British Economic Performance Research Articles

The task ahead for Labour if it came to power

The task ahead for Labour if it came to power

EU Membership, Mrs Thatcher\u2019s Reforms and Britain\u2019s Economic Decline

This paper presents a dissonant view on post-war British economic performance. A defining feature is the decline of the UK relative to the six founding members of the European Union after 1945. However, this relative decline stopped. The conventional view is that a turning point occurs in the mid-1980s when Mrs Thatcher implements far-reaching structural reforms. This paper asks whether econometric evidence supports this conventional view and finds it does not. We then examine an alternative hypothesis: this turning point occurs around 1970 when the UK joined the European Community. We find strong econometric support for this view. The intuition we offer is that EU membership signalled the prominence of business groups that chose to compete at the high-tech end of the common European market against those business groups that preferred comparative advantage-driven Commonwealth markets (mostly former colonies). Those pro-Europe business groups later become the constituency that provides support for Mrs Thatcher’s reforms. Without this vital support, we argue Mrs Thatcher’s structural reforms would not have been nearly as effective, if proposed and implemented at all.

Balanced Accounts? Constructing the Balance of Payments Problem in Post-war Britain

This article re-assesses the character of the balance of payments ‘problem’ experienced by Britain in the 1950s and 1960s, and how it was represented in contemporary policy discussion and pronouncements. It argues that this problem had little to do with any underlying ‘decline’ in British economic performance, but rather reflected the ambitious foreign policy ambitions of contemporary governments. This problem of ‘overstretch’ presented formidable presentational challenges for these governments, which resulted in the issue being portrayed in a misleading perspective that historians need to correct.

Whatever Happened to the Balance of Payments ‘Problem’? The Contingent (Re)Construction of British Economic Performance Assessment

This article analyses the changing political significance of UK balance of payments assessment in the post-war era, seeking to explain its disappearance as a policy issue today. We demonstrate the historically contingent nature of balance of payments performance assessment by comparing its shifting, conjunctural, constructions, rooted in underlying political economic assumptions, across four periods in the 20th and 21st centuries. We argue that the political salience of UK balance of payments assessment is contingent upon structural changes (both ideational and material) within the global political economy and domestic politics. Changes in the prevailing policy paradigm through which balance of payments was interpreted (for example from ‘embedded liberalism’ to neo-liberalism), and redefinitions of balance of payments assessment techniques, both of which happened on numerous occasions in the post-war world, had the effect of reshaping the nature of the external international political economic constraints to which UK governments were subjected.

The British Economy in the Twentieth Century. By Alan Booth. New York: Palgrave, 2001. Pp. x, 244. $65.00.

Alan Booth has produced a textbook for (British) first-year undergraduates, the traditional structure of which belies its passionate motivation. It was “written in a mood of growing disenchantment with the level of debate on recent British economic performance” (p. ix). Although such a perspective ensures that the writing is often challenging and never dull, it is not clear that it is the best way to write a core textbook. The aim may have been to produce a first-year-level version of Sidney Pollard's classic Development of the British Economy, 1914–1990 (4th ed., London: E. Arnold, 1992), but at times it comes closer in tone to his Wasting of the British Economy (London: Croom Helm, 1982).

Political economy and other idioms: French views on English development, 1815-48

This article investigates the role of political economy in the shaping of French views of British economic performance. It is argued that the potential of political economic for spreading a favourable interpretation of British development was not in fact realized until the end of the period considered. One reason for this was that earlier on, the image of economic Britain suffered from the legacy of the French Revolution and the Napoleonic wars, with a link often being established between British pauperism and British aristocratic, ‘feudal’ society and government. Additionally, political economy struggled to gain ascendancy over other modes of social analysis, like Saint-Simonism and the science of administration, which either combined with it, thus affecting its potential for a favourable understanding of Britain, or directly challenged it.

The great power dilemma: The trade‐off between defense and growth in great Britain, 1830–1980

This study investigates the relationship between British economic performance and various macroeconomic factors during the rise and fall of Great Britain as a great power from 1830 to 1980. It has generated a number of interesting findings. First, Britain's military spending is found to have a direct yet negative impact on its economic output Second, this negative effect appears to be moderate as compared to the stronger positive effect of investment Third, the results reveal that the effects of various factors on Britain's economy underwent a structural change during this long period of time. The most notable one is military spending. It suggests that in the nineteenth century when Britain was on the rise and strong, its military spending did not appear to hinder its economic performance. However, the trade‐off effects emerged in the twentieth century to hurt Britain's economy, contributing to Britain's relative decline in the post‐war era.

Rejoinder to Brian Caldwell

I found Brian Caldwell's response to my article both illuminative and informative. He is quite right to point to the differences in the policy context between the United Kingdom and Australia. In particular, he notes the degree to which accountability regimes are more rigorous, intrusive and, some would say, oppressive in the UK and the extent to which policy on school education has impacted on initial teacher education (ITE) in the UK but not in Australia. This has resulted in the development of a number of school-based routes into teaching in the UK, at least one of which is now paid. Education in Australia has, so far, escaped from these policy excesses. As Caldwell notes, the dynamic for the changes in British education came from powerful social forces outside education. Those changes included a massive restructuring of the industrial and commercial base of the British economy by the Thatcher government and a reorganisation of welfare provision to cope with demographic changes, especially an ageing population. The sweeping changes in education in the UK were generated by a government that perceived `The Education Establishment' to be resistant to the type and scope of the changes in education, which the government believed were necessary. Caldwell points out that I do not deal with the 1976 speech of Labour Prime Minister James Callaghan at Ruskin College, Oxford. He rightly draws attention to this speech in which Callaghan criticised the control over education that was wielded by teachers and educational administrators. Callaghan also blamed teachers directly for the decline in British economic performance and called for schools to be responsive to individual and national needs. This speech was followed by The Great Education Debate in which a series of meetings were held throughout the country to debate educational issues. This debate informed the Green Paper to which Caldwell refers. I have argued elsewhere (Bell, 1999) that this debate was more a series of closet whispers than a national outpouring of ideas, but Caldwell's assertion that it had little impact is incorrect. Although the Green Paper was a relatively brief document, it mapped out a much more interventionist approach to education policy and contained a set of policy initiatives, which, directly or indirectly, informed the development of education policy for the next two decades. Interestingly, however, the Green Paper had little to say about initial teacher education. Caldwell is correct in pointing out that the Conservatives under Margaret Thatcher came to power in 1979 in a time of economic crisis, but it was not until 1988 and the Education Reform Act that a comprehensive response to the issues raised by Callaghan was fashioned. This is not to say, however, that a number of policy initiatives had not been forthcoming. Attempts had been made to refocus the secondary school curriculum and its patterns of assessment, and to direct resources towards the professional development of teachers and in line with inservice priorities established by government. It was both the successes and the failures of these initiatives which eventually led to the Education Reform Act and the plethora of legislation that followed it under Thatcher, Major and Blair. …

Understanding Decline: Perceptions and Realities of British Economic Performance. Edited by Peter Clarke and Clive Trebilcock (New York, Cambridge University Press, 1997) 313 pp. $64.95

<i>Understanding Decline: Perceptions and Realities of British Economic Performance</i>. Edited by Peter Clarke and Clive Trebilcock (New York, Cambridge University Press, 1997) 313 pp. $64.95

Understanding Decline. Perceptions and Realities of British Economic Performance. Edited by Peter Clarke and Clive Trebilcock. Cambridge: Cambridge University Press, 1997. Pp. xv, 313. $64.95.

Understanding Decline. Perceptions and Realities of British Economic Performance. Edited by Peter Clarke and Clive Trebilcock. Cambridge: Cambridge University Press, 1997. Pp. xv, 313. $64.95.

Understanding decline: perceptions and realities of British economic performance

Understanding decline: perceptions and realities of British economic performance

Book Reviews

Alan S. Milward and George BrennanBritain's Place in the World. A Historical Enquiry into Import ControlsJens Laage‐HellmanBusiness Networks in Japan: Supplier–Customer Interaction in Product DevelopmentFrank‐Jurgen Richter, ed.The Dynamics of Japanese OrganisationsRoger MiddletonGovernment versus the Market. The Growth of the Public Sector, Economic Management and the British Economic Performance, c. 1890–1979Graham DunkleyThe Free Trade Adventure: The Uruguay Round and Globalism – A CritiquePierre van der EngAgricultural Growth in Indonesia: Productivity Change and Policy Inpact since 1880John SinletonThe World Textile Industry

Government versus the Market: the Growth of the Public Sector, Economic Management and British Economic Performance, c.1890-1979

Government versus the Market: the Growth of the Public Sector, Economic Management and British Economic Performance, c.1890-1979

Roger Middleton, Government versus the market: The growth of the public sector, economic management, and British economic performance, 1890–1979.

Roger Middleton, Government versus the market: The growth of the public sector, economic management, and British economic performance, 1890–1979.

The Reception of Scientific Management by British Engineers, 1890–1914

While Britain never had a scientific management movement like that in America, historians have exaggerated the negative reaction of British engineers to the ideas of F. W. Taylor and other American proponents of business efficiency. A review of the leading British engineering journals in the early twentieth century reveals that Taylorism received a fair amount of attention, and much of it positive. By the beginning of the First World War, the majority of trade journals were echoing Taylor's demands for a new type of management. The misapprehension on behalf of historians stems from a number of factors: an overemphasis on articles published during years of labor agitation, such as 1911 and 1912; and, a failure to appreciate the different way in which scientific management was perceived in Britain. This fuller understanding of British responses to Taylor and his ideas helps to elucidate a chapter in the broader history of British economic performance and managerial methods in the twentieth century.

Government versus the market: the growth of the public sector, economic management and British economic performance, c. 1890-1979

This work offers a comprehensive, interdisciplinary and, to some extent, controversial analysis of how Britain's relative economic decline from the late 19th century onwards, generated an intense debate about the legitimate roles of government and the market.

Universal banks and German industrialization: a reappraisal

Close relationships between universal banks and industrial companies are widely regarded as a distinctive feature of the German economy, and as having played an important part in German industrialization. This view has a long history, dating back to Jeidels, Riesser, and Hilferding.2 Perhaps its most influential exponent was Gerschenkron, who incorporated the supposedly crucial role of universal banks in German industrialization into his analysis of the contribution of different institutions to industrialization in backward econ~mies.~ argument is echoed in many more Gerschenkron's recent discussions of the contribution of systems of investment finance to economic growth. Kennedy argues that the failure of British financial intermediaries to behave as German universal banks did, hampered British economic performance in the late nineteenth and early twentieth ~enturies.~ Calomiris compares the American and German systems of investment between 1870 and 1914, and concludes that the German system was ~uperior.~ Baliga and Polak take the importance of universal banks in German industrialization as a central fact to be explained by their theory of comparative financial institution^.^ The view that Germany exemplifies the 'bank-based' system of investment finance, which is superior to alternative systems, in particular the 'market-based' Anglo-American system, is commonly encountered not only in historical analyses, but also in current policy debates, especially those concerning former centrally planned econ~mies.~ Despite some questioning of this view-for example, by Neuburger and Stokes8 (whose arguments were strongly criticized9), Cassis,lo and Fohlinl'the major role played by universal banks remains a central component of most accounts of German economic development. A recent proponent of the orthodox view is Chandler, who states that in Germany, the universal

INNOVATION AND EXPORT VOLUMES AND PRICES—A DISAGGREGATED STUDY

Competitiveness, trade performance, and employment DESPITE improvements in British economic performance in the mid-1980s the economy has subsequently experienced a recession of exceptional severity. During the later years of the boom the trade balance deteriorated sharply and in the subsequent slump the current account of the balance of payments has remained firmly in deficit. This poor trade performance reflects a continuation of long-run trends, which have often been attributed to a lack of 'non-price' competitiveness, deriving from insufficient innovation in the UK.

Vocational Training and British Economic Performance: A Further Instalment of the `British Labour Problem'?

Vocational Training and British Economic Performance: A Further Instalment of the `British Labour Problem'?

Vocational Training and British Economic Performance: A Further Instalment of the `British Labour Problem'?

This paper compares two influential `explanations' of Britain's economic problems - one, the British Labour Problem, points to the attitudes of British workers and their unions as the cause of poor productivity, the other, the British Training Problem, points to the low level and poor quality of vocational training in the UK as the source of economic ills. The paper argues that, despite apparent differences, the two discourses are very similar, so much so that it is valid to see arguments about the relation of vocational training and economic performance as a new instalment of the British Labour Problem. Just as the labour problem was a bogus characterization of the causes of Britain's problems in the 1980s and led to unhelpful policies, so the current preoccupation with training promises to play an analogous role in the 1990s. The comparative research of the National Institute for Economic and Social Research, which has been important in spreading the notion of the British Training Problem, is critically scrutinized in a way which complements Nichols earlier examination of the endemic faults in the social scientific material which underpinned the British Labour Problem `explanation'. The paper ends by suggesting why urging an increase in vocational training has become such a popular policy in the 1990s