History lessons as May joins Macron in Brexit Love Island

Morning all,

Britain faces some big challenges – but I bring news of significant progress. Love Island is over, fini, terminado. Praise be – it’s destroyed both productivity and conversation quality in RF towers. But don’t worry if you like nothing better than Brits flying off to awkwardly stay with people they hardly know in a posh Mediterranean villa – Theresa May’s visit to Emmanuel Macron’s bolt hole in the South of France will fill the gap.

As our female leader faces European leaders in the role of an underdog, the auguries are good for ardent Brexiters ­– this week marked the 430^thanniversary of the Battle of Gravelines – when Elizabeth I’s fleet inflicted sufficient damage on the Spanish Armada to deter them from the plan to support an invasion of our island. So maybe that feat can be repeated as Theresa May fights her way to Brexit victory. Or maybe the relationships between European powers and the means to promote our national self-interest have changed over the last half a millennium. Who knows…

Either way, this week’s reading has a historical flavour to keep you entertained over the weekend. Finally, Top of the Charts (ie me and the family) are taking a short break in August so I’ve added some podcasts to help you through the long summer nights… We’ll be back on 24 August.

Best,

Torsten

Director, Resolution Foundation

Northern names. This is going to be a controversial one. Our north/south economic divide is big – from earnings to investment it can be seen in both data sets and the real world as you travel round the country. But what lies behind these gaps? Most of us think that industrial shifts and a concentration of economic and political leadership in London might have something to do with it. But new research comes to a very different conclusion. It analyses shifts over the past 200 or so years with the novel method of using surnames to identify who does and does not come from a “Northern background”. They classify people according to which region their surnames originated from centuries back, and then track surnames as they moved around the country. Their conclusion: the North’s performance can be explained by its most productive and educated citizens persistently migrating south, while migrants from South to North tend to be below average on these measures. The authors conclude there is NO regional problem in England. Innovative work, bonkers conclusion.

Importing social mobility. Continuing our historical theme, we’ve long know that different countries have very different levels of inequality and social mobility based on variations in our cultures, institutions and economies. Some have also explicitly linked inequality and social mobility – with the so called Great Gatsby Curve showing that more unequal countries (like the US) also have less mobility between generations than more equal countries (like Denmark). Some new work builds on that idea, by looking at how inequality and mobility varies across parts of the US based on which European migrants moved there. The almost too neat conclusion is that differences within America mirror current differences in the countries that European migrants came – so you get higher social mobility in areas dominated by descendants of Scandinavian immigrants, lower levels in places where the Italian, French, or Germans settled. It’s lower still in areas with…. British ancestral origins. I hope we’re all proud of ourselves.

How likely is ‘likely’? If someone tells you something is a ‘serious possibility’, how likely do you think it is to happen? A classic CIA briefing from 1951 used this phrase in angsting about the chance of a Soviet attack on Yugoslavia and provoked a debate about how people reading the intelligence were supposed to know how likely such an attack actually was. Now an innovative study updates previous CIA work on the psychology of probabilities, to try to understand how the general public interprets expert analysis. Key takeaways: we should use numbers not words – especially not phrases like “a real possibility” where different people think it can mean anything from a 20 to an 80 per cent chance of something happening.  The authors also think would be experts should make their forecasts very concrete so everyone will know if you got them right or wrong – clearly career ending advice for anyone making predictions on British politics these days…

More warfare than welfare. David Edgerton’s new and revisionist history of 20^th-century Britain is looking like one of the year’s must-read books on economic history – not least as it punctures a few cherished myths about the welfare state, national identity, British manufacturing and Britain’s military independence. In the late 1940s the government spent four times more on the military than it did on the welfare state – despite the emphasis in so many histories of the Attlee government. Even more heretically, Edgerton points out the continuity between the inter-war and post-war welfare states – again not what you’ll read in typical histories of the NHS. In case you don’t have time to get through all 720-odd pages, here are a couple of detailed reviews from Left Outside and (shorter!) Tyler Cowen.

Summer listens. To get you through a tough fortnight without Top of the Charts, we thought we might go wild and recommend some informative listens as well as the normal reads this summer. If you want some recent history/nostalgia for a pre-Trump age I’d highly recommend Making Obama – which focuses on his formative years. If you want to go much further back, Mike Duncan’s revolutions podcast – which spans the English Civil War, uprisings across North and South America, and the many many revolutions in France – is well worth subscribing too. And if 400 years of revolution isn’t big enough for you, check out The History of Rome. Makes Brexit seem like a tea party.

Chart of the week…

The headline from our latest Resolution Foundation Earnings Outlook was that the pay premium for workers changing jobs has exceeded 10 per cent for the first time since the early 2000s. But despite this growing ‘disloyalty bonus’, the proportion of workers who have voluntarily switched employment recently is well down on pre-crisis levels, particularly so for younger workers. That’s bad news for workers – low job mobility can hold back pay and career progression – bad for firms who, while benefitting from holding on to staff, will struggle to fill new posts, and bad for the economy as it stunts productivity growth.