Centre for Competitive Advantage in the Global Economy (CAGE)

Lead Research Organisation: University of Warwick
Department Name: Economics

Abstract

The transition period will see a strong focus on further impact activities and capacity building, alongside the pursuit of new research opportunities that naturally follow from CAGE1 and CAGE2. CAGE is keen to apply for fully-fledged centre funding in a future ESRC centres call. During the transition period, the overarching theme will continue to be 'succeeding in the global economy' and the Centre will be organised into research themes each with an 'organising question': Theme 1: What Explains Comparative Long-Run Growth Performance?; Theme 2: How do Culture and Institutions Help to Explain Development and Divergence in a Globalising World?; Theme 3: How Can the Measurement of Wellbeing be Improved and What are the Implications for Policy?; Theme 4: What are the Implications of Globalisation and Global Crises for Policymaking and for Economic and Political Outcomes?
During CAGE 1 and 2, research in Theme 1 made excellent progress in establishing a detailed quantitative picture of the dimensions of long-run economic growth over the past 800 years in Europe and Asia and the analysis will now be extended to cover Africa, and move from measuring real GDP per capita to accounting for the sources of growth in terms of factor inputs and their productivity. Research will also analyse the reasons for success and failure over the long-run at a more fundamental level with investigations covering pre-industrial to post-industrial times looking at the roles of geography, institutions, trade costs, and human capital and knowledge as well as economic policy. Theme 2 highlights the local cultural and institutional context of economic development, including identity. Many of our lessons on identity politics and propaganda are of relevance to not just Brexit in the UK, but also the rise of illiberal politics and populism across the world. Future work will focus on the role of illiberal ideas in the form of lack of tolerance of ethnic, linguistic and religious minorities, and immigrants. A third area of interest will be culture, religion and the rule of law. The enforcement of rules is central to the operation of all societies and organisations. A lot of the ongoing and planned research in theme 2 connects with Economic History and uses historic data. Theme 3 will continue to focus on deepening our understanding of the interactions between wellbeing and behaviour and developing new ways to measure wellbeing at the national level. This goes beyond happiness and into moods in general, personality, psychological traits, cognitive skills, belief-formation, and decision-making. Also Theme 3 links to Economic History with its interest in reconstruction of wellbeing measures from historic books. Theme 4 was added to CAGE during phase 2 after the appointment of a Professor of Quantitative Political Science as a key investment to further the work of CAGE. This research has examined the implications of tax competition for capital mobility and viability of welfare state policies in OECD countries as globalisation has intensified. The research highlights differing exposure to globalisation threats. Research in these areas will continue and expand into developing countries as well. Furthermore, the ongoing research agenda on maternity leave policy in understanding gender equality will continue to be a key area during transition, as it has received immense interest in government (Cabinet Office) and private industry and the university sector.
In conclusion, the distinctive feature of CAGE is that it crosses divides within economics, and explores issues traditionally regarded as at the boundaries of the discipline. CAGE research and policy advice is sensitive to context and based on an empirical approach that does not arbitrarily impose the priors of neoclassical economics. Finally, CAGE brings an informed historical perspective to current policy issues.

Planned Impact

CAGE research is intended to benefit society through deeper understanding of the complex causal chains that contribute to economic growth and performance. The impact will stem from a focus on fundamental global economic challenges for the present and for future generations. This is a broad and ambitious aim for a rich, integrated programme of work. We have sought, therefore, to organise our strategy for realising potential impact through six main pathways, as detailed in the Pathways to Impact.

The intended beneficiaries of CAGE research are UK executive (Government departments: Treasury, Cabinet office, BEIS, DFID), UK Parliament, European Commission and MEPs, International organisations (World Bank) and the general public. The way we achieve this is to go beyond writing papers and instead keep direct contacts with representatives of these organisations and to explain research using best practice of knowledge exchange. Doing this, we build capacity for academic excellence in government.

The Centre will undertake a wide range of knowledge transfer activities to ensure effective engagement with users.

These include

1. Policy papers - Warwick and SMF will produce an appropriate number of policy papers for each of the themes throughout the project. Each paper will be launched at a public meeting to be hosted at SMF. Key public figures will be invited to comment on the paper and to engage in debate. The papers may also be discussed at Brussels policy meetings.
2. Lunchtime policy/user meetings - in London and Brussels.
3. Major Policy Report - we plan major Policy Reports towards the end of the project.
4. Policy Fellowships - we will run a programme of secondments for key user stakeholders (policy and NGO) to work in the Centre for short periods.
5. User Training Workshops - CAGE will run a regular series of training workshops each year.
6. Op-Ed pieces - capitalising on opportunities arising from current events, for papers such as the Financial Times.
7.Twice-yearly magazine "Advantage".
8. Website - the Centre devotes significant time and effort to developing a useful and interactive website. This hosts the CAGE working paper series, along with the Background Briefing paper series, and the Global Perspective Series
9. CAGE has forged links with BEIS, DFID and other Government Departments which will ensure that our research is quickly disseminated to policymakers in those departments and will also enable them to help shape the evolution of the research programme.

Publications

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