EC304 Seminar

Week 3

Mode of analysis
Research question: what are they trying to find out?
Analytical premise: what explanatory factors do they think are important?
Methodology: how do they evidence and demonstrate their argument?

Source:
Journal of Political Economy
Publishes work in ‘economic theory and practices’ in areas including fiscal policy,
international finance and industrial organization.

New Political Economy

Publishes work which ‘combines the breadth of vision which characterized the classical
political economy of the 19th century with the analytical advances of 20th social science’.

Have you looked at the origins or impacts of any policies before? If so, what ‘mode of
analysis’ did you employ?

Notes:
Rule-based policy: there is an objective approach (depoliticize)
Economic paper: usually refine the existing model
Political paper: question the existence of the model
Taking input and placing it in the context of an existing model to analyse impact (mechanistic
approach with quantitative data); politics might ask whether such a mechanism is credible,
and why it works in such a way.
Positivist study (take the world as it is) as opposed to critical or normative (question power
relation, mechanism) study.

Each discipline can bring different themes to the foreground and harness different
methodological strength.
Week 4

Assignment

Describe the context

The rationale of the policy
Stakeholder analysis
Unintended consequences

Places to look for ideas

News
Government proposal
Annual report
Personal Experience

Notes

Critically analyse the benefits and lacking

Comparisons
Motivations for analysis
Focus or narrow down stakeholder groups and consequences – focus on a particular theme.

Activity

From April 2023, the benefit cap amounts were increased for the first time since its
introduction – by 10.1%, the same percentage increase as for social security benefits linked to
inflation.

Raising the benefit cap

Even after controlling for a range of observable characteristics (for example, number of
children), capped households were 4.7 percentage points (41 per cent) more likely to flow
into employment after a year compared to similar uncapped households.

To promote a fair and healthy society and maintain public confidence in the welfare system,
by imposing a reasonable limit on the total amount a household can receive.
To reduce spending on benefits and encourage positive behavioural changes.
To encourage more people into work.

Stakeholder
– poor household
- Government
Week 5

Contextual description:
“Following record high oil and gas price over the past year due to global circumstances, and
to help fund more cost-of-living support for UK families, the government is introducing the
Energy Profit s Levy, a new 25% surcharge on the extraordinary profits the oil and has sector
is making” (Treasury, 26 May 2022)

Policy rationale

Reasoning and justification

Implementation
Objective
Expected outcome
Assumption

How are we sure that fiscal policy can convert to the objective?
What difference will an implementation make?

Economic reasoning – cost of living

Political elements – opposition’s pressure/ political support

Stakeholder analysis
Unintended consequences

Week 6 Reading Economics Paper

Start with the title and the abstract, this should give you a fairly good idea on

1. The question the paper is studying

2. The setting the paper is studying this question in
3. The method/research design they are using
4. The findings

Quasi-Experimental control trial - not RCT

1. Read the introduction (sometimes literature) and the conclusion

a. This gives you more information on the 4 points from before
b. Especially deeper reasoning about the relevance and importance of the question
c. Find relevant literature the paper contributes to – important for your case study
2. If you think that this is one of the papers you need for your case study, go and read it in
detail.
Minimum wages and racial inequality

Fair Labour standard act

Expansion of minium wage federal minimum wage

DiD design

No aggregate effect

Minimum wage policy can play a critical role in reducing racial economic disparities

Week 7: Strategic reading

Research question
- Necessity: a question we need an answer to
- Novelty: Something new (the world is changing)

Argumentative thread – an overarching theme that links all arguments together

Activity: Quantitative easing by a central bank during the pandemic

The important thing to do for the assignment

- Evidence in the prior context

- Why did every central bank acted this way – contextualise – is there a wider trend
- Ground argument
- Fundamental lessons or dynamics
- Relate to other debates

- A bit of politics and economics

Week 8: Data in case study

- Monique de Haan’s intro to econometric course

- The focus of the assignment should be qualitative
- Error term captures the omitted variable; it is the distance between the fitted line and a
single data point.
- OLS line is fitted in such a way such that the sum of the distance is minimised.

- Control can sometimes be hard to quantify

IV
- Instrument needs to affect endogenous variable
- But uncorrelated to the error term
DID
- Compute difference between unemployment in two areas before and after.
- Difference in cross sectional and time series data (panel data)

Regression discontinuity design

- “Random” cut-off that determines treatment
- A threshold for a test score meant certain people get into ivy league and other don’t
despite holding control constant.

Week 9

Who are the significant

Actors
Factors

Many actors are involved, but who are the one that you are focusing on and why

What is policy making like in Malaysia?

Sources of evidence

The September 2022 mini-budget contained £45bn of tax-cutting policies such as lowering
the top rate of income tax and cancelling the planned increase in corporation tax. Amid
adverse market reactions and criticism from expert authorities, just a month later these and
many other policies had been reversed, Kwasi Kwarteng had been sacked and Liz Truss had
resigned. Let’s say we want to argue that the mini-budget was informed by the ideas of
certain right-wing think tanks (policy rationale), which then publicly defended it in the media
(stakeholder analysis). Can you find an appropriate source of evidence to this effect? What
precise claims would you be able to make?

Kwasi Kwarteng has a long association with Bow Group, one of the oldest right-wing think
tanks; but it doesn’t suggest a causal relationship, hence requires more build-up.

Inference from source, but also be self-reflective on why that is the case: care there other
reasons?

Writing style

How should the policy case study be written differently from these three sources?
1. The Wikipedia entry in the ‘September 2022 United Kingdom mini-budget’
2. The National Institute of Economic and Social Research (NIEST) blog on the
Truss/Kwarteng Mini Budget One year on
3. A chat gpt response to the prompt Explain the origins and outcome of the 2022 UK mini-
budget
Determine an overview of the argument; don’t cite Wikipedia – it is not analytical but
descriptive. It does highlight some important quotes that we can trace back and cite.

No argument – but descriptive, opinion base. The organisation’s own response show that they
disagree with the budget; we can cite that for context of not all think tanks support the
budget.

Statements that guide, but do not cite

Term 2 week 1

Policy
Policy rationale
Criticism of the policy

Norms and presumption in economics

State roles in protection and welfare support: extension or contraction

Politics on punishing the incompetent who take the opportunity or alleviating the poor
(pension, benefits)

Term 2

Week 3
Reflection on first assignment

Week 4

Problematisation as a verb refers to the process by which something is given shape as a

‘problem’

What is the problem?

Revising the curriculum to keep up with the industrial 4.0 trend
How to equip children with the skills to survive and thrive in a future labour market
transformed by technology.

How is this legitimised as a problem?

Existing education inequality and lack of focus on key skills; and opportunity during the
pandemic.
Ramping up the idea of opportunity cost and the economic payoff for doing so
Highlighting collective losses
Highlighting individual losses
Highlighting overall alignment with civic engagement and sustainable goals
What concepts and conditions does it depend on?
Historically lower investment in education
Investment in education is necessary

What and who is excluded from the problem?

Focus on low-income economies

Starting point for policy problem:

(1) Own experience of injustice, inequality and inefficiency
(2) Respond to current affairs controversies that relate to the economy

Take Higher education funding and identify different problems that have been and could be
attached to it. Consider problems for different groups and problems in different contexts.
Brain drain

Week 5

Economic Data

Labour policy
Education policy
Population by highest degree
Years of schooling
Share of people able to read
Gender gap in educational attainment

Database: census data from different countries, world bank, ourworldindata, European
commision

Healthpolicy

Life expectation
Child mortality
Health expenditure, public, private
Fertility/ mortality
Prevelance of diseases (malaria, influenza, smallpox, etc.)
Mental health

Database: WHO, Centres for Disease control and prevention, OECF, Ourworldindata

Which data might be useful?

Where can I find this data?

Office of National Statistics
Homelessness statistic from government – statutory homelessness

House price to earning ratio

Median house prince
House mortgages repayment changes

Housing policy

House prices
Rent
Share of homelessness
Overcrowding
Rental stock
Amenities

OECD, Transaction Database

Environmental policy
Week 6

The data we need depends on the problem we are dealing with and the proposal we want to
make. Let us assume we are convinced about the economic merits of a tax on red meat. How
could we make the case that this is politically feasible and desirable in the UK?

- Public support, opinion polls

- Government support, policy maker quotes

Parties have different ideologies and agendas; perhaps it is not a policy for now and
will be when there is a change in government.

- Stakeholder position, press release

How much does the government give weight to stakeholder positions and opinions?
Academic evidence shows how policy is formed and whether stakeholders hold an
important position.

- Policy lessons, from similar policies in the UK or the same policy in other countries

Policy worked, but how can it be refined further.

How feasible is its implementation in the context of international trade
E.g.:
Ipsos, YouGov, Hansard, Nexus Uni, self-published documents like reports or newsletter
(‘grey literature’)

Interrogating political data

How can a policy be justified: progressive?

Case study
Switzerland look at red meat tax
Compared to the EU, people in switzerland will have to pay 2.3 times more for red meat
consumption

Acceptability of the tax policy is not determined

The framing of the policy – environment/ unhealthy – doesn’t matter
The difference lies in the approach in structuring the policy

The population express acceptance towards indirect approach

Sustainable diet education, no subsidies for meat advertising, stricter requirement in livestock
farming.

But react strongly towards direct intervention

VAT exemption for vegetable food – unacceptable among the food industry and political
parties (positive incentives)
VAT increase for meat products (negative incentives) – political parties, interest group, food
industry
Limiting shares of meat products in retail assortments

General perception that the government shouldn’t define or dictate people’s food choice
Swiss buy more and more meat across the border

Limited effect
A three year consecutive of increasing the price of meat, appetite for meat decline by around
2 percent per capita.
Food tax are not effective in reducing nitrogen surpluses as consumer do not react uniformly
towards an increase in price, overall impact is minor

Week 7

Presentation

Week 8

Ask

Week 9
Process evaluation

- Short term and long term goals

Quantitative evaluation
- Data analysis of food waste statistics before and after policy implementation (measure
of food waste in UK)

- Government tax revenue and cost of implementation - Cost benefit analysis = whether
this is the best policy to implement.

- Collective strategy

Qualitative evaluation
- Interview with the policy implementors – enforcement and regulatory environment
that is suitable for the policy

- Active monitoring and the necessary human resource for it; measuring food waste/
ideal infrastructure – food waste bags

- Questionnaire to collect feedbacks from the beneficiaries - should we invest in

education or packaging that nudges against food waste

- Consumer backlash against programme that encourages consumption of healthy food,

will similar backlash occur in the case of UK – communication is important

- Media coverage

- Exposure to policy

UK produce highest amount of food waste in Europe

9.5 million tonnes of food waste in a single year

Environmental concerns in regards to food waste – loss of resources and environmental

impact due to production process that involves multiple

Prevention should focus on household as they constitute the major proportion of food waste
in UK

Notes

Contextual description

- Comparativism with countries who do the same

Policy implementation/ redefinition

Stakeholder analysis
Policy evaluation
- How to make sure policy is a success – Do A, B , C
- To assess with policy – matrix A, B, C
- What is the policy gap that cannot be determined thus far

The root cause of the problem – can we stop it at the root

Creating a regulatory environment that makes implementation easy – internalising the idea of
recycling.

Week 10

Contextual description

Ground argument in context

Past effort
Country to country performance
Is there any public support
Government support

*Well well-design policy is required for a good transition

Policy rationale

How to facilitate the transition

Evaluation

What makes a policy successful?

Why does the prior quota not work
What are some quota that can be introduced
Nuance?

Developed and development

Emphasis the benefit of doing this
Countries might see the benefit
Embedded incentives