An article by John Mills, Chairman of the eponymous JM Ltd, author of economics books and major Labour party donor, claims that UK productivity is ‘so low’ partly because we spend a far lower proportion of our national income (17%) on capital investment (aka capex) than the 26% world average – and woefully less than China’s …
Tag: Investment
Aug 28
The skills delusion
Adair Turner, Chairman of INET (Institute for New Economic Thinking) and one-time Chairman of the UK’s FSA (Financial Services Authority) wrote a weighty article a year or so ago on the need for more investment in our human stock We cannot better his choice of words so, below, reproduce much of his article verbatim It …
Mar 27
Bank Loans need Trust, Growth needs Credit
The essence of the following examples was extracted from a splendid book, Sapiens, written by Dr Yuval Noah Harari Example 1 – Loans require Trust: For most of history per capita production remained the same In 1500, global production of goods and services was equal to about $250 billion – today it hovers around $60 …
Jan 25
GDP – Alternative measures
ALTERNATIVE 1 – GVA: One alternative to GDP for measuring the state of an overall economy is GVA – Gross Value Added GVA claims to measure the contribution of each individual producer, industry or sector GVA = Output value – Intermediate consumption (too complex for most) Other definitions include: The value of the amount of goods …
Nov 22
Investors need to be ‘patient’, not greedy
In an article by Dr Paul Benneworth, Senior Researcher at the Center for Higher Education Policy Studies, University of Twente in the Netherlands claims that: “German companies, often envied by the UK, take a long-term view and plough the bulk of their surpluses into investment” Their workers also accept wage moderation because they see that …
Nov 20
Has innovation really peaked?
US economist Robert Gordon gets a lot of publicity these days for his dismal view that ‘technological innovation is declining in pace and impact compared to those of the 20th century’ – all set out in his book ‘The Rise and Fall of American Growth’ His whole thesis is based on economic growth statistics, GDP …
Aug 06
MGI assess productivity puzzle
The MGI (McKinsey Global Institute), the in-house think tank of the consulting giant McKinsey & Co, opened a recent ‘discussion paper’ on the productivity puzzle afflicting the USA and other developed economies by stating: “Now, as low birth rates slow the expansion of the labour force, increasing productivity, the output we get from every hour …
Jul 12
The Fourth Industrial Revolution
The following sweeping pearls of wisdom are 100% from Klaus Schwab, founder and executive chairman of the World Economic Forum I could not, indeed would not dare, try to improve on them but they surely deserve to be widely read We stand on the brink of a technological revolution that will fundamentally alter the way …
Mar 20
The capitalist’s dilemma
N.B. The following are extracts from an article published in the Harvard Business Review in June, 2014 – it remains highly relevant today Professor Clayton Christensen and Derek van Bever of Harvard Business School have embarked on a fascinating study into what may be holding back growth in the USA and elsewhere given ‘corporations are …