The Persistent Consequences of Adverse Shocks: How the 1970s Shaped UK Regional Inequality

25 Pages Posted: 22 Sep 2020

See all articles by Patricia Rice

Patricia Rice

University of Oxford

Anthony J. Venables

University of Oxford; Centre for Economic Policy Research (CEPR)

Date Written: September 2020

Abstract

The economic shocks experienced by the UK economy in the 1970s brought major changes in the spatial distribution of employment rates in the UK. This paper traces out the long run implications of these changes, suggesting that they were highly persistent and to a large extent shape current UK regional disparities. Most of the Local Authority Districts that experienced large negative shocks in the 1970s have high deprivation rates in 2015, and they constitute two-thirds of all districts with the highest deprivation rates. We conclude that neither economic adjustment processes nor policy measures have acted to reverse the effect of negative shocks incurred nearly half a century ago.

Keywords: de-industrialisation, employment, Regional Inequality

JEL Classification: O47, O50, R11, R12

Suggested Citation

Rice, Patricia and Venables, Anthony J., The Persistent Consequences of Adverse Shocks: How the 1970s Shaped UK Regional Inequality (September 2020). CEPR Discussion Paper No. DP15261, Available at SSRN: https://ssrn.com/abstract=3696340

Patricia Rice (Contact Author)

University of Oxford

Mansfield Road
Oxford, OX1 4AU
United Kingdom

Anthony J. Venables

University of Oxford ( email )

Mansfield Road
Oxford, Oxfordshire OX1 4AU
United Kingdom

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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