Economics Observatory | Questions and answers about coronavirus and the UK economy

Sanctions on Russia: what are the ramifications of this new trade war?

Following the invasion of Ukraine, Western sanctions have targeted Russia’s trade, companies, individuals and financial sector. The measures, which are far more wide-ranging than those following the annexation of Crimea in 2014, raise big legal and economic issues for the world trading system.

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Lessons from history

What can we learn from the role of coal in the Industrial Revolution?

Coal played an important role in the Industrial Revolution, but the air pollution it created eventually acted as a drag on economic growth. As we seek to achieve a net-zero economy, there are important lessons from the energy and industrial transitions ushered in by coal.

Banks & financial markets

What would the currency options be for an independent Scotland?

If Scotland were to become independent from the rest of the UK, it would need to decide what currency to use. Options include sticking with sterling, creating a new national currency or joining a monetary union, such as the eurozone.

Energy & climate change

Why are UK energy prices rising?

Gas and electricity are becoming more expensive, largely because of rising import costs. The recent increase in the price cap set by Ofgem, the UK’s energy market regulator, saw bills go up for millions of households across the country.

Public spending, taxes & debt

Would taxes on unhealthy foods reduce obesity?

Taxing unhealthy foods like sugary drinks makes them relatively more expensive, potentially encouraging people to buy more healthy alternatives. Evidence shows that such taxes do reduce consumption and that firms reformulate their products, with beneficial effects on health.

Aid & international development

How is the war in Ukraine affecting global food security?

War in the ‘breadbasket of Europe’ is having a big impact on food security across the continent and the wider world. Crop shortages and the rising prices of food, fuel and fertiliser could become a source of further conflicts.

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Business, big & small

What next for the growth of women’s football?

Women’s football matches are attracting record crowds, but funding still lags far behind the men’s game. Clubs that are putting money into their women’s teams are seeing the positive effects, but biases in perceptions of quality and potential are limiting further investment.

Business, big & small

How is the cost of living crisis affecting retailers and their customers?

Retail sales are falling. As many consumers struggle to afford basic products, their spending habits and where they shop are changing. Some retailers are struggling to stay profitable, as sales decline while the costs of goods, energy, transport and staff rise.

Nations, regions & cities

What would it take to level up the UK?

The government’s levelling up agenda seeks to reduce disparities across the UK. Policies to boost economic performance will need to attract workers and firms away from London and the South East and improve opportunities in ‘left-behind’ places – but success depends on significant investment.

Attitudes, media & governance

Does public trust in government matter for effective policy-making?

Whether encouraging citizens to pay taxes, get vaccinated or obey the rule of law, governments can achieve more from compliance than coercion. Given recent political scandals around the world, including those in the UK, rebuilding trust will be vital for tackling future crises.

Lessons from history

Sterling crisis: what are the historical precedents?

The pound is currently weak against the dollar and, to some extent, the euro. Past currency crises show that the sterling exchange rate can be vulnerable to expectations about the economy, which today may be influenced by the cost of living crisis, post-Brexit trade and prospects for growth.

News

Overheating

Record-breaking temperatures in the UK this week highlight the danger posed by climate change. And the fires spreading across Europe warn of the steep environmental and economic costs that lie ahead, all while people battle to stay afloat amid the escalating cost of living crisis.

Charities & volunteering

What happens to charitable giving in a recession?

Like households and businesses, charities are facing rising costs. At the same time, many will see demand for their services grow as the economy weakens. While recessions don’t necessarily lead to a fall in donations, the funds available to charities are declining in real terms.

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