University of Glasgow

UNIVERSITY of GLASGOW

CPPR

Regional Impacts of National Policies

REGIONAL IMPACTS OF NATIONAL POLICIES

It is important to assess how policies, and indeed changes in policy regimes, that are not primarily conceived as instruments to address geographic imbalances can foster or hamper local economic adjustment.  This Project involves:

  • assessing the impact of monetary policy, and exchange rate movements, on UK regions over recent decades. Whilst a considerable amount of work has addressed the differential responses of eurozone economies to changes in monetary policy, research into differential regional and sectoral impacts within the UK, particularly given their differential external orientations, is surprisingly undeveloped.  It is important to have some sense of these impacts on Scotland (and other regions), both while UK monetary policy is set by the Bank of England, and when considering the prospect of full participation in EMU
  • establishing the extent and role of regional public finance within the EU and the UK: it is relevant to determine the extent to which automatic stabilisers operate at a regional level.  The extent and role of automatic stabilisers is brought into sharper focus within the fiscal constraints of the eurozone's stability and growth pact.  With the progress of devolution there is also growing scrutiny of patterns of resource allocation and calls for both increased fiscal autonomy at a regional level and greater local influence on social security spending.  We would aim to consider how the UK approach to the territorial allocation of funds (Barnett formula) contrasts with the approaches followed elsewhere in Europe.  The development of inter-regional models, see Theme 1, also allows simulation and analysis of a range of possible policy changes.
  • exploring the regional implementation of UK wide labour market policies.  The impact of systems for incapacity benefit and job seekers allowance on unemployment and sickness trends will be considered, along with policies aimed at reintegrating discouraged workers back into labour market participation.  

Journal articles, discussion papers and policy articles

Regional Impacts of Monetary Policy

Darby, J., & Phillips, H. (2007) Exploring the Implications of UK Monetary Policy for Sectors of the UK and Scottish Economies, Discussion Paper 16

Press Release http://www.cppr.ac.uk/media/media_18128_en.pdf

Darby, J. & Phillips, H. (2007) Assessing the impact of monetary tightening: a sectoral analysis of the UK and Scottish economies, FAI Quarterly Economic Commentary, April.

Fiscal Decentralisation and Fiscal Discipline

Darby, J.,  Muscatelli, A. & Roy, G. (2005) Fiscal Consolidation and Decentralisation: A Tale of Two Tiers, Fiscal Studies, 26(2): 169-196.

Darby, J., Muscatelli, A. & Roy, G. (2005) How Do Sub-Central Government React to Cuts in Grants Received from Central Governments Evidence from a Panel of 15 OECD Countries, Discussion Paper 1

Darby, J., Muscatelli., A. & Roy, G. (2005) Fiscal Federalism and Fiscal Consolidation: Evidence from an Event Study, Discussion Paper 2

Conference and seminar presentations

Regional Impacts of Monetary Policy

Darby, J and Phillips, H (2006) 'Exploring the Implications of UK Monetary Policy for Sectors of the UK and Scottish Economies' P resented to CPPR Seminar; to HM Treasury Regional Group (April 2006); at the RSAIBIS Conference, Jersey, (August 2006); at the EUREAL conference in Glasgow, (September 2006); and revised and presented at SES Conference, Perth, (April 2007)

Fiscal Decentralisation and Fiscal Discipline

Darby, J., Muscatelli, A. and Roy, G. (2006) 'How Do Sub-Central Government React to Cuts in Grants Received from Central Governments Evidence from a Panel of 15 OECD Countries' P resented at European Regional Science Association Conference, Volos, (August 2006) and at the EUREAL conference in Glasgow, (September 2006)

Macroeconomic Stability and Fiscal Decentralisation

Darby, J and Roy, G (forthcoming) 'Exploring pro-cyclical bias in sub-central fiscal policy: evidence, likely causes and implications'  presented at a CPPR Seminar, May 2007

Darby, J. and Roy, G (forthcoming)  RSAIBIS Conference, Bangor, August 2007

Project Co-ordinator: Professor Julia Darby
website: http://www.economics.strath.ac.uk/julia/ 

Project Team:  Professor Peter McGregor