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The persistent consequences of adverse shocks: how the 1970s shaped UK regional inequality

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  • Patricia G Rice
  • Anthony J Venables

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 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 had 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.

Suggested Citation

  • Patricia G Rice & Anthony J Venables, 2021. "The persistent consequences of adverse shocks: how the 1970s shaped UK regional inequality," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 37(1), pages 132-151.
    • Handle: RePEc:oup:oxford:v:37:y:2021:i:1:p:132-151.
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    File URL: http://hdl.handle.net/10.1093/oxrep/graa057
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    5. Alan B. Krueger, 2017. "Where Have All the Workers Gone? An Inquiry into the Decline of the U.S. Labor Force Participation Rate," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 48(2 (Fall)), pages 1-87.
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    Cited by:

    1. Anna Stansbury & Dan Turner & Ed Balls, 2023. "Tackling the UK’s regional economic inequality: binding constraints and avenues for policy intervention," Contemporary Social Science, Taylor & Francis Journals, vol. 18(3-4), pages 318-356, August.
    2. Lee, Neil & Fransham, Mark & Bukowski, Pawel, 2024. "Spatial labour market inequality and social protection in the UK," LSE Research Online Documents on Economics 122224, London School of Economics and Political Science, LSE Library.
    3. Luisa Gagliardi & Enrico Moretti & Michel Serafinelli, 2023. "The World’s Rust Belts: The Heterogeneous Effects of Deindustrialization on 1,993 Cities in Six Countries," NBER Working Papers 31948, National Bureau of Economic Research, Inc.
    4. Colantone, Italo & Ottaviano, Gianmarco & Stanig, Piero, 2021. "The backlash of globalization," LSE Research Online Documents on Economics 113860, London School of Economics and Political Science, LSE Library.
    5. Patricia Rice & Anthony J.Venables, 2022. "Tradability, Productivity, and Regional Disparities: theory and UK evidence," Working Papers 021, The Productivity Institute.
    6. Luisa Gagliardi,, "undated". "The World’s Rust Belts: The Heterogeneous Effects of Deindustrialization on 1,993 Cities in Six Countries," RF Berlin - CReAM Discussion Paper Series 2317, Rockwool Foundation Berlin (RF Berlin) - Centre for Research and Analysis of Migration (CReAM).
    7. Overman, Henry G. & Xu, Xiaowei, 2024. "Spatial disparities across labour markets," LSE Research Online Documents on Economics 121453, London School of Economics and Political Science, LSE Library.

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    More about this item

    Keywords

    regional inequality; de-industrialization; employment;
    All these keywords.

    JEL classification:

    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O50 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - General

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