Jonathan Price has been the Chief Economist to the Welsh Government since 2006. Prior to that he held various economist roles within the Welsh government covering all aspects of the economy in Wales including rural and agricultural issues. Before joining the Welsh Government, he worked for the Office of National Statistics.
This interview was conducted on 3 March 2022.
Q: Could you give us your overall assessment of the key successes and the key frustrations of driving growth in the Welsh economy over recent decades?
I’m an analyst, not a policy person. So my role, which I’ve held for about 16 years, is about assembling evidence, trying to understand why the Welsh economy performs as it does, and providing evidence to help people shape economic development policy in Wales. But the shaping of that policy is done by other people. It’s ultimately a politically driven process. That policy formation will reflect advice they get from economists outside government, from non-economists, and will reflect, of course, their own judgments.
One of the interesting things is if you look back at ‘Wales The Way Ahead’, published in 1967, is how many of the spatial problems are very similar. That document talks about the decline of traditional industrial areas, the decline of mining, which of course had been in decline for many years before that, but also the need to improve productivity, to create new jobs closer to where people live.
There was a large programme of support to manufacturers to set up in more deprived parts of Wales and indeed parts of the rest of the UK, driven by grants, programmes to improve transport links, those kinds of things. Actually very much the kind of things we still do. There’s a lot of continuity between policies through these different eras. Very often it can get branded rather differently, but it’s often a repackaging of many of the same elements. We still offer grants to firms. We still worry about transport links, although we’ve shifted in recent years to focusing on public transport due to environmental concerns. We still worry about poor productivity, we still worry about jobs, not enough jobs in the right places, we still worry about environmental issues. It’s interesting, looking back at the 1960s, that was an environmental concern then, though obviously not a focus on global warming, more on local environmental conditions. In short, there are big continuities.
What have been successes? Well, the first thing to acknowledge is how embedded the economy in Wales is in the wider UK context, and the importance for outcomes in Wales of redistribution through the UK tax and benefits system. This matters particularly because the variation between people’s outcomes is much greater than the variation that you get spatially between the regions of the UK. And therefore, I think it would be unrealistic in this broader context to expect transformation of the regional economic outcomes to be driven by policies within the regional economies themselves.
When you consider Wales or the regions of England, you have to bring into the picture the dominant, ‘attractive’ role of London and the South East. You can argue, and people like Philip McCann have argued, that to a large extent that has been policy driven. I’m pretty sceptical about that. It’s certainly true that the UK government has supported the financial services industries in various ways, but it is very hard to imagine any government not doing that, given the historic comparative advantage, the strength of London as a global city. I think it’s pretty fanciful to imagine that policy could have been anything other than supportive to some degree to London and the South East. And even if it hadn’t been, the sheer strength and dynamism of the economy there in recent years would have posed spatial challenges for the rest of the UK.
I think Wales has suffered particularly from not having a large city. It’s true that cities across the UK probably underperform compared to large cities on the continent, but large cities still have advantages. Although Cardiff is an attractive and successful city, it’s a small city, 350,000 people, not a large agglomeration. So we don’t have a Manchester or Leeds. As the economy’s restructured, again maybe pushed along a bit by policy, but mainly autonomously, towards the service sector, tradable services, knowledge intensive services, those have tended to be in larger cities. That’s been a headwind much of Wales has had to push against.
If you step back from that, what you see, if you look at the headline indicators of Welsh economic performance like GDP per head, since devolution, is not really much movement in GDP per head in Wales, relative to the UK as a whole. I used to work at the ONS, I’ve looked inside the sausage making machine, and I know how these statistics are made, and I wouldn’t want to over interpret small differences, so I think you need to look past small changes, up or down. But, overall, we’re obviously still one of the least successful parts of the UK in terms of GDP per head. That’s consistent with us having a skills mix which is less strong than the greater South East (but similar to northern England) and lacking a major city. Wales’ overall performance is no mystery.
If you looked at Wales in the UK context and you said, ‘Well it’s got a skills mix which is like northern England, not like London and the South East, or east of England or even the Southwest, it’s improved, but that’s where your benchmark is, and it lacks the agglomeration potential of a major city like Leeds or Manchester’, you’d say you’d expect GDP per head in Wales to be round about the bottom of the UK league table. That may sound unambitious, you might say, ‘God that guy has been advising the Welsh government for the last 12 years, it’s no wonder they haven’t done anything more impressive’, but I think it’s just almost inevitable given that UK context, that we are about where we are in the league table. Our skills mix and our lack of a major agglomeration, both of those things are amenable to policy, but only over the very long term. So you wouldn’t expect to see short term shifts.
So, where have the successes been? I think there’s been a big labour market success in Wales. If you look back to the period of deindustrialisation in the 1980s, and maybe even before that, we had a labour market performance that was uniquely bad in the UK context, perhaps Northern Ireland excepted. We had an employment rate which was lower than in the northern English regions, and that was largely driven by inactivity rather than unemployment. We had a big problem of inactivity, of ill health, premature quasi-early retirement, a very weak labour market, with a gap in employment rates between Wales and the UK as a whole of, typically, 5 to 6% points over the 1990s.
So, while the Welsh employment rate is still a little below the UK, and our inactivity rate a little higher, that’s kind of what you’d expect given that we’ve got a slightly older and slightly sicker population. But Welsh performance is no longer anomalous, and our labour markets performance now is better than a number of English regions. It’s been particularly good recently [at the time of our discussion]. Again I wouldn’t necessarily give weight to the most recent data because of the confidence intervals around the figures. But, in the round, there’s been a big labour market success story. If you want to link to well-being rather than GDP, we know having a job is really important. I think a wellbeing perspective would give a lot of weight to that positive labour market story.
What’s driven that? It’s very hard to say anything definitive. But it’s coincided with a move from us being notable for a much worse skills mix than most of the rest of the UK to one which is in line with or even slightly better than northern England. Given what we know about the general link between skills and labour market outcomes, that is the obvious explanation: there’s been an upgrading of the skills profile in Wales and that’s been reflected in a transformation in labour market outcomes. But it’s not reflected in GDP; we’ve held our own in GDP terms but we have weak productivity and low pay, offsetting the improved labour market performance.
Q: How do you explain the difference in the Scottish and Welsh trajectory on skills?
Scotland has got a much more favourable skill profile, a very high proportion of tertiary educated people in its population. I don’t quite know how they’ve achieved that but they certainly have. There are other specific factors about Scotland, on top of their very good skills profile. They’re agglomerated, so you’ve got two big cities, Glasgow and Edinburgh, and they’re quite proximate. They’re in the central belt, so commuting times between the two are under an hour. They’re effectively one large agglomeration and that’s one of the largest agglomerations in the UK outside London. Given what we know about the potential for agglomeration economies, even though they’re not guaranteed, I think it would be surprising if that wasn’t playing a factor.
In addition Edinburgh has had a successful financial services sector. Obviously, it had a big blip in 2008. Nevertheless it’s a high paid, relatively successful sector. Scotland has also benefited from oil – obviously oil isn’t credited to the Scottish economy in the National Accounts, but a lot of onshore activity that’s been related to oil, particularly in the North East, is credited to the Scottish economy and that also has boosted Scottish performance.
In summary, I think skills is a big part of the story, they’ve done well on skills, I don’t fully understand why their skill mix is so strong, and there are also other factors which explain why Scotland has performed better than Wales and some of the other English regions.
Q: What’s your evaluation of UK or Welsh government efforts to change industrial structure?
Quantitatively the effects have been modest compared to the underlying changes driven by ‘natural’ structural change. They’ve been successful to a point. If you look at the number of jobs involved, the What Works Centre for Local Economic Growth assessed that business support has made a positive contribution, but the numbers involved are small.
In terms of the ‘drivers; of industrial structure, the key question is what’s proximate and what’s distal? What’s the underlying causal structure here? You can use grants to move jobs around but will they stick if the underlying environment isn’t favourable? Evidence from the OECD suggests that the single most important factor in attracting and retaining high-skilled jobs is having a highly educated and skilled workforce, and then having agglomeration.
I tend to think that industrial mix follows these deeper structural factors, and attempting to tinker with industrial mix without changing these deeper structural things is probably likely to be unsuccessful. I’m not sure I’ve got completely compelling evidence on that. But we’ve seen that you can persuade a firm or industry to come and set up somewhere by incentivising them with a grant, and then they’ll come back and ask for another grant a few years later or they’re going to go. They need ongoing subsidy to overcome locational disadvantages. I think the evidence is that grants and other kinds of support can help but that you need to pay more attention to the underlying structural drivers of what make places locationally attractive or not.
Q: What’s the policy objective for regions that aren’t population-dense and are never going to be in a relatively agglomerated economy?
I’m not a policy person. What you have to say to people is, ‘It’s just difficult’. The policy is to try and get jobs to people, but people do choose to move away from certain places. That’s a problem but that’s also how the economy adjusts over time.
There are big cultural issues in parts of Wales, of course, because of the loss of people and the loss of language, lots of young people move away from more struggling rural areas. Not just in Wales, it’s obviously a UK, European, an international phenomenon, that young people tend to go to big cities.
And that isn’t necessarily a loss to Wales as a whole. Lots of young people will move to Cardiff from those areas of Wales.
In terms of North and North East Wales, they’re very much integrated into the North West of England regional economy and they have a functional role within that. Airbus is very important employer, situated pretty much bang on the border between England and Wales. There is a big, residual, but strong manufacturing base in North East Wales and obviously that’s very welcome and policy needs to seek to strengthen that.
Overall, I think you have to be realistic. Manufacturing is not going to create large numbers of jobs in the future. I think tourism and recreation is very important but again there are very big challenges because, like in a lot of English seaside towns, many Welsh resorts lost their traditional holiday markets. Places like Rhyl used to be a big major summer holiday centre for the English industrial areas. They’ve lost that role and those places are struggling. Trying to find a new role for those kind of places is a big challenge.
I think there has to be a continuing emphasis on leisure, recreation, but of a type that is more relevant to today’s market. But it takes quite a lot of money to repurpose some of these places where the built environment is really deteriorating.
Q: You said that new regional policies are often old policies repackaged?
There’s not much new in this space. You offer grants to businesses, you try and improve transport and communication, there’s ICT now not just physical transportation. You try and support research and development through the public sector and try to subsidise research and development in private activities to support innovation. All of these things have been going on for many years. You have incubator spaces. You try to encourage spinouts from universities. You try and encourage entrepreneurship. In pretty much every phase of policy in Wales those things have been done. The emphasis between them might change a bit, and the way they’re branded may change a bit, but it’s not all large new elements or that any of those things ever get completely dropped.
It’s certainly true that in the 1990s there was a big push on entrepreneurship, trying to encourage people to become more entrepreneurial, to start businesses and so on. We still do that but that’s attracted less emphasis in recent years because it was felt that a mass programme trying to encourage entrepreneurship probably wasn’t sufficiently targeted on the kinds of people that would become successful entrepreneurs. There are those kinds of shifts that are going on, but they’re within a constellation of the same stars.
Transport needs to be a continuing focus if you’re going to have someone who’s going to want to be an entrepreneur, because they need to have connectivity, to have people come to their business, that’s how they’re going to get their business out into the world.
The challenges may be more about finding ways to ensure policies are implemented effectively, rather than finding new policies.
Q: Are there other countries that have done it much better. Why has it has been difficult to deliver in Wales and the UK?
Is it delivered more successfully elsewhere? I think I’d want to see evidence of that.
It’s true that the UK is, and remains, a regionally very spatially imbalanced country. That is a genuine finding, but exaggerated somewhat by measurement issues. The way in which, for example, Paris enters as a single entity, and London is split up in some of the measures. When the ONS [Office for National Statistics] have tried to allocate regions based on their size rather than their arbitrary classification, they find spatial divergences between countries is somewhat less. When Chris Giles at the FT [Financial Times] looked at divergence based on functional economic areas, rather than formal classifications, again he finds the UK is less extreme.
But I don’t want to have to be misinterpreted on this. I do accept that the UK still is spatially extreme, towards the top of the international spectrum. I’m not challenging that. But I don’t think it’s quite as extreme as some of the work of Phillip McCann suggests, and I think in part it reflects high inequality at the individual level. If you have a UK economy in which individual inequality is very large, and, as know, people ‘sort’ spatially, it would be remarkable if we didn’t also have large spatial inequality. It’s almost inconceivable that you could have a country with high individual spatial inequality, a powerful attractor like London and the South East, and not have big differences between regions.
So I’m not as convinced as some people that this is a failure of policy at the regional level. If it is a failure, I think it’s to do with not correcting the spatial balance of the UK, and addressing individual inequality, rather than a failure of the application of the tools that are held at the regional level.
I can tell you one thing that would make a big difference straight away: if we had levels of tax and redistribution in the UK of a similar level to France or even Germany and certainly Scandinavian countries, individual inequality would fall and so, in consequence, would spatial inequality.
Q: What do you think of the debate about devolution and the case for greater fiscal federalism?
It’s a very fashionable idea of course. And almost by definition, devolved administrations must be in favour of decentralisation and devolution. However, I think there’s a danger of it being presented as a panacea, given the UK context. Both the integration of regional economies in the larger UK whole, and the importance of redistribution under the UK tax and benefits system, mean you could easily, if you’re not careful, further weaken the sense of solidarity on which a redistributive system ultimately depends.
What worries me tactically about the decentralisation story is that I think for politicians at a certain end of the spectrum, what might be quite attractive would be to say, ‘We’ve given you these tools out there in Wales, or Liverpool, or Manchester, now you solve the problem. We’re going to cut taxes, we’re going to cut welfare. We’ve given you the tools, don’t come crying to us about your problems with poverty and inequality.’ My worry, as highlighted by the OECD, is that decentralisation does work, but only in the context of a strong and redistributive tax and benefits system, and a strong welfare safety net. And my worry is that, in the political context we are in in the UK, decentralisation could be a cover for further reducing our levels of redistribution, which are already weak compared to other states.
My other worry about decentralisation is that, because of the integrated nature of the economy in much of England and Wales and possibly England, Wales and Scotland, it’s hard to know what is the right geography for decentralisation. In a larger country, with more clearly defined regional economies, I can see the case more strongly. I work for a devolved administration where our economy is very closely integrated into adjacent parts of England and our outcomes and where the performance of our economy will depend very much on that.
I would be worried as well about the dangers of zero sum, or negative sum gaming, where rather than creating genuine additions in economic activity, you pursue policies at the local level that simply chase mobile economic activity and try and bribe it to come to your area.
Q: Are there countries you look to that do this well?
I’m a bit of a policy sceptic, unfortunately. Going back to my original diagnosis, we ought to really pile in on skills and education, particularly for people from disadvantaged backgrounds. We need to find the interventions that really work and ensure they are applied universally. We ought to try to build up agglomeration and the efficiency of our transport systems and ICT. Get those basic structural things right. There’s a real danger of being distracted from those kind of things – because they’re difficult and long term – by quick fixes and the latest fashion in regional economics. ‘Smart Specialization’ or whatever the latest one is. I’ve seen waves of these come through in regional economics, they’re going to solve the underlying problems and they never do. They’re typically a rebranding of things that were done anyway.
There’s a danger of taking our eyes off things that we know really matter, not just for economic outcomes, but for well-being. The UK churns out a large number of people with very poor levels of skill, particularly the kind of non-cognitive skills which are difficult to inculcate and measure but which are increasingly important. Team-working ability, agreeableness, motivation, we’re really bad at doing that. I think a place that worked well would have a laser like focus on those kinds of things, and a scientific approach to identify the things that really work in addressing those problems and ensuring that they are socialised across the UK. That for me is what good would look like.
There’s a real danger in looking around the world and picking winners. In Wales we look at the Basque Country and say we want to be like that – and conclude that we need to apply the same policies. The problem is that you might very well find that other regions in Spain, like Galicia, have done very much the same things and haven’t been successful.
Taking the Basque Country example, many of the ‘fundamentals’ are favourable: they’re close to the French border – and all of the regions close to the French border do relatively well. The Basque Country had a bad patch in the 1980s but it had been a leading Spanish region for very many years before that. It’s got a very good mix of skills with lots of graduates. It’s got dense motorway networks. It’s got the fundamentals right. But very likely, you’ve got other regions in Spain pursuing the same, or very similar, policy mixes but without the same outcome. The outcome may reflect, not policy, but rather deeper structural factors.
So, I’m very nervous of picking winners. People always go back to the Basque Country, as just mentioned. A few years ago they used to look to regions in northern Italy – but then they didn’t do so well. Then people looked at Germany, because Germany apparently did well for a while. Now Germany probably won’t do so well for a while. I think looking at success stories, or trying to identify the policy that’s worked well based on examples, is really risky. You need to look at places where the policies didn’t work so effectively as well.
Getting the basics right. That’s what a successful region would be doing.
Q: What is the case for greater borrowing powers for Wales?
There are at least two reasons why you might want to borrow. One is to overcome temporary shocks, economic shocks, a short term fiscal stabilisation policy. I’m somewhat sceptical about that because although there might be slight differences in timing, the integrated nature of the UK economy means if there’s a fiscal shock in the UK, Wales will have a shock. And if there is a shock in Wales, the UK will be having a shock. So I’m not convinced that, for pure stabilisation reasons, borrowing would be much of a benefit. However, I can see the theoretical case.
How about in order to invest and develop the economy? There I think it could help. But the problem with borrowing is you have to pay it back. You have to ensure it was really spent in ways that generated a return. So it would help provided we could identify productive ways of spending the associated resources . What you’ve got to do first is find the things that you want to spend on and then make the case for borrowing -rather than the other way around.
Obviously politically we’ve got to make the case, because we’re a devolved administration and we think we should have those powers. That’s a political argument which I can’t comment on. But in terms of economic argument: Yes, provided you can identify worthwhile things to invest in.
Q: How significant has institutional reform been in Wales?
As already discussed, the labour market is possibly the most important outcome you can point to in terms of people’s well-being. There’s been a big change in probably the most important single indicator, the employment rate, and that was timed around the time of devolution and in the years following devolution.
It’s not a smooth trajectory. If you look at the Labour Force Survey data, there was a big step change in 2002 and 2003 in employment. But I think that’s a sampling thing. You smooth it over and you look over a run of years. Things started to turn around shortly after devolution, in terms of our labour market performance. But the attribution of causation is very difficult.
As already discussed, given the educational profile of the Welsh population, and the relative sparsity of our population and distribution of our settlements, there’s nothing perplexing about our overall economic performance. It would be perplexing if our economic performance was similar to Scotland’s, given that those fundamental structural drivers are different.
I wrote something a few years ago called, ‘Welsh Economic Performance – a Challenge not a Mystery’. That’s still right. It’s not a mystery. We perform about how you’d expect us to perform in the UK context, given the basic structural drivers that we have. Now we have the levers to address those structural drivers, and I think we have partly done so – they have been addressed in respect of skills to close some of the gap. Addressing things like agglomeration and further closing the gap on skills so that we look more like Scotland is really difficult. But outside that, it’s very hard to see the headline performance being much different. I know that’s going to sound like I’m lacking ambition, an account of despair, but I think it’s pointing to where we’ve got to do the hard work and keep it going over many years.
Q: Are there variations in public service delivery and welfare support in Wales? Might that be shaping the trajectory of the Welsh economy?
The differences on welfare are marginal because welfare isn’t devolved. We’ve supplemented welfare with things like free prescriptions and different approaches to student finance. But in the scheme of things, these are marginal differences. We don’t have the resources to supplement the UK welfare state to any marked degree. So, you wouldn’t expect large differences.
The steps the Welsh Government has taken would have improved the living conditions of certain hard-pressed families and individuals and that’s worthwhile. But given Wales’s fiscal deficit with the rest of the UK, the big picture is that we are almost wholly dependent on fiscal transfers, either through the Barnett formula or more broadly through the tax and benefit system, that we largely don’t control.
I’m going to pass on public services delivery because that’s a very controversial area where it is difficult to assess how far differences in outcomes reflect local context. Other people than me, from outside Wales, may be better placed to make a judgement on that. I think there’s very interesting work to be done on the comparative outcomes in health and education. I think there’s a relative success story for Wales in some areas of education, and particularly closing the gap with other parts of the UK.
I think it’s certainly worth looking at what the comparative outcomes in health and education are, comparing Wales with similar parts of the UK. No-one should ever compare Wales with England, or with the UK as a whole, because London and the South East is just so different. You should compare Wales with the North East of England, the North West. I don’t see strong evidence of large differences in outcomes, other than closing that gap in education. But I may be wrong.
Q: How can Wales do more to generate R&D, ideas and innovation?
Innovation is obviously crucially important to economic growth over the long run. But I’m again persuaded by arguments put forward originally by the OECD: that for regions which are not at the frontier, absorbing and applying innovation is much more important than seeking to come up with new ideas in the first place. It’s consistent with evidence from the US and elsewhere that the big productivity benefits from ICT come not from the people who first came up with the idea – although Bill Gates is obviously a wealthy person – or with the production of equipment. The big benefits come from the effective use and application of ICT.
I think the issue of innovation in a region which isn’t at the cutting edge in most areas – I’ll immediately caveat that, there are some areas where Wales is at the cutting edge, and our research institutions are world class, we should be supporting and promoting that – but in terms of the broader economy, it’s ensuring that we have policies that encourage the diffusion, absorption of ideas from other places and their application. That’s difficult. It’s often about the forces of competition, again it’s about linkages.
There is certainly a story you’ll hear from some people about Wales being a branch plant economy; there’s certainly an issue about Wales not having large, homegrown companies owned in Wales. Again to what extent that’s an artefact of deeper structural factors – lack of a large city, relatively small population – I’m not sure. But it’s certainly a proximate issue.
Branch plants are often not about being at the ‘cutting edge’ of innovation. But there’s also a large body of evidence which suggests that inward investment in the form of branch plants is actually good for pay and productivity. There’s also a lot of evidence that pay and productivity tend to be a bit higher in multinational companies, particularly American owned ones, for people doing equivalent work. There can also be spillovers from innovation by inward investors. So I think one needs to be a bit cautious in criticising the branch plant economy and inward investment.
Q: Do you have a quantitative sense on how diffusion or, absorption of technologies, has changed over time?
I have no reason to believe that it’s any different in Wales from the picture across the UK and the OECD more generally: there’s a problem, it has been slowing, that maybe companies at the frontier have continued to grow at historic rates but the diffusion machine is broken, that’s the story. If you look at what’s happened to headline productivity across the developed world, that must be true, and it must be true in Wales too.
There is obviously particular concern at the moment about being ‘left behind’ and inequality. But inequality hasn’t really changed very much since the 1980s. The big widening in inequality was in the 1980s, and it’s been pretty stable since then. In most recent years, maybe the top one per cent, or the top one tenth of the one per cent, has pulled ahead a bit. But the rest of the distribution hasn’t altered very much. And actually the bottom groups haven’t done too badly, partly because of the living wage and, at least until recently, because welfare has been relatively protected. That’s changing and we’re worried about that.
There’s not been any large growth in inequality, or growth in the numbers of people left behind on that measure. What’s changed is that the growth machine has stalled, we’ve had very sluggish growth for the last 15 years since the financial crash, and that’s been particularly true in Wales and in the UK – probably because of some self-inflicted wounds including excessive austerity in 2010 and Brexit-related uncertainty. But the big story is not one of growing inequality, or growing problems with people being left behind, it’s the failure of productivity and wages to grow across most of the distribution.
My suggestion is that being at the bottom of the pile is easier to bear if your income is growing over time, and if your kids have better prospects than you did. But when that growth machine fails, then being at the bottom is felt much more acutely. Because some people’s incomes will actually be falling in real terms at the bottom, not just staying still. I think the big story across Wales and the UK over the last decade or so is a failure of growth, not an increase in inequality or an increase in spatial disparities or anything like that. And that’s what’s driven the concerns about the left behind, and problems like the Brexit referendum vote.
Q: What is the level of knowledge sharing across the UK, around best practise and how does it compare to other countries?
I don’t know how it compares to other countries and I’m not really in the space of delivering economic policy. If I step outside economic policy and think about my experience in other aspects of economics, for example, I’ve been involved in various ‘invest to save’ programmes, and it does seem to me that there is a real problem about getting innovation generalised across the public sector. You see people reinventing things all the time. People come with projects to the invest to save panel – say to digitise some aspects of the health service, which, it turns out, people have already done elsewhere but there’s no mechanism to ensure it becomes standard practice.
There’s a lot wrong with the private sector, but fundamentally there are powerful mechanisms for socialising innovation – though admittedly this seems to have failed somewhat in recent years in terms of diffusion. If supermarkets fail to innovate, they get left behind and other supermarkets take their place. In the public sector, we don’t seem to have developed effective means for diffusion. There’s this problem in the private sector now, but my impression is that there’s at least as bad a problem in the public sector, probably worse. I have no idea whether that’s particular to the UK.
Q: What are your working relationships like with your counterparts in Scotland or Northern Ireland, or in Whitehall?
I’m part of the Government Economic Service (‘GES’), a Great Britain-wide network of economists. The GES recruits on the basis of common professional standards for economists. And connectivity is pretty good through that. If I want to know about what’s happening in some area of government economics, I can contact the relevant people. However, I think the extent to which this actually happens has naturally and for good reasons, reduced since devolution. Those kind of networks used to be stronger than they are now.
I’m not sure how they operate on the policy side, for people responsible for delivering policy, how networked that is and how good the learning is improving in that area. In so many areas, certainly in economic policy, determining what works is difficult because there are so many confounding variables, and historical dependencies, and changing contexts. The What Works Centre for Local Economic Growth, which reviews evaluations in different areas, found very few examples of high-quality evidence in most areas. Learning sounds like a good idea: learning from others and sharing what works. But people often have very strong views about what works, without there being much evidence underpinning that opinion. I’m quite sceptical about expert ‘opinions’ in such areas, including my own. That pushes me back to sticking to the things that we know really matter, where the evidence is really compelling, and getting those things right.
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