UWE Bristol Economics at the 9th IIPPE Annual Conference in Political Economy

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By Sara Stevano, Susan Newman and Lotta Takala-Greenish.

On 12-14th September 2018, the 9th IIPPE Annual Conference in Political Economy took place at Juraj Dobrila University of Pula, Croatia. Keeping up with recent years’ record, UWE Economics was very well represented at the conference! The conference was organised around the overarching theme of ‘The State of Capitalism and the State of Political Economy’ and over 300 scholars and activists from across the world discussed their political economy research, touching upon various facets of capitalist transformations and pushing the frontiers of political economy. The conference organisers reported that many participants thought that this was the best IIPPE conference so far!

Among the keynote speeches were a panel shared by Professor Lena Lavinas, Professor of Welfare Economics at the Federal University of Rio de Janeiro, and Professor Fiona Tregenna, University of Johannesburg South African Research Chair in Industrialisation stood out for their original content. Professor Lavinas highlighted the shifts in social programmes to increase financial inclusion. She commented on the contribution of social service programmes to GDP, 1.5% for developing and 2.7% of GDP for OECD countries, and connected these to the accumulation of debt among low-income households (see the excellent twitter feed by Ingrid H. Kvangraven). Professor Spread of income transfer programs across Global South have facilitated mass ‘financial inclusion’. The state and international financial institutions also play important role here. Result: Low-income households have accumulated huge amounts of debtSpread of income transfer programs across Global South have facilitated mass ‘financial inclusion’. The state and international financial institutions also play important role here. Result: Low-income households have accumulated huge amounts of debtTregenna focused on the need to unpack different forms of de-industrialisation and to explore the perspective that Marx’s analysis can offer to understanding industrialisation. In particular, her insights included an expanded focus on the heterogeneity within sectors and the inseparability of production and consumption (see also this blog post for further insights on the IIPPE2018 conference).

Spread of income transfer programs across Global South have facilitated mass ‘financial inclusion’. The state and international financial institutions also play important role here. Result: Low-income households have accumulated huge amounts of debtSpread of income transfer programs across Global South have facilitated mass ‘financial inclusion’. The state and international financial institutions also play important role here. Result: Low-income households have accumulated huge amounts of debtReflections on the state of capitalism are very relevant and timely in the context of shifting geographies of production, global relations of power and political discourse. Thus, it is all the more important to discuss how political economy research can help us understand and shape the economic, social and political transformations that mark our time. Critical political economy has an important role to play in transforming and revitalising economics, making it an inclusive and relevant area of study.

The three UWE Economics researchers who were in attendance this year intervened in panels on neoliberalism, the political economy of work, social reproduction and commodity studies. Dr Lotta Takala-Greenish presented her research on Exploring formal/informal work structures in South African waste collection (slides available here) in a panel that was described by the audience as one of the most interesting of the conference. This panel shared with Professor Stephanie Allais of the University of Witwatersrand, put forward important questions about the role of training and learning (both on and off the job) and the connections between education and labour markets. It also provided a forum to discuss and develop future collaborations with the South African Research Chair for Skills Development at the Centre for Researching Education and Labour. Dr Susan Newman presented her joint paper with Sam Ashman on New Patterns in Capital Flight from South Africa and discussed the preliminary findings of her joint paper with Dr Sara Stevano on The neoliberal restructuring of UK Overseas Development Assistance (slides available here), both papers were very appreciated by the audience who thought them revealing and timely. Sara Stevano presented her paper on Women’s work in Mozambique: Gender, social differentiation and social reproduction (slides available here) in a great all-women panel on social reproduction and the political economy of work.

Across several sessions, there was much discussion of the future of pluralist economics and education where UWE economics was highlighted as a leading institution. UWE Economics is now considered as an established centre for critical political economy, with possibly the largest concentration of critical political economists in a UK university. UWE’s recent recruitment of pluralist economists has been noted widely and was reflected in questions about future recruitment plans. Participation of UWE Economics in IIPPE continues to reaffirm the presence of our group in current political economy debates and generates opportunities for collaboration with colleagues in the UK and beyond. UWE Economics academics are involved with IIPPE in various capacities. Susan Newman oversees the content published on the IIPPE website and coordinates the working group on commodities studies; Sara Stevano coordinates the social reproduction working group with Hannah Bargawi (SOAS); Lotta Takala-Greenish set up and previously coordinated the working group on Minerals Energy Complex and Comparative Industrialisation.

One of the key aims of IIPPE is to provide a platform for early career researchers to interact with more established and senior scholars in political economy. The conference provided an opportunity benchmark and share information about postgraduate training in political economy. The UWE MSc in Global Political Economy was mentioned as one of only a handful degrees providing an interdisciplinary political economy approach housed within an economics department. The first intake of UWE’s MSc Global Political Economy students will be submitting their dissertations end of September and are being encouraged to submit their research to present at the next IIPPE conference in July 2019. We are also welcoming our new 2018-2019 MSc students who will no doubt contribute to the active research environment that we have here at UWE Bristol.

 

Bringing the ‘political’ back into the economy: A report from I Workshop in Contemporary Political Economy (UWE Bristol-Paris 1 Sorbonne)

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By Danielle Guizzo and Bruno Tinel

 

The 1st Workshop in Contemporary Political Economy recently took place at the Bristol Business School on June 28th, 2018. It was the first event of a recently established partnership between the UWE Economics subject group (AEF) and the Paris 1 Department of Economics (Pantheon Sorbonne University) as a response to the increasing importance of pluralism in economics teaching and research in the post-crisis scenario. A large proportion of attendants were young scholars (early-career researchers or PhD students), who represent a promising generation for promoting the expansion and excellence of research in political economy as the future of the international PE community.

We are very pleased to inform the community that the workshop was a great success in terms of the quality of the presentations, the number of participants, and the pluralism of subjects. The presentations and subsequent discussions explored the recent frontiers in contemporary political economy, aiming at expanding three main areas: critical macroeconomics; financialisation; and ideology, power and the state.

The final session constituted of a roundtable about the future of pluralistic research in economics and the possibility of engagement with the mainstream of the discipline. Participants expressed the importance of institutional support and an active scholarly community to move beyond standardized metrics and diamond lists in research assessment exercises if we seek to achieve an open, equal dialogue in Economics that allows inclusivity.

Thanks to the great enthusiasm of the workshop’s participants, we will continue to organize a yearly workshop with the purpose of further promoting and disseminating teaching and research in political economy and pluralistic economics, expanding the partnership between UWE and Paris 1-Pantheon Sorbonne, and improving communication and academic exchange among scholars. Therefore, the Department of Economics at Paris 1-Pantheon Sorbonne will organize the second edition of the workshop in contemporary political economy.

We would like to thank the Bristol Centre for Economics & Finance (BCEF), as well as the Accounting, Economics and Finance (AEF) for the grants and support they provided, allowing for the organization of this workshop. We also express our gratitude to the presenters, who delivered excellent talks and provided a space for the exchange of ideas that significantly contributes to future partnerships and prospective research projects.

 

Mexico and Trump

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By Laura Povoledo

I had the good fortune of visiting Mexico last year on a research visit funded by the British Academy. Mexico is a beautiful country, full of rich history and diverse culture. But it is also a country with huge social problems.

Mexico is the 11th most populated country in the world with around 127 million people. It has been estimated that 42% of Mexico’s total population lives below the national poverty line. Getting millions out of poverty will require enormous effort, but in recent years a growing middle class has emerged, thanks to sustained economic development. The economy of Mexico is now the 11th largest in the world by purchasing power parity, and according to Goldman Sachs, by 2050 Mexico will be the 5th largest economy in the world.

However, recently Mexico has been through some very difficult years. In 2016 the GDP growth rate was below 2% and inflation was 4%. The peso steadily depreciated against the dollar, forcing the government to increase the price of gasoline (half of the fuel consumed by Mexico is imported from the US). Given the country’s poor public transport infrastructure, the cost of private transport is especially important in Mexico, so the increased price of petrol will severely affects households’ living standards. The recent increase in the minimum wages is unlikely to meet the needs of those on low incomes. This deteriorating economic environment has prompted Standard & Poor’s to change their perspective from “stable” to “negative”. And of course, in 2016 Trump was elected.

One of the risks posed by a failing economy is nationalism (and Trump himself is an example). However, Latin America nationalism is different from Trump’s right-wing nationalism. Nationalisms in Latin America have often been associated with left-wing political positions. This is explained by the colonial past and the struggles of national liberation. Mexico will hold its general election on July 1st, and the left’s presidential candidate, Andrés Manuel López Obrador, is as opposed to NAFTA as is Trump.

NAFTA has led to an enormous expansion of US companies in Mexican territory, and several Mexican economists I talked to were often keen to point out that protectionists policies will ultimately damage American interests. It has been estimated that in its 22 years NAFTA has generated 6 million jobs in the US. 40% of the components of Mexican exports are actually produced in the US, in other words, 40 cents of every dollar spent on Mexican exports support jobs in the US. There are now 35 millions of Mexicans living in the United States, of which about 11 million were born in Mexico. Mexican immigrants take the hardest and lowest paid occupations and they provide a source of manpower in many industries, such as agriculture, construction and food processing.

During my visit there I often found a strong rejection of Trump’s rhetoric and a determination to fight against all adversities. A resurgence of national pride may not be totally undesirable if it spurs Mexico to take anti-poverty measures, to support its growing middle class and to dismantle the other wall that is holding it back, that of corruption.

 

A response to UWE gender pay gap reporting: looking at Bristol Business School

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By the researchers of the ‘Earnings gaps and inequality at work’ project, BBS

In compliance with new UK legislation, UWE Bristol published its own gender pay gap report in March 2018. Whilst recognising the need to do more to close the pay gap between women and men, that UWE achieved a gender pay gap of 13.15% has been portrayed as a sign of progress. The UWE figure is lower than the national average of 18.1% (ONS 2016)[1] and has decreased by 4.85 percentage points since 2003.[2] But if the current rate of progress is anything to go by it will be another 40 years  before the gender pay gap at UWE is closed. In Bristol Business School[3] (BBS), 67% of academic staff at lecturer level and 53% at senior lecturer level are women compared with 44% and 43% at associate professor and professor levels respectively. That women are overrepresented at lower grades is not a sign of real progress, but rather that women struggle through career progression. It is then crucial to better understand what explains the gender pay gap and what actions are necessary to tackle gender discrimination at work.

 

 

 

 

 

 

 

Within academia, gender gaps manifest for various reasons including slower progression paths (Krefting 2003; Holiday et al. 2014; Winslow and Davis 2016). In BBS, women are well represented at the executive and management levels which might indicate specific barriers against academic promotion such as from senior lecturer to associate professor and above. A recent Times Higher Education article highlighted that one in three UK universities are going backwards on female professorships. Studies have also revealed discrimination in academic publishing. Women are less likely to push for first authorship when collaborating with men, and women authored articles face higher levels of scrutiny in the peer review processes (West et al. 2013; Hengel 2017).  Women tend to apply for fewer external grants, although their success rate tends to be higher. In addition, women face disproportionate burdens in relation to career progression once they have children.  Female academics face a motherhood citation penalty whilst having children appears to advantage men’s career progression. A recent study in the US showed that men with children were 35 percent more likely than women with young children to secure tenure-track positions. Men with children are also 2 percent more likely to secure these positions compared with women without children (Mason et al. 2013). There is quite some variation across disciplines in terms of gender discrimination with economics being particularly bad in terms of apparent gender imbalances in student enrolment and all the way through in academic careers (Ginter and Khan 2004; Goldin 2013; Tonin and Wahba 2014; Crawford et al. 2018).

The Gender Pay Gap is not about Equal Pay

The gender pay gap captures some of the outcomes of discrimination – for example, wage inequality, job segregation and differential progression – but it obscures others. More importantly, it tells almost nothing about the complex mechanisms via which societal norms, class, power relations, institutional structures, workplace practices, legislation, and individual attributes interact and reinforce gendered, as well as other types of discrimination. As explained in this Guardian’s video, the gender pay gap data does not reveal anything about equal pay, which is whether women and men are paid equally for the same type of job. Furthermore, research has shown that  the allocation of workload, autonomy over one’s time use, the burden of pastoral care, and  physical and emotional conditions of work are on average worse for women compared to male colleagues (Holliday et al. 2014; Stier and Yaish 2014). Even the ways in which women are assessed on the quality of their work are highly discriminatory. Women experience substantial negative bias in students’ assessments.  Women in academia operate under workplace conditions that are stacked against them.

Inequality and mental health

There is increased understanding that inequalities within societies worsen mental health outcomes for oppressed groups. In relation to women’s mental health, there has been a tendency to pathologise the ways in which women individually deal with abuse or oppression rather than recognising the structural or societal causes. For example, the diagnosis of Borderline Personality Disorder (BDP) is applied predominantly to women whilst many of the traits associated with the diagnosis fit closely with gender based abuse and trauma. Men with similar manifestations of mental health outcomes are more likely to be diagnosed with post-traumatic stress disorders that recognise the underlying cause (Shaw and Proctor 2005).

The unequal burden of domestic work that academic women shoulder also takes its toll on mental health. The publish or perish dictum for academic progression together with growing administrative and teaching loads mean that women struggle more to put in the ‘extra hours’ in the evening or at weekends for research expected in academia today. Fagan et al. (2011) reviewed international evidence on working time arrangements on work-life ‘balance’ and discovered that paid employment increases the well-being of women, but those who work long hours in paid employment while retaining primary responsibility for domestic tasks at home are at particular risk of poorer mental health. A study using data from the British Household Panel Survey (BHPS) found that working hours over 49 hours a week was associated with poorer mental health for women, but not men. We would expect the effects to be intensified for women with small children. UWE’s commitment to ‘mental wealth’ means that our institution has to take the issue of workloads seriously for all, but particularly for women.

What can be done?

What is to be done? Some think the women’s behaviour change is what is needed to close the gender pay gap. For example, women need to be more assertive in demanding pay rises and promotion. Within BBS, a number of women have received support in the form of coaching to help identify goals, strategies and behaviours that would most support their achievement. UWE has established programmes in women’s leadership and there is a “women in research” mentorship programme with a high take up. There are also numerous self-help groups online and many of us form small communities of care, nurture and peer support and collaboration. Whilst these initiatives are important and help women to identify coping mechanisms and navigate the system, they do nothing to challenge the institutional structures stacked against them.  What is needed is better institutional provisions to ameliorate the disproportionate burdens faced by women which could begin with making sure that women are pushed to apply for every opportunity for internal research support open to them; additional provision for early career women academics; support for women returning from maternity leave in order to catch-up on research; better maternity leave provision (with 6 weeks full pay followed by 12 weeks of half pay, UWE is amongst the least generous in UK HEIs); expanding the number of AP positions and reversing the balance of gender representation to ensure parity is reached at the professorial level in the next 5-10 years; and training on gender issues to all staff.

But more than this, we need to better understand how various forms of inequality – gender, race, class, disability, citizenship status, and religion – place workers in conditions of particular vulnerability in the workplace. This blog has focused on women academics, but many of our colleagues provide critical support for the functioning of the university in the form of admin, student support, cleaning and catering. UWE’s gender pay gap reporting does not paint a rosy picture for women and, in addition, a much deeper understanding of inequality at work is clearly needed. It is positive that BBS has taken the lead under the championing of Donna Whitehead, who is committed to the promotion of women and minorities. With the support of the faculty, a number of us are embarking on innovative research on this topic in order to strengthen UWE’s Inclusivity 2020 strategy and commitment to implementing necessary actions. We hope that in this way BBS and UWE could become the drivers of change in the sector.

A group of us in Economics have received internal funding to kick off a research project on Earning Gaps and Inequality at Work. We are interested in developing a multi-method approach to study quantitative and qualitative aspects of inequality at work. As part of this project, an expert workshop to discuss if and how we should look beyond the (gender) pay gap to understand inequality in the workplace will be held on 25th May 2018 at UWE. External participants with expertise on these themes will also be interviewed and a podcast series on inequality at work will be launched at the beginning of the new academic year.

 

Crawford, Claire; Neil M Davies, & Sarah Smith (2018). Why do so few women study economics? Evidence from England, available at http://www.res.org.uk/SpringboardWebApp/userfiles/res/file/Womens%20Committee/Publications/why%20do%20so%20few%20women%20study%20economics,%202018.pdf

Fagan, C., Lyonette, C., Smith, M. and Saldana-Tejeda, A. 2011. The influence of working time arrangements on work-life integration or ‘balance’: A review of the international evidence. Conditions of Work and Employment Series No. 32. Geneva: ILO.

Ginther, D. K., & Kahn, S. (2004). Women in economics: moving up or falling off the academic career ladder?. The Journal of Economic Perspectives18(3), 193-214.

Goldin C. (2013). Notes on Women and the Undergraduate Economics Major. CSWEP Newsletter. (Summer) :4-6, 15.

Hengel, E. (2017). Publishing while Female. Are women held to higher standards? Evidence from peer review. Retrieved from https://doi.org/10.17863/CAM.17548

Holliday, E. B., Jagsi, R., Wilson, L. D., Choi, M., Thomas Jr, C. R., & Fuller, C. D. (2014). Gender differences in publication productivity, academic position, career duration and funding among US academic radiation oncology faculty. Academic medicine: journal of the Association of American Medical Colleges89(5), 767.

Krefting, L. A. (2003). Intertwined discourses of merit and gender: Evidence from academic employment in the USA. Gender, Work & Organization10(2), 260-278.

Liff, S., & Ward, K. (2001). Distorted views through the glass ceiling: the construction of women’s understandings of promotion and senior management positions. Gender, Work & Organization8(1), 19-36.

Mason, M.A., Wolfinger, N.H. and Goulden, M., (2013). Do babies matter?: Gender and family in the ivory tower. Rutgers University Press.

Shaw, C. and Proctor, G. (2005). I. Women at the margins: A critique of the diagnosis of borderline personality disorder. Feminism & Psychology, 15(4), pp.483-490.

Stier, H., & Yaish, M. (2014). Occupational segregation and gender inequality in job quality: a multi-level approach. Work, employment and society28(2), 225-246.

Tonin, M., & Wahba, J. (2014). The sources of the gender gap in economics enrolment. CESifo Economic Studies, IZA DP No. 8414.West, J. D., Jacquet, J., King, M. M., Correll, S. J., & Bergstrom, C. T. (2013). The role of gender in scholarly authorship. PloS one8(7), e66212.

Winslow, S., & Davis, S. N. (2016). Gender inequality across the academic life course. Sociology Compass10(5), 404-416.

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[1] The average for higher education institutions is 15.9%, lower than the national average, as outlined in this Time Higher Education article.

[2] The rate of progress in closing the gender pay gap has been much more substantial in other higher education institutions, such as Sheffield University, where the gender pay gap reduced from32.2% in 2003 to 15.2% in 2017 – see Sheffield reporting here.

[3] Figures for gender distribution across academic grades have been put together from information available on the UWE website and may not be up to date. All personnel in management positions were counted as senior lecturers unless otherwise stated in their online staff profile.

Measuring non-compliance with minimum wages

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By Professor Felix Ritchie

When a minimum wage is set, ensuring that employees do get at least that minimum is a basic requirement of regulators. Compliance with the minimum wage can vary wildly: amongst richer countries, around 1%-3% of wages appear to fall below the minimum but in developing countries non-compliance rates can be well over 50%.

As might be expected, much non-compliance exists in the ‘informal’ economy: family businesses using relatives on an ad hoc basis, cash-only payments for casual work, agricultural labouring, or simply the use of illegal workers. However, there is also non-compliance in the formal economy. This is analysed by regulators using large surveys of employers and employees which collect detailed information on hours and earnings. This analysis allows them to identify broad characteristics and the overall scale of non-compliance in the economy.

In the UK, enforcement of the minimum wage is carried out by HM Revenue and Customs, supported by the Low Pay Commission. With 30 million jobs in the UK, and 99% of them paying at or above the minimum wage, effective enforcement means knowing where to look for infringements (for example, retail and hospitality businesses tend to pay low, but compliant, wages; personal services are more likely to pay low wages below the minimum; small firms are more likely to be non-compliant than large ones, and so on). Ironically, the high rate of compliance in the UK can bring problems, as measurement becomes sensitive to the way it is calculated.

A new paper by researchers at UWE and the University of Southampton looks at how non-compliance with minimum wages can be accurately measured, particularly in high-income countries. It shows how the quantitative measurement of non-compliance can be affected by definitions, data quality, data collection methods, processing and the choice of non-compliance measure.

The paper shows that small variations in these can have disproportionate effects on estimates of the amount of non-compliance. As a case study, it analyses the earnings of UK apprentices to show, for example, that even something as simple as the number of decimal places allowed on a survey form can have a significant effect on the non-compliance rates.

The study also throws light on the wider topic of data quality. Much research is focused on marginal analyses: looking at the relative relationships between different factors. These don’t tend to be obviously sensitive to very small variations in data quality, but that is partly because it is can be harder to identify sensitive values.

In contrast, non-compliance with the minimum wage is a binary outcome: a wage is either compliant or it is not. This makes tiny variations (just above or just below the line) easier to spot, compared to marginal analysis. Whilst this study focuses on compliance with the minimum wage, it highlights how an understanding of all aspects of the data collection process, including operational factors such as limiting the number of significant digits, can help to improve confidence in results.

Ritchie F., Veliziotis M., Drew H., and Whittard D. (2018) “Measuring compliance with minimum wages”. Journal of Economic and Social Measurement, vol. 42, no. 3-4, pp. 249-270. https://content.iospress.com/articles/journal-of-economic-and-social-measurement/jem448

“A Remarkable National Effort”: The Dismal Arithmetic of Austerity

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Dr Rob Calvert Jump and Dr Jo Michell assess public debt accounting in this article.

In a recent tweet, George Osborne celebrated the fact that the UK now has a surplus on the government’s current budget. Osborne cited an FT article noting that “… deficit reduction has come at the cost of an unprecedented squeeze in public spending. That squeeze is now showing up in higher waiting times in hospitals for emergency treatment, worse performance measures in prisons, severe cuts in many local authorities and lower satisfaction ratings for GP services.”

It is a measure of how far the debate has departed from reality that widespread degradation of essential public services can be regarded as cause for celebration.

The official objective of fiscal austerity was to put the public finances back on a sustainable path. According to this narrative, government borrowing was out of control as a result of the profligacy of the Labour government. Without a rapid change of policy, the UK faced a fiscal crisis caused by bond investors taking fright and interest rates rising to unsustainable levels.

Is this plausible? To answer, we present alternative scenarios in which actual and projected austerity is significantly reduced and examine the resulting outcomes for national debt.

Public sector net debt (the headline government debt figure) in any year is equal to the debt at the end of the previous year plus the deficit plus adjustments,

where PSND  is the public sector net debt at the end of financial year, PSNB is total public sector borrowing (the deficit) over the same year, and ADJ is any non-borrowing adjustment. This adjustment can be inferred from the OBR’s figures for both actual data and projections. In our simulations, we simply take the OBR adjustment figures as constants. Given an assumption about the nominal size of the deficit in each future year, we can then calculate the implied size of the debt over the projection period.

What matters is not the size of the debt in money terms, but as a share of GDP. We therefore also need to know nominal GDP for each future year in our simulations. This is less straightforward because nominal GDP is affected by government spending and taxation. Estimates of the magnitude of this effect – known as the fiscal multiplier – vary significantly. The OBR, for instance, assumes a value of 1.1 for the effect of current government spending.  In order to avoid debate on the correct size of the nominal multiplier, we assume it is equal to zero.[1] This is a very conservative estimate and, like the OBR, we believe the correct value is greater than one. The advantage of this approach is that we can use OBR projections for nominal GDP in our simulations without adjustment.

We simulate three alternative scenarios in which the pace of actual and predicted deficit reduction is slowed by a third, a half and two thirds respectively.[2] The evolution of the public debt-to-GDP ratio in each scenario is shown below, alongside actual figures and current OBR projections based on government plans.

 

Fig [1]

Fig [2] 

Despite the fact that the deficit is substantially higher in our alternative scenarios, there is little substantive variation in the implied time paths for debt-to-GDP ratios.  In our scenarios, the point at which the debt-to-GDP ratio reaches a peak is delayed by around two years. If the speed of deficit reduction is halved, public debt peaks at around 97% of GDP in 2019-20, compared to the OBR’s projected peak of 86% in the current fiscal year. Given the assumption of zero nominal multipliers, these projections are almost certainly too high: relaxing austerity would have led to higher growth and lower debt-to-GDP ratios.

Now consider the difference in spending.

Halving the speed of deficit reduction would have meant around £10 billion in extra spending in 2011-12, £8 billion in 2012-13, £19 billion in 2013-14, £21 billion in 2014-15, £29 billion extra in 2015-16, and £37 billion extra in 2016-17.  To put these figures into context, £37 billion is around 30% of total health expenditure in 2016-17.  The bedroom tax, on the other hand, was initially estimated to save less than £500 million per year.  These are large sums of money which would have made a material difference to public expenditure.

Would this extra spending have led to a fiscal crisis, as supporters of austerity argue? It is hard to see how a plausible argument can be made that a crisis is substantially more likely with a debt-to-GDP ratio of 97% than of 86%. Several comparable countries maintain higher debt ratios without any hint of funding problems: in 2017, the US figure was around 108%, the Belgian figure around 104%, and the French figure around 97%.

It is now beyond reasonable doubt that austerity led to increases in mortality rates – government cuts caused otherwise avoidable deaths. These could have been avoided without any substantial effect on the debt-to-GDP ratio. The argument that cuts were needed to avoid a fiscal crisis cannot be sustained.

[1] There is surprisingly little research on the size of nominal multipliers – most work focuses on real (i.e. inflation adjusted) multipliers.

[2] We calculate the actual (past years) or projected (future years) percentage change in the nominal deficit from the OBR figures and reduce this by a third, a half and two thirds respectively. The table below provides details of the middle projection where the pace of nominal deficit reduction is reduced by half.

Training Researchers to Work with Confidential Data: A New Approach

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Prof Felix Ritchie of UWE’s Business School has recently spent time with the Northern Ireland Statistics and Research Agency and makes the following analysis.

I’ve just spent two days at the Northern Ireland Statistics and Research Agency (NISRA), working with them to develop training for researchers who need access to the confidential data held by NISRA for research. This training is jointly being developed by the statistical agencies of the UK (NISRA, the General Register Office for Scotland, and the Office for National Statistics in England and Wales), as well as HMRC, the UK Data Archive and academic partners. The project is being led by ONS as part of its role to accredit researchers under the new Digital Economy Act, with UWE providing key input; other statistical agencies, such as INSEE
in France and the Australian Bureau of Statistics, are being consulted and are trialling
some of the material.

Training researchers in the use of confidential data is common across statistical agencies around the world, particularly when those researchers need access to the most sensitive data only available through Controlled Access Facilities (CAFs). The growth in CAFs in recent years has mostly come from virtual desktops which allow researchers to run unlimited analyses while still operating in an environment controlled by the data holder. There are now six of these in the UK, and many countries in continental Europe, North America and Oceania operate at least one. The existence of CAFs has led to an explosion in social science research as many things that were not previously allowed because it was too risky to send out data (such as use of non-public business data, or detailed personal data) have now become feasible and cost-effective.

All agencies running CAFs provide some training for researchers; around half of these use ‘passive’ training such as handouts or web pages, but the other half require face-to-face training. Much of this training has evolved from a programme developed at ONS in the UK in the 2000s and this training was recommended as an example of ‘best practice’ for face-to-face training by a Eurostat expert group.

However, this style of training is showing its age. Such training typically has two components: firstly how to behave in the CAFs and secondly how to prevent confidential data from mistakenly showing up in research outputs (‘statistical disclosure control’, or SDC). Both are typically taught mechanistically, in the form of dos and don’ts, explanations of laws and penalties and lots of SDC exercises. Overall the aim of the courses is to impart information to the researcher.

The new training is radically different from the old training. It starts from the premise that researchers are both the biggest risk and the biggest advantage to any CAF: the biggest risk because a poorly-trained or malcontented researcher can negate any security mechanism put in place; the biggest advantage because highly-motivated researchers means cheaper system design, better and more robust security and the chance for the data holder to exploit the goodwill of researchers in methodological research, for example.

In this world the main aim of the training is to encourage the researcher to see himself or herself as part of the data community. If this can be established then the rest of the training follows as a consequence. For example, knowledge of the legal environment or SDC is shared not because it keeps you out of jail but because everyone needs to understand this so the community as a whole works. This gives the course quite a different feel to more traditional courses: much of the day is spent in open-ended facilitated discussions exploring concepts of data access.

The training was designed from the ground up in order to take advantage of recent developments in thinking about data access and SDC. This was also done to avoid being restricted by having to ‘fit’ preconceived ideas about what worked or not; material was included on its own merits, not whether “this was what we used to do…”. For example, the previous SDC component had a large number of numerical examples, developed over many years, leading to attendees remarking on afternoons spent “doing Sudoku”. We reviewed every example to identify the minimum set of principles needing to be explored and then wrote a small number of new examples based on this minimum set. On the other hand, the previous training had relatively little to say about the context for checking outputs for confidentiality breaches; this has now been expanded as it fits with the ethos of understanding why things are done.

Of course, this was not all plain sailing. The original structure, trialled in June 2017, had just one presentation before being comprehensively abandoned. Modules have dropped in and out and been moved around. The initial test for the course has been completely rewritten (a topic for a later blog). Various sections have been inserted as ‘options’ to take account of regional variations in operating practices. Throughout this, multiple organisations have been able to feed into the process so that the final product itself has a sense of community ownership.

We are now at the stage of training-the-trainers to enable independent delivery around the UK. This is already generating much feedback for the future development of the course: for example, a need has arisen for ‘crib sheets’ to help in the facilitation of certain exercises. Overall, however, we are confident that we have a well-structured, informative, course that meets the needs of 21st century data training.

Further reading: for more information on the evidential and conceptual basis for the course, see Ritchie F., Green E., Newman J. and Parker T. (2017) “Lessons Learned in Training ‘Safe Users’ of Confidential Data“. UNECE work session on Statistical Data Confidentiality 2017. Eurostat. 

Happiness in Bangladesh: The Role of Religion and Connectedness

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Dr Tim Hinks, Senior Economics Lecturer at UWE, in conjunction with fellow academics Joe Devine and Arif Naveed have published this paper in the Journal of Happiness Studies


Abstract
Research into the relation between religion and happiness offers inconclusive evidence. Religion seems to matter but it is not entirely clear how and why. Moreover much of the research to date is rooted in western experiences. This article analyzes primary data from Bangladesh to examine how religion figures in people’s wellbeing and life chances. It identifies differences in reported happiness between the country’s two largest religious populations: Muslims and Hindus. Our main argument is that the significance of religion is only really understood when considered alongside social, economic and political processes. The data and analysis make an important contribution to the limited knowledge we have of the relation between religion, political connectedness and happiness in non-western societies. It also highlights the need to incorporate more contextualizing analyses into our assessments of the relation between religion and happiness.

Introduction
1.1 Religion and Wellbeing
Academic interest in the connection between religion and happiness has grown significantly over recent years, and produced an impressive body of scholarship. Many studies demonstrate a positive association between religion and happiness. The significance of this association should not be underestimated. For example Witter et al. (1985) reviewed 28 wellbeing studies and found that the majority reported a positive association between religion and subjective wellbeing. Moreover they found that religion accounted for 2–6% of the variation in subjective wellbeing. Ellison et al. (1989) went one step further arguing that the effect of religion on subjective wellbeing is as strong if not stronger than income. This finds some support in Luttmer’s claim that religion is positively correlated with measures of subjective wellbeing even when demographic variables such as income, age and marital status are taken into account (Luttmer 2005).

In what ways then does religion make us happy? The evidence offered by the literature falls broadly into two categories, reflecting a distinction first introduced by Allport and Ross’s (1967) pioneering work into religious orientation. According to Allport and Ross, people have intrinsic or extrinsic motivations in relation to religion. The latter sees religion as a means to achieve particular goals including non-religious ones while the former is autonomous and considers religion as an end in itself. Although this distinction is not without its critics (see Lavrič and Flere 2007), it has left its mark on research into religion and happiness. On the one hand therefore it is argued that religion enhances wellbeing because it offers access to support structures or enables individuals to cope with stress (Lim and Putnam 2010), or to adapt preferences or aspirations (Clark 2012). On the other hand, religion enhances wellbeing because it offers a sense of meaning and purpose, and acts as a moral compass in this as well as the ‘after-life’ (Greeley and Hout 2006). What is striking however is that we can find evidence of both intrinsic and extrinsic benefits of religion in all of the world’s major religions including Islam (Sahraian et al. 2013), Hinduism (Ganga and Kutty 2013), Judaism (Levin 2014), Buddhism (Elliot 2014), and Christianity (Steiner et al. 2010). Although the effects of religion on wellbeing are generally reported as being positive, there are important counter observations. First, religion may also be a factor in producing negative wellbeing values. Ellis (1962) for example reports that excessive religion can produce depression and mental disorders. More recently, Mookerjee and Beron’s cross country analysis of the relation between religion and happiness concluded that contexts with high levels of religious fractionalisation produce relatively lower levels of happiness (Mookerjee and Beron 2005). Second, much of the literature draws conclusions on the effects of religion from studies that focus entirely on individual level processes. As such the context is overlooked. Some recent work has warned of the dangers of this approach arguing that positive individual level effects disappear when contextualised with a country’s overall level of religiosity (Eichhorn 2012). Third, it is important to acknowledge the bias in the literature towards religious experiences and contexts in the West with relatively little attention being paid to non-western contexts where the parameters of any discussion about religion and wellbeing may be radically different (Joshanloo 2013, 2014). Finally, most of the literature rests on an assumption about the direction of causality. Thus it is assumed that religion leads to happiness as opposed to happiness leading to religion.

1.2 Religion and Wellbeing in Bangladesh
Our research focuses on the relation between religion and wellbeing in Bangladesh, and as such contributes to the nascent scholarship focusing specifically on wellbeing in countries of the Global South (Diener et al. 2013; Shams 2016). Bangladesh is a particularly appropriate location in which to examine wellbeing dynamics since it throws up a number of wellbeing puzzles which all reflect different aspects of the Easterlin paradox (Easterlin 1974). Thus in the 1990s, Bangladesh reported higher levels of happiness than many other countries, including the UK, where people enjoy significantly larger per capita incomes and access to a wider range of basic services and good (Worcester 1998). Since the 1990s, the country has made significant progress in reducing poverty and introducing socio-economic improvements (Devine and Wood 2017), and can be described as a global international development success story. Despite this however, levels of reported happiness seem to be declining (Asadullah and Chaudhury 2012). Improved living standards therefore seem to be having an impact upon the wellbeing expectations and demands of its citizens (Diener et al. 2013).

The early years of state formation in Bangladesh were anchored in a very clear commitment to secularism, and indeed early writings on religion, most notably Islam, emphasised its syncretic and malleable qualities (Uddin 2006). However since the early 1990s, a different expression of religion has emerged which has been described as neo-orthodox, militant, and extremist (Riaz 2004). These changes reflect deeper questions about what constitutes ‘proper’ Islam in Bangladesh and also what constitutes a ‘Muslim democracy’ (Devine and White 2013). The unresolved nature of these questions is etched visibly in the relations between the dominant Muslims and followers of other religions in the country. Muslims in Bangladesh constitute around 87% of the population. While the remaining 13% belong to a number of different religions, Hinduism is by far the largest minority religion in the country.

In Bangladesh religion is directly translated as dharma, a term which derives from the Sanskrit dhr meaning to sustain, support or uphold (Mahony 1987). However dharma means more than just ‘religion’, at least as understood in the West. Etymologically, dharma refers to the ‘proper cosmo-moral ordering’ of things (Inden 1985). In this sense, everything that exists, animate or inanimate, has its dharma. Even religion has its own dharma. Second, the word dharma is used in everyday speech to ask about one’s religion. So it is quite common in Bangladesh to ask: ‘apnar dharma ki?’, i.e. what is your religion?. The response to this question however reveals two things. First, it communicates a person’s religious affiliation. Second, the declaration of a religious affiliation or identity provides important implicit information on which social groups you belong to and can interact with; what practical lifestyle choices you can or cannot make; what constitutes appropriate behaviour and conduct; what aspirations you might have; who you can marry, what food you can eat, and so forth (Kotalova 1993). Dharma therefore is as much about everyday practical choices and opportunities as it is about religious affiliation.

There is very little literature on the relation between religion and wellbeing in Bangladesh. The founding research projects which inform this paper,1 found statistically significant correlations between religion and happiness, especially among older respondents (Camfield et al. 2009). In more qualitative follow-up research, we identified a number of areas where the influence of religion on wellbeing comes to the fore including the structuring of community relations (Devine and White 2013), responsibilities, obligations and expectations around marriage, gender and intergenerational relations (White 2012), and the development of political culture and democracy (Basu et al. 2017).

Recently Asadullah and Chaudhury (2012) offer a very different argument. Analysing data from 2400 households across 12 districts in Bangladesh, the authors claim that neither religion nor gender had any significant impact on happiness. Instead they found that the influence of inter-personal relations and social trust on happiness was statistically significant. This opens up a new avenue into an equally under-researched area, i.e. trust. The only study on trust we could identify was Gupta et al’s (2013) comparative analysis of the behaviour of Muslims and Hindus in Bangladesh and West Bengal in India. In the latter, Hindus constitute the majority group and Muslims the minority; whilst in the former, the opposite is true. In both sites, the authors found that identity based on status (i.e. being a member of the majority or minority group) rather than religion per se determined levels of trust and trustworthiness. We return to this finding in our  Sect. 3 below.

Our research makes three important contributions. First, to the best of our knowledge, the findings presented here are the first to quantitatively look at the impact of religious identity on people’s self-reported happiness in Bangladesh. Second, given that the analysis is anchored in Bangladesh our research offers an important contribution to a literature that is dominated by Western experiences and understandings of religion. Finally, the article contributes to the growing but still relatively thin literature on wellbeing and happiness in the Global South.

For the full paper see http://bit.ly/2FcGkGP

 

Degree Algorithms: Equity and Grade inflation

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In his recent working paper Dave Allen highlights the substantial differences in the way that university degree calculations can be made.

The algorithms UK universities use to calculate a student’s final degree outcome can be complex and sometimes counter-intuitive; some commentators suggest that they have contributed to ‘classification inflation’ across the UK higher education sector. A less well understood concern is that the variety in algorithms potentially means the same set of marks can be awarded a different classification depending on what university the student attended.

The 17 questions and answers below aim to clarify the issue.

1.         Is grade inflation happening?
The recent HESA data on degree qualifications confirms a continued increase (or inflation) in the proportion of ‘good honours’ (1st and 2:1s) being awarded – from 68% of all graduates in 2012/13 to 75% in 2016/17 Likewise, the proportion of first has increased from 18% to 26%.  While the numbers cannot be disputed, the cause is.

2.         Why is it occurring?
According to the Cambridge pro-vice chancellor for education, Professor Graham Virgo, grade inflation is not “a cause for concern” and is “down to tuition fees because students are more motivated and are working harder”. Alternatively, others like Nick Hillman, director of the Higher Education Policy Institute claim, “Universities are essentially massaging the figures, they are changing the algorithms and putting borderline candidates north of the border,” (The Telegraph)

3.         Have there been changes to university degree Algorithms?
There have been significant changes to degree algorithms in the last 10 years. The recent report by  UUK-GuildHE (Understanding Degree Algorithms, Oct 2017) found that many HEIs had changed their algorithms – primarily to ensure internal consistency between departments and faculties, but also to achieve “competitor or sector alignment” (page 18). (see also Higher Education Academy’s 2015)

4.         What is a degree algorithm?
Degree algorithms describe the process universities use to translate module outcomes into a final degree classification (1st, U2, L2, 3rd). The algorithm software calculates the weighted average of the ‘counting’ modules, this average mark then determines the classification.

5.         What is a weighted mark?
Degrees are made up of a number of modules and can have different credits e.g. 10, 15, 30, 20, 40 etc., students typically study 120 credits a year or 360 credits in total. The weighted average takes account of different module sizes (credit weightings). To calculate a weighted average the module marks are first multiplied by their credits, these weighted values are then added together; finally, this total is divided by the total value of credits.

6.         Are all algorithms the same?
While all UK universities adopt the same classifications, how universities arrive at these classifications is a very different matter. The variation comes in how the average of each ‘counting’ year is weighted and whether some module marks are ‘discounted’ or removed from  the calculation.

7.         What is a ‘counting’ year?
Simply those years of study included in the degree calculation, it is notable that most UK  universities do not include year 1 marks in their algorithms – the focus is on year 2 and 3.

8.         Why is there a greater weight on year 3 studies?
The higher weighting given to year 3 marks captures the notion of the student’s ‘exit velocity’ or  the standard that the student is performing at as they graduate from university. Alternatively,  the higher weightings on year 3 might reflect a university’s requirement that programmes must become more challenging as students progress through them.

9.         Is each counting year weighted equally?
There is wide variation in the weightings applied to year 2 and 3 marks. This can range from 50/50 [Oxford Brookes] to 20/80 [Derby].

10.       How does the year weighting affect the degree mark?
This is best illustrated using an example. Assume the year 2 and 3 average marks are 64.38% and 69.00% respectively. If weighted equally [50/50] the combined average would be 66.69%, if weighted 20/80, this combined mark increases to 68.08 – an increase of 1.39% – all because a greater weight has been placed on the year 3 average mark. It follows that had the year 2 and 3 average marks been switch around, the increase in the overall average using a 20/80 weighting would be smaller [i.e. 65.30%].

11.       How does discounting a module affect the weighted average?
Discounting or, removing the lowest marks can only improve the overall degree average. It follows also that “If only the worst, outlying marks are omitted, it is possible that this would lead to grade inflation” (UUK-GuildHE p.37).

Again, we can use a worked example to show the impact. From the previous example, if we exclude the lowest marks for 30 credits (in each year) the year 2 marks become 69.17% (up from 64.38%), the year 3 marks become 70.83% (up from 69.00%). Applying the same weightings the degree mark increases to 70.0% (50/50) and 70.5% (20/80) – the 2:1 is now a 1st. It follows also that the differences between those algorithms that discount and those that do not, will become greater as the discounted module marks get lower.

12.       How common is discounting?
Without some central ‘register of practice’, it is hard to say exactly. The UUK-GuildHE survey suggests that up to a third of those universities contacted use discounting. It follows also that a large proportion of those universities that discount also apply differential weightings. The gradual shift in the use of discounting has probably been the significant driver behind grade/classification inflation.

13.       What is a borderline candidate?
Most algorithms take the degree ‘average’ to either one or two decimal points e.g. 69.5% or  69.45%. This results in borderline marks where the exam board is a called upon to determine what classification is awarded. There are various methods, one includes using a simple rule whereby marks equal to or less than 0.5% below a classification boundary are awarded the higher classification ‘automatically’ and confirmed by the exam board (thus a 1st does not start at 70%, it starts at 69.5%). Alternatively, marks within a given band (e.g. 68.5% – 69.49%) might be granted an ‘uplift’ in classification (e.g. from a U2 to a 1st) using the preponderance principle: a 1st could be awarded if the student has 60 credits in the higher boundary in their final year. Not surprisingly, these borderline adjustments can have a significant impact on individual student’s classification and the overall profile for a given programme.

14.       How do the different weightings and discounting effect a
university’s overall results?
The distribution of the degree classifications can vary significantly depending on the algorithm   used. Figure 1 shows a simulation using the same set of marks for a number of students (211 in total) where 6 different algorithms are applied. The first four algorithms (UNI[1] to UNI[4]) have  different weights for each counting year (Y2 and Y3 only), these weights range from 50/50 to 25/75, the fifth algorithm (UNI[5]) ‘discounts’ 20 credits from each year and uses a 25/75 weighting. For comparison, the sixth algorithm (UNI[6]) uses all years of study, equally weighted (which would be the outcome if the Grade Point Average (GPA) was applied – see below).

The impact is quite dramatic. In terms of the different weightings alone (UNI[1] to UNI[4]) the proportion of 1st ranges between 16% to 23%. The difference increases significantly once discounting is applied (UNI[5]), form 16% up to 32%. In Figure 1 the proportion of students achieving a 2:2 (awarded where the average mark falls between 50-59%) also declines significantly from 28.9% (UNI [1]) to 18% (UNI[5]). This simulation suggests a student’s post university ‘life chances’ may be significantly dependant on how their chosen university determines their classification (all other things being equal).

15.       Do most students understand the degree algorithm that applies to them?
A good question. The simpler the algorithm the more likely the students will understand its implication, if not use it to set personal academic targets. However, the truth is that many algorithms are very complex, and many use more than one rule to determine the degree classification. Here the interested reader might like to see a YouTube video posted by Sheffield University, in particular the comments below this video. It is also very likely that students do not take into consideration the degree algorithm when choosing a university.

16.       What is the bigger problem Grade inflation or Equity?
While the national data shows significant increases in the proportion of 1st and U2 being awarded, we cannot definitively say there has been ‘grade inflation’ – to determine this we would need the actual module marks. The increase in 1st and U2 is likely to be a combination of students working harder and gradual changes in degree algorithms. What we can say – with some certainty: is it is a concern that under the current system the same set of marks can result in such a wide range of degree outcomes. If equity and rigor are to be the hallmarks of UK higher education provision, these differences cannot be ignored or defended.

17.       What can be done about it?
If valid comparisons between students’ achievements are to be made, it is follows that all universities should adopt the same algorithm when classifying degree outcomes. In this context the consistent use of the USA GPA classification system (or similar) has clear benefits. Jonathan Wolff (professor of philosophy at University College London) accepts that adopting the GPA is a “move in the right direction” but also takes the view that “we should simply issue students with transcripts to record their study, and leave it at that (Guardian).  This is a laudable idea but one which students (and employers) might find difficult to accommodate.

Allen, D. O. (2018) Degree algorithms, grade inflation and equity: the UK higher education sector, Bristol Centre for Economics and Finance, Working Paper 1803,