8th Oct 2025 12:30pm
- 2:12pm
Greenwich Campus
KW216
Austerity, as it existed in the United Kingdom between 2010 and 2019, saw the best part of a decade of government policy devoted to fiscal consolidation. The governments of the day relied on the macroeconomic theory of 'expansionary fiscal contractions' to justify their programme of spending cuts, in which there are thought to be two mechanisms at play: an aggregate demand mechanism and a labour supply mechanism. In the first, fiscal consolidation stimulates the economy by improving private sector confidence and encouraging lower interest rates. In the second, cuts to in-work benefits, public sector employment, and public sector pay reduce the bargaining power of workers, reducing unit labour costs and thereby increasing employment. In this paper, we attempt to disentangle these demand and supply-side effects using the United Kingdom as a case study, using continuous treatment difference-in-differences models with district-level welfare cuts as the treatment variable. We find that austerity reduced labour costs and increased employment rates, suggesting that the supply-side effects of austerity dominated any demand-side effects between 2010 and 2019. Presenters: Location: Teams (Online) details: Meeting ID: 319 421 430 872 5 From taster days to subject open evenings, find out more about what you'll study, where you'll study it and perhaps even meet who'll you'll be studying with. If you'd like to see what your child's experience at Greenwich will be like, join them at one of our Open Days. Visitors can talk to staff and students and attend talks on student finance and how to apply. Learn something new or join the discussion at one of our many public lectures, seminars and events, covering everything from education to foreign policy and current affairs.
Rob Calvert Jump and Thomas Rabensteiner
University of Greenwich, KW216
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