists surveyed by the Centre for Macroeconomics point to low demand due to the financial crisis, austerity policies and Brexit as a major cause for this productivity slowdown.

Despite this diagnosis, only a small minority of the panel believes that the solution lies in demand-side policy. Instead, a majority support promoting productivity growth through investments in education and worker training. Other policies, such as infrastructure investments, and tax and regulatory policies are also proposed.

Continue reading and it is really worth your time. The answers might have changed since the survey was done in February but the charts will show why the UK was in a bit of a mess (my wording) economically before the virus really hit us.

Labels:
productivity, productivity_growth, productivity_slowdown, demand-side_policy,

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