economy-and-finance

Economy & Finance

This policy theme includes our work on macro-economics, trade, tax and finance. Our work in this area has looked at the relationship between fairness and a strong economy. In 2010 we will be publishing a report on fairness and the tax system.

Project partners include: Professor Jagdish Bhagwati, Dr Irwin Stelzer, Sir John Sunderland, Baroness Ashton, Sir Samuel Brittan, Larry Summers, Professor Frank Trentmann, John Monks, Robert Chote, Prudential, Trades Union Congress, Institute for Fiscal Studies, City of London Corporation.

Is Free Trade Fair Trade? New perspectives on the world trading system
This collection of essays argued that protectionism and tariff wars will have serious social and economic effects, especially in developing countries where free and fair trade is often a critical feature of combating poverty and maintaining political stability. The authors looked at what we have learned from the history of trade liberalisation and address what could be done today to ensure that trade policy remains a force for prosperity and social justice. Includes chapters by Professor Jagdish Bhagwati, Professor Frank Trentmann, Professor Alan Winters, Ed Mayo, and Harriet Lamb. 2009

Fair Tax: Towards a Modern Tax System
The issue of fairness in the tax system is complex, with many competing voices and interests. In a global age where capital is highly mobile, Britain has to ensure that it attracts inward investment and that its tax system does not act as a disincentive to risk taking and hard work. Balanced against this is the attractiveness of Britain because of the amount of revenue raised and invested in human capital and infrastructure. The authors in this collection debate the strengths and weaknesses of the present British tax system and offer their thoughts on how Britain can have a fairer, more modern tax system. Includes chapters by Robert Chote, Dr Irwin Steltzer, Philip Broadley, and Chris Wales. 2008

Financing the Future
A collection of essays by key experts in the field of developing, financing and planning large scale public infrastructure projects. The contributions offer close analysis of the strengths and weaknesses of a range of different methods of financing sustainable communities; provide a valuable appraisal of specific policy instruments from the perspective of those most closely involved in their use; and draw on international comparisons in order to identify the ways in which such tools can be used more efficiently, effectively and flexibly. Includes chapters by John Healey MP, David Higgins, Dr John Bridge, Gideon Amos, Ray Mills, and Jay Walder. 2005

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nonpartisan public policy think tank | progressive think tank

Additional Information, Read Below.

Public Policy

Public policy concerns the ideas and actions that government (at all levels) and the public sector more broadly undertakes. The actions are attempts to improve an aspect of public life. These actions take various forms and are undertaken by various government bodies and agencies. Such actions vary from passing or repealing a law, cutting or investing in a particular service, to less tangible actions such as calling for people to act in a certain way. Public policy involves consideration of a myriad of factors. These can include the impact on the economy, on individual behaviour, on equity, and on the law. Consideration is often made to the potential un/popularity of the policy. This is not only important for politicians but also the policy’s successful implementation by public servants. New policies also try to change a particular issue ideologically close to those implementing it. For example, a trade off may be made so the health budget receives increased funding whilst the defence budget is cut. Public policy has increasingly become evidenced based. With greater scrutiny and large sums of money involved, policy decisions have to be able to withstand close examination. In many cases government has chosen to scrutinise and evaluate a proposed policy by running a pilot scheme. Given the drive for efficiency and accountability public funded bodies and services have increasingly had to provide statistics on productivity and effectiveness. This complex dynamic between ideology, vested interests, electoral popularity and effectiveness impacts on every decision taken

Growing importance of Public Policy

The importance of public policy has increased as democracy and the state have expanded. Over recent years, the UK government’s expenditure has been around 40% of GDP (peaking during recessions and national crises before subsiding – at its highest it reached 61% in 1942 to 1944). As the public has demanded more action the state has played an ever larger role in attempting to cure societal ills. Not only has the state increased in size since the turn of the twentieth century but expectations have become greater. In recent years public services have come under pressure to deliver greater choice and freedom to citizens who have experienced higher standards of living and who are no longer willing to accept ‘one-size fits-all’ provision. This has meant greater efficiency savings and smarter public policy to deliver the kinds of services people expect. The complexities of public service delivery are only one aspect of the policy debate. With the importance of policy to the economy, business has looked to government to provide the right environment for growth so that they can compete with international firms. Such policy implications include government policy on education, health, rates of tax, labour flexibility, immigration and regulation to name but a few. Policy is also important for those campaigning on issues around poverty, international development, civil liberties, life chances and the environment. With so many different interests and such high expectations the importance of policy has never been greater or, indeed, more complex.

Independent Think Tank

Given the complexities of public policy formulation and implementation, government (and public agencies) have increasingly looked to independent research organisations to inform and improve their accountability, decision making and management. Research think tanks fill the gap between academia and the political world. By giving a platform to new thinking they offer government alternative approaches to policy formulation. They not only offer new approaches but actively try to influence decision making by engaging politicians. In parallel to this, public policy think tanks use the media to apply pressure on government and the opposition to support a particular proposal. These proposals for improved policy come out of research undertaken and events held. Research can vary in form. Often reports are drafted by individual researchers but publications can also consist of edited chapters on a particular theme or a report based on deliberation from an esteemed group of panellists. Effective research is evidenced based rather than purely ideological. Given the complexity of policy making, substantive evidence has to be in place to back up any recommendations. Publications are not only written by researchers, but can also be penned by academics, opinions formers, chief executives, decision makers, trade unionists, leaders from the third sector, civil servants, politicians, and journalists. In addition to research, events are held to debate and discuss issues. These can come in the form of roundtable discussions, seminars, conferences and lectures. By discussing issues with stakeholders it is hoped that a more rounded and nuanced approached to a policy can be found.

Nonpartisan Public Policy Think Tank

The number of nonpartisan think tanks has increased with the professionalisation of politics and growth of single issue campaigns. Most are not-for-profit organisations, independent, nonpartisan and free from government. They rely on grants, donations and contracts for funding. By being independent views and recommendations are more likely to be trusted. Independence is also important in engaging stakeholders. An open forum allows freedom to express new ideas and approaches to policy free of party dogma and politicking. Nonpartisan political think tanks offer new insights and thought leadership on public policy issues. Although think tank research is evidence based and independent there is often ideological bias in what is produced. In the world of policy and politics more broadly nothing can be said to be ideologically neutral. With so many influences, interests and beliefs policy cannot be value free. In reality policy has some normative foundation from which choices and trade offs are made. Research think tanks in the UK tend to have some form of political motivation. Broadly speaking they are either progressive or conservative so come at policy from a particular angle. Whilst this is true of some others look at a single policy areas such as the King’s Fund on health, the Institute for Fiscal Studies on economic analysis, and Chatham House on foreign affairs. Regardless of their particular agenda almost all are nonpartisan, with exceptions including the Fabian Society which is affiliated to the Labour Party or the Bow Group which has links with the Conservative Party.

Progressive Think Tanks

Progressive think tanks, like the Smith Institute, focus their work on issues around social justice, sustainability, equality and fairness. Progressive polices have traditionally looked at how we counter social exclusion to create a fairer more equal society. Progressives believe that by harnessing and shaping the power of the market the interests of the many can be best served. At the heart of progressive thought is the idea that individuals are social beings, and that through mutual endeavour social and economic problems can be overcome. Thus there is emphasis on collaboration rather than just individual action. Given the importance of cooperation issues around democracy and empowerment are stressed. There is also the belief that by being fairer society will also be more prosperous. By having fair provision of social goods the work force will be educated and healthy which will benefit the economy. A fairer society is not only good for the economy but also the individual whose capabilities can best be realised and sense of wellbeing increased. Progressives also stress the importance of sustainability and international development. Not only are these economic necessities they are moral issues as they allow opportunity to be extended to others – be it those in developing nations or to future generations. Modern centre-left thought is not merely about resource distribution but also about shaping institutions, policies and behaviour for the benefit of all. These norms shape the perspectives that progressive research takes. As such research often looks at issues such as health or education through the lens of social justice or equality

The Smith Institute

The Smith Institute is a leading nonpartisan public policy think tank which promotes progressive policies for a fairer society. We provide a high-level forum for new thinking and debate on public policy and politics. Through our research, reports, briefings, monographs, events, lectures, education, and our website, the Institute offers a platform for thought leadership on a wide range of topics. We are interested not only in innovation and new ideas but also in how to translate policy into practice. Founded in 1996 in memory of the late Rt. Hon. John Smith MP, the former leader of the Labour Party who had an all pervading passion for social justice, the Institute seeks to engage politicians, decision makers, practitioners, academia, opinion formers and commentators. The Institute’s activities are informed by a network of well known experts, policy makers, research fellows and patrons. Based in London, the Institute is a not for profit organisation which works in partnership with a range of public and private organisations, other nonpartisan political think tanks, foundations and charities. The Smith Institute has an excellent track record in influencing and shaping public policy, and extensive national and international contacts. Over the last decade we have held over 500 events and published more than 150 reports, with contributions from Prime Ministers and MPs to archbishops and chief executives. The Institute’s work strands include: economy and finance; government and politics; sustainability; business and third sector; local government, cities and regions; housing and regeneration; education and families; health and wellbeing; and EU and international.

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