Improving the Quality of Regional Economic Indicators

Oil Rig

Improving the Quality of Regional Economic Indicators

Summary

Regional economic performance and the devolution of powers in the UK are the subject of increasing interest and attention. Shifts to more localised policy making and Britain’s exit from the EU demand better understanding of the operation of the UK’s internal market, as well as the linkages between different parts of the UK. However, an absence of interregional trade data has proved a significant barrier to detailed analysis. This project addresses this problem by developing frameworks for constructing interregional trade data on a consistent basis for the UK.

Overview

Improved interregional trade flow data is vital to understanding regional economic policy and regional fiscal policy, and to monitoring the principle of ‘no- detriment’ which is central to UK devolution settlements. Accurately measuring and understanding interregional trade is not though a challenge unique to the UK. Research has been undertaken in many countries for the same purpose. Much of this work has focused on ‘top down’ disaggregations of national level data combined with estimation or attribution of interregional trade flows based on survey data. However, this raises a number of issues, particularly around the coverage of surveys and the consistency with which data are collected and reported.

We have examined the range of existing approaches, alongside the particular data landscape of the UK, to better understand how a consistent set of interregional trade estimates covering the whole economy can be produced for the UK. We have produced initial estimates of trade between Scotland, England, Northern Ireland and Wales, using some of the existing approaches and data sources, including freight data, UK Tourism Surveys and interconnector data. These estimates suggest a high degree of trade linkage between the countries of the UK. In the next stage of our work we are developing a strategic approach to the collection of trade information and estimation of trade within the UK, with different approaches for goods and services, and supporting the development of a consistent ‘supply and use’ framework for Scotland, England, Northern Ireland & Wales.

In this project we are also developing regional consumer price indices, building on significant research undertaken by the University of Southampton.

Impact

Our work in this project supports better regional policymaking in the context of ever-increasing interest in regional consumption, activity and trade. The process of producing the estimates and our work with the devolved administrations and Whitehall departments highlight the need for a coordinated effort to improve the coverage and coherence of interregional trade information within the UK. This is leading to new proposals, which have the support of all these organisations, and which have the potential to lead to a transformation in the collection and estimation of inter-regional trade within the UK.

This research has directly contributed to the work by the Office for National Statistics on creating an experimental methodology for estimating the value of UK inter-regional trade in goods and services at International Territorial Level 1, see ‘Experimental methodology for producing UK interregional trade estimates‘.

Outputs

Black. J., Fox, C.,  Gasiorek, M.,  Spowage, M. and Tamberi, N. ‘The economic and socio-economic impacts of trade on the UK labour marketESCoE Conference on Economic Measurement 2023, Special Session B: Novel data approaches to improving the quality and granularity of Input-Output modelling and subnational economic indicators, King’s College London, 17 -19 May 2023

Davidson, S.N.  ‘Addressing the Challenges of Subnational Statistics’ Panel Session I, ESCoE Conference on Economic Measurement 2022, University of Strathclyde, 25-27 May 2022

Davidson, S.N., Connolly, K.,  Crummey,C.,  Brazzelli, N. and Spowage, M. ‘Building a Suite of Subnational Socioeconomic Indicators for the United Kingdom: Opportunities, Challenges and Recommendations’ ESCoE Conference on Economic Measurement 2021, Poster Exhibition, University of Strathclyde 25-27 May 2022

Davidson, S.N., Black, J., Connolly, K. and Spowage, M. ‘Improving the Quality of Regional Economic Indicators in the UK: A Framework for the Production of Supply and Use and Input Output Tables for the Four NationsESCoE Discussion Paper Series, ESCoE DP 2022-14

Davidson, S.N., Connolly, K., Crummey, C., Brazzelli, N. and Spowage, M. (2022) ‘Building a Suite of Subnational Socioeconomic Indicators for the United Kingdom: Opportunities, Challenges and RecommendationsESCoE Discussion Paper Series, ESCoE DP 2022-13

Davidson, S.N. ‘Building a Suite of Subnational Socioeconomic Indicators for the UK: Opportunities, Challenges and Recommendations’ ESCoE Research Seminar Series, 24 February 2022

Spowage, M. and Davidson, S.N. (2021) ‘Improving the Quality of Regional Economic Indicators in the UK: A Framework for Interregional Trade Data Collection and Estimation’ ESCoE Technical Report Series ESCoE TR-13, 9 Dec 2021

Connolly, K. and Spowage, M. (2021) ‘Improving the quality of regional economic indicators: Regional consumer prices’ ESCoE Discussion Paper Series ESCoE DP 2021-13, 28 Oct 2021

Connolly, K. and Spowage, M. ‘Improving the Quality of Regional Economic Indicators: Regional Consumer Prices’ ESCoE Blogs, 28 Oct 2021

Ever-increasing demand for regional statistics: COVID-19 era and beyond’ ESCoE workshop 24 Jun 2021

Multi-sectoral regional modelling workshop’ 27 May 2021 Fraser of Allander Institute, University of Strathclyde and ESCoE

Davidson, S.N., Black, J., Connolly, K. and Spowage, M. ‘Improving Regional Economic Indicators: Interregional trade & Regional Supply & Use’ ESCoE Conference on Economic Measurement 2021, Poster Exhibition, 11-13 May 2021

Brocek, F. and Spowage, M. ‘The effect of COVID-19 on the West Midlands economy’ ESCoE Blogs, 20th Nov 2020

Spowage, M. and Davidson, S.N. ‘UK Interregional Trade Estimation: Estimates of Trade between Northern Ireland, Scotland, Wales and England’ ESCoE Blogs, 30 Jun 2020

Greig, A., Spowage, M. and Roy, G. (2020) ‘UK Interregional Trade Estimation: Estimates of trade between Northern Ireland, Scotland, Wales and England’ ESCoE Discussion Paper Series ESCoE DP 2020-09, 26 Jun 2020

Spowage, M. ‘Interregional trade within the UK – Improving approach and consistency of measurement’ ESCoE Seminar Series, ONS Drummond Gate, 10th Dec 2019

Greig, A., Lisenkova, K. and Roy, G. (2018) ‘A Data Map of Existing UK Data Sources Related to Regional Trade’ ESCoE Discussion Paper Series ESCoE DP 2018-03, 28 Mar 2018

People

Steve Gibbons

Alastair Greig

Calvin Jones

Graeme Roy

Kim Swales

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