Tagged / economics

AFE seminar 31st October – Streamlining finance for SMEs: the solution of automated pre-filled VAT returns

Join us for the Accounting, Finance and Economics (AFE) seminar, taking place on Thursday 31st October at 2pm.

The AFE seminar for this semester will be delivered by BU’s Dr Siamand Hesami on the topic of Streamlining finance for SMEs: the solution of automated prefilled VAT returns. 

Digital transformation in tax administrations has gained global momentum as governments seek to enhance efficiency and service delivery. The seminar will examine the financial and economic impacts of a key digital innovation: prefilling value-added tax (VAT) returns.

Using Chile as a case study, the analysis evaluates the net benefits and costs from both government and taxpayer perspectives. The results demonstrate that prefilling VAT returns can significantly reduce taxpayer compliance costs, presenting a strong case for its adoption.

For Chile, this initiative’s economic net present value is estimated at US$5.66 billion, with US$1.729 billion in benefits to the private sector and US$3.391 billion in positive budgetary impact for the government. Sensitivity analyses confirm the robustness of these findings, except in scenarios where changes in taxpayer compliance significantly affect government revenues.

This research highlights prefilling VAT returns as an effective strategy to reduce compliance costs, close the tax gap, and minimise the risk of audits and tax evasion, offering valuable insights for broader applications in tax administration.

The seminar takes place in F108 (Fusion Building) from 2pm.

Conversation article: Hayek’s Road to Serfdom at 80 – what critics get wrong about the Austrian economist

Dr Conor O’Kane writes for The Conversation about the impact of Friedrich von Hayek’s book 80 years after its publication…

Hayek’s Road to Serfdom at 80: what critics get wrong about the Austrian economist

Conor O’Kane, Bournemouth University

“The most powerful critique of socialist planning and the socialist state”, is how Margaret Thatcher described Friedrich von Hayek’s book, The Road to Serfdom. Published in March 1944 during the Austrian economist’s tenure at the London School of Economics (LSE), the book has been enduringly popular among free-market liberals.

Among its admirers was Winston Churchill, who as prime minister released 1.6 tons of precious war-rationed British government paper to allow additional copies to be printed. More recently Elon Musk tweeted a photo of The Road to Serfdom with the caption “Great Book by Hayek” to his 174 million followers, no doubt bringing Hayek’s work to a new generation.

On the other hand, the Austrian is often seen by the left as an intellectual bogeyman, an enabler of unfettered greed, minimal social responsibility and soaring inequality.

So who was Hayek and why does The Road to Serfdom matter?

How laissez-faire fell out of favour

Born into an upper middle-class Vienna family in 1899, Hayek earned doctorates in law (1921) and political science (1923) at the city’s university. He first made a name for himself in economics in 1928, publishing a report for his research institute employer that predicted the Wall Street crash of 1929 (some critics argue that his achievement gets exaggerated).

Hayek spent 18 years at the LSE (1932-1950), before moving to the University of Chicago (1950-1962). There he worked alongside Milton Friedman, another seminal advocate for free-market principles.

These views were profoundly unfashionable at the time. The social democrat consensus had been shaped by the “robber barron” period of the late 19th and early 20th centuries. Key industries such as rail and oil had been dominated by cartels and monopolies, leading to massive wealth inequalities.

Then came the Wall Street crash and great depression, prompting a loss of confidence in economists and economic reasoning. Free-market capitalism took much of the blame. Socialism was offered as a realistic and even desirable alternative.

Prominent colleagues of Hayek’s at the LSE, including political scientist Harold Laski and sociologist Karl Mannheim, believed socialist planning was inevitable in the UK. The Labour party explicitly warned in a 1942 pamphlet against a “return to the unplanned competitive world of the inter-war years, in which a privileged few were maintained at the expense of the common good”.

Copy of the Road to Serfdom

Hayek disagreed. He thought this wave of popular “collectivism” would lead to a repressive regime akin to Nazi Germany.

In The Road to Serfdom, he accepted the need to move beyond the laissez-faire approach of classical economics. But he argued in favour of “planning for competition” rather than the socialists’ “planning against competition” approach. He opposed the state being the sole provider of goods and services, but did think it had a role in facilitating a competitive environment.

In a central theme of the book, Hayek described the difficulties that democratic decision-making would face under central planning. He believed it would lead to policy gridlock and present opportunities for unscrupulous characters to become the key decision-makers.

Hayek’s goal was to show that the British intelligentsia was getting it wrong. Socialist planning, he believed, would see citizens returned to the types of limited freedoms endured by serfs under feudalism.

Hayek and conservatism

The Road was especially popular in the US. This was helped by Reader’s Digest publishing a shortened edition in 1945, introducing Hayek to a non-academic audience of some 9 million households. He was seized upon by conservatives opposing Franklin D Roosevelt’s interventionist New Deal, who feared for the loss of personal freedoms and a drift to totalitarianism.

However, Hayek was concerned his ideas had been oversimplified and misinterpreted. He warned of “the very dangerous tendency of using the term ‘socialism’ for almost any kind of state which you think is silly or you do not like”. By the mid-1950s he had distanced himself from American and European conservatives.

Ultimately, though, after the second world war most western countries adopted a more Keynesian approach. Named after Hayek’s greatest intellectual rival, John Maynard Keynes, this involved using government spending to influence things like employment and economic growth.

Hayek’s work, meanwhile, was mostly ignored until the 1970s, a period during which the UK became mired in stagflation and industrial action. He then became the inspiration for Margaret Thatcher’s policy mix of deregulation, privatisation, lower taxes and a bonfire on state controls of the economy. With the US also facing domestic economic challenges, the then US president, Ronald Reagan, followed suit.

What the critics say

If that was perhaps peak Hayek, he has been heavily criticised from some quarters in recent years. The American economist John Komlos, in his 2016 paper, Another Road to Serfdom, convincingly argues:

Hayek failed to see that any concentration of power is a threat to freedom. The free market that he advocated enabled the concentration of power in the hands of a powerful elite.

Such over-concentration had created the “too big to fail” environment in the financial sector in the run-up the global financial crisis of 2008, and many thought Hayekian deregulation was the culprit.

More recently, the tax-cutting economic policies during Liz Truss’s short stint as UK prime minister were incubated by think tanks who regard themselves as the keepers of the Hayekian flame. Similarly, Argentinian president Javier Milei’s libertarian vision of a minimalist state is said to be influenced by Hayek.

Equally, however, it is easy to fall into that trap of oversimplifying Hayek. It is worth noting, for instance, that in the Road, he also envisaged a substantial role for the state. He saw the state providing a basic minimum income for all. He also argued that “an extensive system of social services is fully compatible with the preservation of competition”.

Even Keynes congratulated him on his publication, saying, “morally and philosophically I find myself in agreement with virtually the whole of it”.

In short, while it’s probably fair to say that the world has had to suffer the flaws in Hayek’s ideas, it is important to separate him from his supporters. He was certainly no statist, but his vision for how best to run an economy was not as uncompromising as many would have us believe.The Conversation

Conor O’Kane, Senior Lecturer in Economics, Bournemouth University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Social Capital in Crises: Waves in Climate Change, Oil, Economic Shocks and Migrations – Local Economic Development Impacts in Europe

A talk by BUBS Professor Dr Davide Parrilli, member of BU University Senate and the external editorial board on “European Planning Studies.” Hosted at the Committee Room, Fifth Floor, Poole House, BU Talbot Campus, Fernbarrow, 2-3pm, Wednesday, 22 November, 2023. This important cross-disciplinary seminar welcomes all, being of high relevance to current global news.

“Local Economic Development and the Challenge of Critical Social Transformations”

Abstract
“Local economic/production systems have been a focus of actions and discussion for many years across Europe. Within an evolutionary perspective, these systems change and adapt to respond to new changing scenarios, challenges and demands of the wider social and economic community. It is the case of the challenges raised by climate change and 2016 Paris Agreement or the recent COP27 in Sharm-el-Sheikh, or by exogenous shocks to supply and demand due to present international crises. In this presentation the discussion centres around the evolution of local economic systems and identifies a specific challenge and gap that could and should be addressed soon both theoretically and from a development policy perspective. This is the social capital linked to the important migration waves that have modified the social spectrum of European socio-economies and are producing a strong impact on the way local economic development works. Open discussions and dynamic and comprehensive actions are required to address these important transformations, whilst recognising the “social embeddedness of economic action” and promoting the social capital that ignites the competitive capacity of these local economic systems.”
Best wishes,
Davide

M. Davide Parrilli, PhD (Birmingham), MPhil (Sussex), SFHEA, FeRSA
Professor of Regional Economic Development
BUBS PhD Programme Coordinator
BUBS Output Champion
Professorial Member of University Senate
Bournemouth University Business School
AACSB Accredited; SBC Accredited; EFMD Member
& Associate Editor/Editorial Board of “European Planning Studies”

Posted by Fiona Vidler MBA MSc MLIBF – Note: For any further information or RSVP this Free Event, please do contact direct the esteemed BU Professor Dr Davide Parrilli dparrilli@bournemouth.ac.uk

Conversation article: What the right gets wrong about Adam Smith

Dr Conor O’Kane writes for The Conversation about the Scottish philosopher and economist Adam Smith…

What the right gets wrong about Adam Smith

John Kay, 1790.
Wikiwand

Conor O’Kane, Bournemouth University

What to make of Adam Smith? You might have thought we would have straightened this out, given that he only ever wrote two books and it’s been 300 years since he was born. But no. Everyone wants to claim the Scottish philosopher and economist as one of their own. With the exception of Jesus, it’s hard to think of anyone who attracts such radically different interpretations.

Part of the problem is that we actually know very little about the man. Smith oversaw the burning of all his unpublished writings as he lay on his death bed – a common practice at the time, but not much help in settling endless arguments.

What we know is that he was born in the town of Kirkcaldy on the east coast of Scotland. His father was a judge who died just before he was born. Smith seems to have been a very scholarly child, rarely seen without a book about his person.

One early experience that seems to have affected him concerned the town market. Certain landowners were exempt from Kirkcaldy’s bridge tolls and market stall charges due to the town’s status as a royal burgh. This gave them a competitive advantage over their competitors, which did not sit well with the young Smith.

He left his mother at the age of 14 to study moral philosophy at the University of Glasgow, before completing his postgraduate studies in metaphysics at Balliol College Oxford. Thereafter he went on to spend his life studying, teaching and writing in the fields of philosophy, theology, astronomy, ethics, jurisprudence and political economy. Most of his career was spent as an academic in Edinburgh and Glasgow, though there were also stints as a private tutor in France and London.

The Wealth of Nations

The two books that Smith published in his lifetime are The Theory of Moral Sentiments (1759) and his more widely known, An Enquiry into the Nature and Causes of the Wealth of Nations (1776). The latter, a rambling 700-page text published over two volumes, was 17 years in the making.

Original edition of Adam Smith's Wealth of Nations
What it’s all about.

The dominant economic ideology of the time was known as mercantilism. It viewed economic value simply in terms of the amount of gold that a country had to buy the goods it needs. It gave little consideration to how goods were produced – either the physical inputs or the human motivation.

But for Smith, motivation was at the heart of economic behaviour. He saw it as an all-purpose lubricant that delivers mutual benefit for all:

It is not from the benevolence of the butcher, the brewer or the baker, that we expect our dinner, but from their regard to their own interest.

Smith’s observations about how the division of labour can be organised to increase productivity remains one of his most enduring contributions to economics. Improving productivity is still seen as the holy grail for countries getting richer. Larry Fink, head of investment giant BlackRock, has only just been arguing that artificial intelligence could improve productivity, for instance.

The battleground

The Wealth of Nations is an eclectic text – even an “impenetrable” one, according to the director of the Adam Smith Institute. Smith argues that slavery and feudalism are bad and that economic growth and getting people out of poverty are good.

He thinks high wages and low profits are good. He also warns against things like cronyism, corporate corruption of politics, imperialism, inequality and the exploitation of workers. In observations about the British East India Company, which was the Amazon of its day and then some, Smith even warned about companies becoming too big to fail.

Those on the right of the debate often cite Smith’s “invisible hand” phrase from the Wealth of Nations in support of their worldview. Borrowed from Shakespeare’s Macbeth, the phrase actually appears only once in the whole text. It is a metaphor for how a “free” market magically brings buyers and sellers together without any need for government involvement.

In more recent times, “invisible hand” has come to mean something slightly different. Chicago School free market advocates like Milton Friedman and George Stigler viewed it as a metaphor for prices, which they saw as signalling what producers wanted to produce and buyers wanted to buy. Any interference from government in terms of price controls or regulations would distort this mechanism and should therefore be avoided.

Ronald Reagan and Margaret Thatcher were disciples of this way of thinking. In a 1988 speech encouraging his people to be thankful for the prosperity that comes from free trade, President Reagan argued that the Wealth of Nations “exposed for all time the folly of protectionism”.

Yet those on the left also find plenty in Smith that resonates with them. They often cite his concern for the poor in the Theory of Moral Sentiments:

This disposition to admire, and almost to worship, the rich and the powerful, and to despise, or, at least, to neglect persons of poor and mean condition, though necessary both to establish and to maintain the distinction of ranks and the order of society, is, at the same time, the great and most universal cause of the corruption of our moral sentiments.

In 2013, President Barack Obama cited Smith in a speech to support raising the US minimum wage:

They who feed, clothe and lodge the whole body of the people should have such a share of the produce of their own labor as to be themselves tolerably well fed, clothed and lodged.

States and abuses

So how to square this circle? The truth is that Smith’s writing has enough ideas and inconsistencies to allow for all sides to cherry pick references as required. But one argument I find compelling, which has been put forward by the economist Mariana Mazzucato, is that many of those who champion laissez-faire policies misinterpret Smith’s notion of a free market.

This is linked to the fact that Smith was writing at a time when the British East India Company was responsible for a staggering 50% of world trade. It operated under a royal charter conferring a monopoly of English trade in the whole of Asia and the Pacific. It even had its own private army.

Benjamin West painting 1765 about the British East India taking tax control over Bengal
Mughal Emperor Shah Alam conveying tax-collecting rights for Bengal, Bihar and Orissa to the British East India Company, Benjamin West 1765.
Wikimeda, CC BY

Smith was presenting an alternative vision for the UK economy in which such state-licensed monopolies were replaced by firms competing against one another in a “free” market. Innovation and competition would provide employment, keep prices down and help reduce the appalling levels of urban poverty of the time. This was capitalism. And ultimately Smith was proved correct.

But Mazzucato argues that when Smith talked about the free market, he didn’t mean free from the state, so much as free from rent and free from extraction of value from the system. In today’s world, the equivalent example of such feudal extraction is arguably global tech firms like Amazon, Apple and Meta playing nations off against one another to minimise their regulations and tax liabilities.

This doesn’t sound like the sort of “free” market that Smith envisaged. He would probably be cheering on the EU’s anti-trust case against Google, for instance. Those who believe that Smith saw no role for the state in managing the economy ought to reflect on how spent his final years – working as a tax collector.The Conversation

Conor O’Kane, Senior Lecturer in Economics, Bournemouth University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

The curious start of an academic collaboration

international

The curious start of an academic collaboration

Two days ago a group of academic from Bournemouth University (BU) submitted a bid for a research grant to the NIHR (National Institute for Health Research) to help prevent the drowning of toddlers in Bangladesh.  The proposed research is a collaboration with the RNLI (Royal National Lifeboat Institution), and an other UK university, the University of the West of England (UWE) and a research organisation called CIPRB (Centre for Injury Prevention and Research, Bangladesh).   Nothing particularly out of the ordinary there.  BU academics submit collaborative bid for research grants all the time, with colleagues at other universities, with large charities (like the RNLI), and with research institutes across the globe.  What I find intriguing is the round-about way this particular collaboration came about within BU.

The NIHR called for research proposals in reply to its Global Health Transformation (RIGHT) programme.  The RNLI approached CIPRB, an expert in accident prevention from UWE and BU experts in health economics and human-centred design to discuss putting in an intention to bid.  The RNLI has a history of working with both CIPRB in Bangladesh on drowning prevention and with BU in various design project (including improved ball bearings for launching lifeboats).  The team decided that it needed a sociologist to help study the social and cultural barriers to the introduction of interventions to prevent drowning in very young toddlers (12-14 months).  My name was mentioned by our UWE colleague whom I know from her work in Nepal.  For example, she and I had spoken at the same trauma conference in Nepal and the lead researcher on her most recent project is one of my former students.

Thus, I was introduced to my BU colleagues in different departments (and faculties) by an outsider from a university miles away.  I think it is also interesting that after twelve years at BU I am introduced to fellow researchers at the RNLI, especially since I only need to step out of my house and walk less than five minutes to see the RNLI headquarters in Poole.

Prof. Edwin van Teijlingen

CMMPH (Centre for Midwifery, Maternal & Perinatal Health)

 

The Government’s Areas of Research Interest

The Parliamentary Office of Science and Technology (POST) have released a new opportunity for research colleagues:

In April POST ran a survey of experts on the COVID-19 outbreak expert database that resulted in the publication of syntheses about the future effects of COVID-19 in different policy areas. From this survey POST developed Parliament’s first Areas of Research Interest (ARIs) which are lists of policy issues or questions that policymakers are particularly interested in.

Currently only the ARIs which are linked in some way to Covid have been released. However, they are not all health based and touch on a range of themes from crime, economics, inequalities, trade, supply chains, mental health, education, sustainability across several sectors, and so on.  Do take the time to look through the full question list to see if it touches upon your research area.

Alongside the publication of the ARIs is an invitation to experts to add current or future research relevant to the topics to a repository that Parliament may use to inform future policy making and Parliamentary work. Research with relevant research across any of the disciplines are invited to submit their work.

BU colleagues are strongly encouraged to take advantage of this rare opportunity to present their research to policy makers. The Policy team is here if you need any help. If you’re ready to go please do respond to the call directly, afterwards please let both the Policy team and your faculty’s Impact Officer know that you have responded.

Amsterdam is European Capital of Innovation 2016

Business Engagement, innovation, international, Knowledge Exchange, Knowledge Transfer

euflag

Following the announcement of a shortlist of nine cities (including Glasgow and Oxford in the UK) in January, Amsterdam has emerged as the winner of the 2016 European Capital of Innovation Award.

The city was chosen for its “holistic vision of innovation related to four areas of urban life: governance, economics, social inclusion, and quality of life” by a panel of independent experts – “for embracing a bottom-up approach based on smart growth, startups, livability and digital social innovation.”

An interesting read and some interesting videos and presentations from  the winners and runners up and those short listed.

Useful information for those following research into such topics as  smart cities, innovation , ecosystems.

In full.

Press release.

 

Current EU tenders open for applications

Europe’s Capacity to Tackle Demographic and Societal Change: The purpose of this call is to support a partnership of not-for-profit research bodies, public institutions and civil society organisations, to focus on collection and dissemination of key facts, figures, trends and policy analysis regarding demographic change across the EU. The ultimate aim of the partnership’s work will be to reach a wide non-specialist audience and to promote a well-informed public debate on its implications and appropriate policy responses among the general public in all Member States and at all levels of government. Deadline 11.09.12

A Profile of Current and Future Audiovisual Consumers: The study should aim at understanding the behaviour, preferences and orientations of audiences for films in general and, in particular, of young audiences. To that end, it should include in-depth interviews with, in particular, 10–15 and 15–25 year olds to learn more about their consumption patterns and their perception of current ways of marketing European films, series, etc.; i.e. could different or earlier marketing change their behaviour? The study should investigate the impact of different marketing tools including the use of social media. Furthermore it should analyse some of the existing film literacy initiatives and their impact on the future consumption patterns. The role of social networks for audiovisual consumption should be analysed. The study should be implemented by experts/consultants, who have in-depth experience with market research. Deadline 13.08.12

Economic Impact of Social Enterprises: The main objective of this call for proposals is to contribute to the availability of reliable statistics on social enterprises at national and European levels and to identify countries interested in collecting this information.  The aim is to provide policy makers and stakeholders with credible, comparable and systematic information and indicators on the role of social enterprises in national economies and to offer usable and practical information to support decision making. The Commission wishes to encourage national statistical offices in Member States to collect this information, so although other organisations dealing with the promotion of social enterprises (including universities and research organisations) are eligible applicants for the call, all proposals must involve national statistical offices. Deadline 07.09.12

Prevention of and Fight Against Crime Programme: Of most interest to BU under this scheme are action grants for transnational and national projects, for which there will be a budget of €78m in 2012. A series of targeted calls for proposals for action grants to support projects concerned with five specific policy areas were recently announced. Each has a deadline for submission of applications in August 2012  In the main, opportunities exist for HEIs to apply for support to undertake studies and analyses in specific areas and to establish networks of expertise. There are also limited opportunities to develop and deliver training courses for law enforcement professionals, prosecutors and judges and to identify and disseminate best practices in relevant fields.

LifeLong Learning Programme- Implementation of the European strategic objectives in Education and Training (ET2020): This call for proposals is for projects to fulfil the objectives for 2012-2014 in two separate parts:-  Part A: Support for raising awareness around and the national implementation of European cooperation in education and training. Part B: Support for the implementation of innovative learning environments using ICT (called ‘creative class-rooms’) in the development and implementation of transversal education and training policy issues linked to the priorities set out in Europe 2020 and ET 2020. Deadline 01.10.12

Pilot project Economy of cultural diversity: In the Communication ‘A Digital Agenda for Europe’ the Commission identified the need to push ahead with the creation, production and distribution of all platforms of digital content. To this end the European Parliament voted a budget line in the 2012 budget for a ‘Pilot project on the economy of cultural diversity’ which ‘would aim to create an open laboratory to test innovative approaches to deal with content for innovation and digital sharing and distribution. It would be therefore a way to explore new business models respecting diversity in the production and distribution chain’.  The aim of this pilot is to highlight and promote 10 to 15 ideas which make innovative use of ICT based technologies to finance, produce, make available, disseminate and/or extract value from cultural contents. Projects should facilitate access to culture (including cultural heritage) and cultural literacy via online devices and promote cultural diversity in the digital environment.

Preparatory Action Culture in external relations: The specific objective of this contract is to formulate recommendations for a strategy on culture in European external relations which will build on synergies with existing processes and will involve a high number of stakeholders in Europe and representatives of third countries, including cultural institutes and NGOs. Deadline 17.08.12

Regional Innovation Monitor 2013-2014 – RIM Plus: The EU’s Regional Innovation Monitor (RIM http://www.rim-europa.eu/) serves over 200 EU regions in 20 different countries. Under this call for tenders the Commission wishes to establish a service that will provide regional administrators with a reference framework for the development of more efficient innovation strategies. An inventory innovation strategies at regional level in Europe will be kept updated and made available to those actors involved in developing policy measures in support of innovation.  The service contract will provide users (regional authorities and stakeholders, Member States’ central administrations, the Committee of the Regions, various services of the Commission, experts, businesses and universities) with an overview of the state of development of regional policies and strategies on innovation and on the difficulties and successes of their implementation in the regions. Deadline 31.08.12

Business Innovation Observatory: The European Commission wishes to tender for a service contract to develop a Business Innovation Observatory. The Business Innovation Observatory is a three-year project with the aim to provide European policy makers with analysis and intelligence on latest novel business and industrial innovation trends, activities and models on a regular basis. The emphasis will be placed on the business micro-perspective and how it relates to the wider institutional, political, socio-economic, legal and policy contexts. The analysis will be complemented by the development of appropriate policy recommendations at European and national levels. The tool should be seen as complementary to quantitative analytical instruments, most notably the Commission’s European Innovation Scoreboards. Deadline 10.09.12

 

links for 2011-04-06

Delicious links

Funding opportunities:

  • ESRC – DFID-ESRC Growth Programme The Department for International Development (DFID) and the Economic and Social Research Council (ESRC) are partnering in a new programme on economic growth in developing countries. The DFID/ESRC Growth Programme will fund world class scientific research on issues relating to inclusive economic growth in Low Income Countries (LICs), with high potential for impact on policy and practice.
    (tags: research funding)
  • EPSRC logoEPSRC Fellowships in Manufacturing – EPSRC EPSRC is looking, in a Pilot call, to support a number EPSRC Fellowships in Manufacturing who have the potential to be future research leaders in their field in Manufacturing Research, supporting either academics who have recently (within the last three years) moved from industry, or people in industry, currently involved in innovation, looking to move into academia. (tags: research funding earlycareer epsrc)

If you are interested in applying to either of these calls, talk to your R&E officer in CRE Operations.