Energy Contagion in the COVID-19 Crisis

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By Reinhold Heinlein

At the time of the COVID-19 crisis, the oil market has suffered an unprecedented crisis, with the WTI crude oil price dropping into negative territory (-$37.63 per barrel) in April 2020. At the same time, the oil/stock market nexus is not clear cut and limited studies have considered the impact of crises in the oil market. A new working paper by researchers at UWE, Keele and Portsmouth investigates this unique situation.

Using a high frequency dataset (collected at intervals of 5 minutes), for a selected sample of oil importing and exporting countries across G7, BRICS and Scandinavian economies, we demonstrate the existence of an energy contagion, in terms of a consistently higher interdependence between stock markets and the crude-oil market during the COVID-19 driven oil crisis. Such results applies to all countries in our sample, although oil exporters are shown to have been hit more heavily, with Russia exhibiting the highest contagion.

Overall, our results confirm the importance of crude oil on stock markets, which have been shown to behave as a market of one during the recent crisis.

Reference and link: Reinhold Heinlein (Bristol Business School) is currently researching on the link between crude oil prices and stock markets during the COVID-19 pandemic, in a new paper, “Energy Contagion in the COVID-19 Crisis” written with Gabriella Legrenzi (Keele University) and Scott Mahadeo (Portsmouth University) and published in the CESifo Working Paper series No. 8345.

View the full working paper here.

Bringing Together Data to provide insights into Earnings & Employment

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The Wage and Employment Dynamics (WED) project aims to bring together data to provide insights into the dynamics of earnings and employment. The aim is to do this by integrating data across individuals across years, jobs, income sources and employers. This is a large project, with significant potential to improve our understanding of wage and employment issues from labour market entry, through job mobility and career progression to retirement decisions.

A team of researchers from UWE, University of London (CUL), UCL, and the National Institute of Economic and Social Research (NIESR) will create a wage and employment spine to do just this. We will train users on the spine and generate research findings of direct interest to policy makers. 

This will entail analysis of:

  • Employment: focusing on the drivers of hourly wages, part- and full-time employment, self-employment, underemployment, and retirement decisions
  • Households: focusing on the structure of households and household resources and the way they affect participation in the labour market, including child care, retirement decisions, and the impact of Universal Credit (UC)
  • Employer perspectives: focusing on how workers achieve wage growth both within and across firms, and how employers react to changing labour market conditions, such as shifts in skills, demand, technology and minimum wages.

At the heart of the project is the Annual Survey of Hours and Earnings (ASHE) and New Earnings Survey (NES). These survey datasets derive from a 1% sample of all employees in employment and will be developed to provide a truly longitudinal research resource. An ASHE/NES dataset which has longitudinal integrity across workers and jobs, with consistent referencing across data sets and time, will constitute a valuable research asset in its own right.

In addition, we aim to undertake six major linkage projects, in which we will create robust, documented linkages between the employee records contained in ASHE and data on:

  • enterprises and establishments – contained in the Interdepartmental Business Register, (IDBR);
  • personal and household characteristics – contained in the 2011 Census;
  • educational attainment – contained in HESA (Higher Education Student data);
  • benefit history – contained in DWP benefit records;
  • pay records – contained in HMRC PAYE data;
  • self-employment income – contained in HMRC Self Assessment (SA) records.

Through these various linking projects, we aim to create a core data set which allows integrated analysis of all forms of income across working lives, with the capacity to address a wide range of future analytical requirements. The end goal of the project is to turn this fully-linked dataset into a sustainable ‘wage and employment spine’ (WES), so that researchers no longer need to create new linkages each time. The linked data will be used for research purposes within the project itself, but the spine will form an ongoing resource for researchers. The intention is for the WES to form the basis for linked-data projects beyond 2022, both for academics and government agencies.

To find out more visit the WED website or sign up to their newsletter.

Fear of Robots and Life Satisfaction

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Tim Hink’s  article “Fear on Robots and Life Satisfaction” is forthcoming in the International Journal of Social Robotics.

The use of robots and in particular next-generation robots in the production of goods and services is increasing. What impact robots are having on people’s quality of life, including workers, is as yet under-explored. This paper provides initial findings examining whether fear of robots is correlated with one aspect of quality of life: life satisfaction. After controlling for individual effects and country effects and using both standard ordinary least squares and a linear multilevel regression model, we find fear of robots correlates with lower reported life satisfaction. There are differences in the fear of robots and life satisfaction by age group, by how long countries have been members of the European Union and by whether we control for attitudes towards other things. Presently the governance of emerging science and innovation that includes next-generation robots, roboticists and technologists is a “major challenge to contemporary democracies” (Stilgoe et al, 2013, p.1568). Along with others we call for a more responsible innovation framework that includes all stakeholders in the innovation process to understand where I4.0 can best be used in national and international interests.

Bribery, Motivations for Bribery and Life Satisfaction in Transitional Countries

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Timothy Hinks paper has just been accepted for publication

The focus on bribery and corruption and its impact on life satisfaction is relatively new in the economics and development studies literature. This paper contributes to this emerging field by asking whether reasons for making informal payments are correlated with life satisfaction. We find that paying bribes negatively correlates with life satisfaction and that those who were extorted by public officials or made an informal payment since they thought it was expected of them reported lower life satisfaction levels. We also find that those who made an informal payment to speed things up or who thought of the payment as a gift reported higher life satisfaction. Reasons for bribery differ in their associated significance with life satisfaction by public service that is used and by income group. For example people who instigated informal payments to public officials in the civil courts report higher life satisfaction bringing into question the integrity of judicial systems in transitional countries.

The paper is paper is published in World Development Perspectives and available online at here.

Book Review “Meta-Analyses of Micro- and Macroeconomic Textbooks” by Sebastian Berger

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Once upon a time, Germany – The Country of Poets and Thinkers (in German: Deutschland – das Land der Dichter und Denker) may have been an accurate description; not least because of the major contributions Germans made to economic thinking from Marx, List and Schmoller, to Weber, Schumacher and Kapp. However, after reading the results of Helge Peukert’s study of economic textbooks assigned at German universities, the uncanny question arises: Germany – country of translators and brainwashers? Indeed, much depends on the validity, meaning, and implications of the findings of one of Germany’s leading heterodox economists who conducted this project at the recently launched pluralist economics program of the University of Siegen, partly financed by the Research Institute for the Progressive Development of Society (Forschungsinstitut für Gesellschaftliche Weiterentwicklung).

Both books are structured as follows: the introductory chapters focus on distinguishing varieties of what may be called neoclassical and heterodox paradigms, or communities. It then develops an analytical framework that consists of meta-paradigmatic elements underlying these paradigms. These elements cross-fertilise the paradigms so that there is no hard boundary between them but rather a complex web of neoclassical and heterodox paradigms. Peukert’s analytical framework is inspired by Ludwik Fleck’s theory of science, which argues that ‘thought collectives’ engage in the social construction of reality based on ‘archetypal ideas’ (read: meta-theoretical elements) that reflect the ‘spirit of the times’. With the aid of this framework, the main chapters assess in detail the dominating micro and macro textbooks, i.e., Varian (2016), Pindyck and Rubinfeld (2015), Mankiw (2016) and Blanchard and Illing (2017). The guiding questions of Peukert’s study are: how scientific or ideological are these textbooks? What meta-paradigmatic elements can be identified in each chapter?

Business Models for Sustainability The Barriers and Solutions: Workshop

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Tuesday 28th January saw The Future Economy Network take a wintery trip up to University West of England’s Frenchay Campus. The business breakfast workshop was attended by a diverse range of businesses keen to look at their business models through a sustainability lens. The workshop was kindly hosted by the Economics team at UWE. The network supplied sustainable pastries from their own eco-café, Future Leap.

Katherine Piper, Director of The Future Economy Network welcomed attendees, highlighting the benefits of joining the Network and also sharing exciting updates about The Future Economy Network’s Carbon Neutral Hub in Bristol, Future Leap. Katherine also briefly ran through the plans for The Festival of Sustainable Business (check out the video here). We set the groundwork for the workshop by starting with two introductory talks by Ruth Smith, Founder of Sustainable Results Lab, and Peter, Economics professor at UWE.

Ruth set the scene with her history & skills in sustainable business model development, having grown from working as an editor. From her experience, she learned of the continuous battle between a company’s values and the pressure to make profit. Ruth emphasised the importance of values within business planning. She used inspiring quotes from Gary Hanel, Michael Porter and America’s Business Roundtable to explain the triple bottom line theory and modern business’ shift from shareholder to stakeholder value. She mentioned the importance of the new accreditation B-Corp. Learn more about B-Corp at our upcoming event. Many businesses have a 30-40 year timeframe therefore are finally starting to implement the environment as an essential stakeholder. Ruth also mentioned the importance of emerging clean tech. Learn more about Clean Tech at our upcoming event. With her expertise in marketing, Ruth touched on the brilliant tools in the digital and marketing sphere. She did caution however, the need to be aware of the greenhouse gas emissions from digital technologies, which account for 4% of greenhouse gases.

Peter then introduced his workshop by defining the concept of sustainable development by design and introducing the associated toolkit. He discussed the concepts behind sustainable development, business models, and value, emphasising the importance of context and perception changing value. He then discussed the torchlight model in his paper with Glenn Parry and Nicholas O’Regan about developing sustainable business models, and gave an example of the model in practice.

After a quick coffee break, attendees split into 4 groups and worked through their company business models using the torchlight model. After an hour, the teams fed back to the rest of the group on their work.

The event concluded with some 60 second pitches from Garrett Creative, Solar Roofing Specialists & Halcyan Water, and some valuable networking. A huge thank you to the Economics team at UWE for hosting the event and providing refreshments. Without such support we would not be able to do these wonderful inspiring events.

Business Models for Sustainability – A Workshop Collaboration

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The Future Economy Network (FEN) is a Bristol-based organisation born out of a need for sustainable business and better future thinking in response to the climate emergency. And in one of the most creative and environmentally conscious cities in the UK, what better place to meet the growing demand? All over the South West, FEN are seeing more and more active individuals and engaged businesses joining the network to learn about sustainability, meet like-minded others, and increase their sustainable business strength.

In response to the clear need for sustainable business growth, FEN are teaming up with UWE to create an engaging workshop titled “Business Models for Sustainability: The Barriers & Solutions”. There has been a significant growth in purpose before profit; businesses are increasingly seeing their customers demand social responsibility as an integrated part of the offer, not an afterthought or addition. With fantastic initiatives like B-Corp or Science Based Targets, businesses recognise that profit is no longer king, but the future of their growth (and survival) relies on the triple bottom line.

On 28th January, FEN and UWE will co-host a three-hour interactive workshop to better understand your business model. The session will start with two informative, introductory talks and then lead into personalised break out workshops.

What To Expect:

– Tools to develop business models for better understanding;

– Sustainable development and business models;

– Current and future business models.

One of the keynote speakers includes Peter Bradley, a leader in sustainable development at UWE. He is the principal investigator of the ‘Understanding and assessing business models for sustainability’ project, which researches the environmental and economic viability of business models that are intended for sustainable development. Alongside Peter, Ruth Smith from Sustainable Results Lab will be speaking on how Purpose beyond profit is the biggest movement in business right now. Ruth founded the Sustainable Results Lab to bring world class digital marketing to the environmental sector. Both speakers are members of FEN’s sustainability network.

The event will also include the usual elements of FEN’s weekly sustainable events programme that many have come to know and love, such as valuable networking, a friendly and motivational team, exciting 60 second pitches, and professional event delivery.

Grab your ticket here or pop into FEN’s new sustainability hub, Future Leap, to find out more about the diverse range of services available to those wishing to grow on their sustainability journey.

Update from Annie Tubadji, Senior Lecturer in Economics

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Senior Lecturer in Economics, Annie Tubadji is currently a Specially Appointed Lecturer at Hokkaido University in Sapporo, Japan.

As part of her visiting scholar activities, Annie will deliver an undergraduate and postgraduate course on the “Economics of Happiness” at Center for Regional Economic and Business Networks (REBN) Summer School Institute.

As part of my Visiting Scholar activities, I will deliver here two courses (undergraduate and graduate ones) on economics of happiness at their Center for Regional Economic and Business Networks (REBN) Summer School Institute.

As part of her visit, Annie will also be delivering two specially invited lectures.

More on the Summer School Institute can be found here

Pro-environmental employee and consumer behaviour conference 2019

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The Bristol Centre for Economics and Finance’s first conference on Pro-environmental employee and consumer behaviour was held on the 29th of April 2019.

The day was a major success with around 80 registered participants and 14 presenters with many attending organisations and academics.   The event was highly energised, with many thought provoking questions for speakers and an atmosphere full of interest. 

Bristol Green Capital introduced the day,  the afternoon session was opened by the Future Economy Group and the closing of the conference was led by Dr Peter Bradley. We would like to thank again everyone who participated.  The event will run again next year.  The slides from the day, for those who are further interested in the conference and would like to find out more, can be found here.

Autonomy launch new policy report on a shorter working week

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BCEF member Dr Danielle Guizzo Archela is an associate researcher of Autonomy, an independent, progressive think tank which aims to address the uncertainty of work in the modern era.

Autonomy is comprised from a multidisciplinary array of researchers and experts in political economy and critical theory. On Friday 1st February 2019 Autonomy launched a new policy report on a shorter working week. “The shorter working week: a radical and pragmatic proposal” outlines the case for a shorter working week and shows that there is no positive correlation between productivity and the amount of hours worked per day. The report has received praise from a number of politicians and academics.

“This is a vital contribution to the growing debate around free time and reducing the working week. With millions saying they would like to work shorter hours, and millions of others without a job or wanting more hours, it’s essential that we consider how we address the problems in the labour market as well as preparing for the future challenges of automation.” John McDonnell, Labour Shadow Chancellor

Our conventional working week and the idea of a compromising work-life balance in the UK has been debated in the media for some time. Last year in New Zealand a landmark trial of a four-day working week concluded it an unmitigated success and the discussion on how a four-day work week could be implemented long-term was opened up.

The Autonomy report has already been making headlines, and the idea of working “part-time” being standard, rather than just an option for those who can afford it, has been very popular. Below are just a few of the recent articles on the report.

https://www.newstatesman.com/politics/economy/2019/02/how-idea-four-day-week-went-mainstream
https://www.theguardian.com/commentisfree/2019/feb/01/bring-on-the-four-day-working-week-for-teachers
https://metro.co.uk/2019/02/01/boss-needs-know-productive-shorter-working-week-8423713/
https://www.redpepper.org.uk/less-work-more-play-a-solution-to-britains-economic-woes/

Autonomy have also produced a short YouTube video to accompany the report launch.

The Shorter Working Week launch video

Please see the Autonomy website to read more and to download the full report.