Super spuds and smashing the patriarchy Top of the Charts 17 November 2023 Torsten Bell Afternoon all, The Autumn Statement pre-briefing is well underway. The latest is that the Government is fed up with people who left their last role years ago just sitting around, announcing tougher sanctions if they don’t take a role when offered. Which at least explains why David Cameron took the Foreign Secretary gig. We get the new OBR forecasts and Chancellor’s (bigger than we were expecting) announcements on Wednesday, so the Resolution team are preparing for a long night’s number crunching. At 9am on Thursday we’ll bring you the lowdown on what it all really means. Come along to our briefing, with the Chairs of the OBR and Treasury Select Committee. This week’s reads have a supply side theme to appeal to the inner ‘Truss’ in you – from the benefits of more homes, female job applicants and….potatoes. COTW gives you some important context to one of the big decisions facing the Chancellor: whether to cut benefits. Again. Have a great weekend. Torsten Chief Executive Resolution Foundation Productive potatoes. This is interesting. On a very grim topic. New research gives us insights into the post-Soviet experience of digging for victory survival. We all know GDP went through the floor in the 1990s in Russia and other ex-Soviet Republics, but the paper reminds us of the hardship sitting behind that: many people simply not having enough to eat (see the first chart), with lasting effects on the height as adults of those who were then children. To understand more about how people coped, the authors have dug into… potatoes, which hard-hit households often planted (60 per cent reported that they grew potatoes in this era). The scale of the impact of growing potatoes was shaped by the suitability of areas for growing them, but the impact was noticeable: potato-growing seems to have added 5.6cm taller to the height of affected children (when adults). Powerful potatoes. Hyped housing. Everyone loves a bit of replicability (well, almost everyone). The latest paper to make news by trying to replicate a famous finding comes from Brian Greaney who examines a paper that claimed relaxing land-use restrictions in three major cities would boost US GDP by a whopping 3.7 per cent. Reader, replicate it he could not. Instead, he finds major issues with the author’s coding and modelling. Once amended, their model does show that deregulation would raise GDP by only 0.02 per cent. Ouch. Leaving aside the techy maths rows in here, there is a general lesson about treating claims of huge impacts for changes (especially ones we favour) with a pinch of salt. Beating bias. By now you’re all very familiar with prejudicial-hiring experiments – the same application is sent to multiple organisations with only one key characteristic shifted. In the case of this read (short summary) it’s gender. What’s interesting is that this paper looks across 85 hiring bias studies (spanning 26 countries, 44 years since the 70s, and nearly 400,000 fake applications) to see how things have changed. But that’s not all – they also polled punters and experts to see if they could predict bias level, and how it might have changed over time. Turns out that, at least in this instance, things aren’t anywhere near as bad as people think. Women experience lower levels of bias than anyone expected, and that bias has become vanishingly small in recent years. If anything the bias now is against men trying to break into fields dominated by women. So, is the patriarchy dead? Not so much given we know what most of those female-dominated fields have in common: low pay. Pointless preferences. This is very reassuring news for those of us who’ve got kids sorting out their secondary school for next year. A study tracks students in Amsterdam who headed to secondaries between 2015 and 2020. The students provide school preferences but around a fifth don’t get their first choice under a lottery system. Does it make any difference? Well yes, to the type of school they attend. Children who don’t get their first choice go to schools a bit further from home, and tend to have less experienced teachers and poorer peers. But what difference does that make to any academic outcomes, or indeed to students’ civic engagement/friendships/personality? Absolutely none. Medieval moments. Humans might not change much, but economic cycles do. So researchers tell us after pondering nine European economies between 1300 and 2000. We’re used to long periods of expansion, punctuated by short recessions, but it turns out this is a uniquely modern phenomenon (since 1950 expansions lasted an average twelve years vs one year for your average contraction). Back in ye olde days (pre-19th Century), we spent as much time contracting as expanding, with much shorter/volatile cycles that countries basically went through alone. The authors note that what started changing things in 19th Century was the reduction in the quantity/length of contractions more than accelerated growth during booms. The 21st Century rapid fire set of shocks leads the authors to ponder if something has changed – and to suggest it might be a good idea to avoid big contractions going forward. Thanks for that Sherlock. Chart of the week Inflation is down, falling to 4.6 per cent in October from 6.7 per cent in September – the sharpest drop in over 30 years. Good news. But… there could be a sting in the tail. The Government is reportedly considering moving the goalposts on benefits uprating, using the lower October rate, not the higher September figure (which is the default way to uprate benefits). This would be a cut plain and simple. The context here is key: it would build on many a previous cuts, as COTW shows. We’ve got in the habit of not letting benefits rise with inflation since 2010, add in other benefit cuts since then and the impact on low-and-middle income Britain is staggering: the poorest fifth are around £2,700 a year worse off as a result. And that’s just the average. When people wonder why so many families are struggling today, this is a key part of the answer. It’s why inequality hasn’t fallen despite a surging minimum wage and employment gains being focused among poorer households. Then there’s the more recent context: the inflation shock of the last two years. With the cost of essentials like food and energy rising fastest this has hit poorer households hardest (we estimate that prices have risen by around 14 per cent more for families in the bottom income decile than those in the top). Against that backdrop not even having benefits keep pace with inflation is madness.
