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The academic and policy-oriented literature increasingly quantifies the wider effects of energy policy on the macroeconomy. However, the spillovers from economic policies to energy use are less frequently recognised, meaning that many policymakers who strive to improve productivity whilst simultaneously targeting emission reduction fail to consider these interactions. This paper addresses this issue by using simulation results generated by introducing an exogenous increase in labour productivity in a computable general equilibrium model calibrated with data from the United Kingdom. Theoretical analysis suggests that increasing labour productivity can have positive or negative effects on employment levels and energy use. However, the simulation results show that in the context of a developed open economy, improved labour efficiency will increase employment, a key policy objective, but simultaneously increase energy use. A key policy implication is that this work highlights the need for policy frameworks that explicitly acknowledge and quantify the interconnections between national economic policy strategies and energy policy objectives. Secondly, it shows that in practice, policies to reduce carbon emissions need to be strengthened alongside policies to improve productivity successfully implemented. [ABSTRACT FROM AUTHOR]

This paper constructs a regional dynamic macroeconomic model with an eclectic, broadly Keynesian and behavioural flavour. The model, which is parameterized on Scottish data, is used to identify the impact of expectations and business confidence on regional resilience. Simulations compare the evolution of the regional economy after a temporary negative export shock under a range of investment functions. The mainstream perfect foresight formulation generates a reduction in activity, which is small and is limited to the duration of the shock. The heuristic-based, imperfect-information investment models produce more negative, longer-lasting and unstable adjustment paths. [ABSTRACT FROM AUTHOR]

This paper analyses the impact of London-based higher education institutions (HEIs) on the English economy. When we treat each of the HEIs as separate sectors in conventional input-output analysis, their expenditure impacts appear rather homogenous, with the apparent heterogeneity of their overall impacts being primarily driven by scale. However, a disaggregation of income by source reveals considerable variation in their dependence upon public funding and ability to draw in income/funding from external sources. Acknowledging the possible alternative uses of the public funding and deriving balanced expenditure multipliers reveals large differences in the net-expenditure impact with the source of variation being the origin of income. The institutional multiplier is driven by the ability to attract external funding, which would typically favour research-intensive institutions. However, the impacts of students’ consumption expenditures are also significant. In terms of ranking of multipliers the overall results are mixed. [ABSTRACT FROM PUBLISHER]

Carbon capture and storage (CCS) is a technically feasible deep decarbonisation solution. Still it is not widely adopted, arguably due to some basic political economy and policy challenges. One issue is the large infrastructure needs of transporting and storing CO 2. However, a more fundamental challenge in the current UK industrial policy landscape is concern over introducing new costly capital requirements in industries that need to retain competitiveness in a world that has not yet fully signed up to the 'net-zero' transition demanded by the more ambitious 1.5 degrees Celsius warming target of the Paris Agreement. We take the example of high-value chemicals industries operating in the UK devolved region of Scotland and use an economy-wide computable general equilibrium (CGE) model to consider the nature and potential extent of export, GDP and employment losses under different illustrative polluter/government/taxpayer pays approaches to meeting the higher cost requirements. We conclude that the value from subsidising capture activity depends on the extent of export demand response to competitiveness losses resulting from firms bearing CO 2 capture costs. However, outcomes reflect trade-offs across different types of sectors and employment, and are also dependent on labour market responses to changing wage and unemployment rates. • Carbon capture involves sustained additional operating capital costs for industry. • Reduced capital efficiency impacts regional prices and industry competitiveness. • Regional GDP, jobs and earnings losses are dominated by capturing industry losses. • The extent of losses is governed by trade responses to reduced competitiveness. • A subsidy approach funded shifts the burden to household or public spending. [ABSTRACT FROM AUTHOR]