The ability to create a competitive and thriving economy is partly dependent onknowledge production and innovation. So how well is the UK performing in theseimportant areas? To assess the UK’s comparative performance, and gauge how itmight perform in the future, it is a useful exercise to...

We investigate the empirical usefulness of a new measure of the degree of competition in a market, proposed by Boone (2000). This measure is based on the reduction in profits that firms experience as a result of cost inefficiencies. We compare this with measurescommonly used by policy makers and...

The UK’s poor productivity performance relative to the US has been a focus for government policy and analysis in recent Budgets and Pre-Budget Reports. Figure 1, where the UK business sector is scaled to 100, shows that US business sector labour productivity (value-added per worker) was just...

There is no hiding from the economic rise of the developing economies, and inparticular that of China and India. Leading global investment bank Goldman Sachsestimates that China will overtake the USA as the world’s largest economy by 2039.No doubt India will be close behind.Understandably many...

This paper considers the impact that information and communicationtechnology (ICT) has on firms’ choices over organisational form. In particular,the decision over whether to produce in-house or outsource services,and the decision over the location of activity. ICT reduces the transactionand...

This Briefing Note considers recent trends in specialisation, outsourcing and offshoring of businessservices.Specialisation within a firm happens when a firm organises an activity in a specialised unit, for example,when a firm moves payroll activities out of the back office of a factory, and...

Offshoring – the practice of sourcing business services fromoverseas – ignites controversy. The loss of UK jobs in businessservices to foreign providers makes headline news. Theimplication is that the UK has become less competitive in thebusiness services market. But what is the reality?...

We examine whether discretionary government grants influence thelocation of new plants. Grants have a small effect in attracting plants to specificgeographic areas, but their effectiveness increases with agglomeration externalities,measured by the number of other plants in that location in the...