ESCoE Project 2.11 Using Firm-Level Surveys to Understand Changes in Output and Prices.
This project uses data from firm-level surveys (provided by the Confederation of British Industry (CBI)) regarding the proportions of firms changing output or prices each period to construct direct measures of changes in “desired” output, prices and marginal costs. Using these new measures, new output indices and decompositions of published Producer Price Inflation (PPI) indices (into sticky and flexible prices) are developed. These survey-based measures are used to improve estimates of New Keynesian Phillips Curves (central to monetary policymaking and vital to the central banks), from which nowcasts will be provided. These nowcasts are based on information that arrives several weeks before official data on PPI, and they are likely to be more accurate since they benefit from direct measures of marginal costs (in contrast to existing estimates which rely on proxy measures).
ESCoE Project 2.9 Using Firm-Level Surveys to Understand Industrial and Regional Capacity, Investment, Productivity and Output Growth.
The UK productivity slowdown since 2007 is a key policy concern although there remains some ambiguity over its severity/longevity and the propagation mechanisms by which demand and supply shocks impact on capital, productivity and trend output growth. Questions still to be addressed include:
To what extent can we understand business cycle fluctuations, temporary versus permanent effects of shocks, and trend reductions in productivity through better measurement of investment, inventories, capacity and output?
Can information on capacity utilisation and inventories improve nowcasts and real-time forecasts of economic activity, including investment and output outcomes?
How is real-time firm-level information on investment decisions, inventories, capital utilisation and output plans best employed to understand local (regional or industrial) and national prospects?
To what extent does survey information collected by the Office for National Statistics (ONS) and other bodies such as the Confederation of British Industry (CBI) provide insights into industrial and regional macrodynamics?
This project aims to address these issues by exploiting the information contained in the firm-level responses to the suite of surveys conducted monthly by the CBI over the last twenty years. It will use these survey responses to improve our measurement and understanding of economic data at higher levels of aggregation.
Lee, K., Mahony, M. and Mizen, P. (forthcoming), “Measuring flexible prices, flexible output, and marginal costs using survey data”, ESCoE Discussion Paper 2022-03, Economic Statistics Centre of Excellence (ESCoE).
Lee, K., Mahony, M. and Mizen, P. (2022), “Investment and capacity utilisation in a putty-clay framework", ESCoE Discussion Paper 2022-03, Economic Statistics Centre of Excellence (ESCoE).
Mahony, M. and Martin, J. (2022), “Matching UK business microdata: A study using ONS and CBI business surveys", ESCoE Technical Report 14, Economic Statistics Centre of Excellence (ESCoE).
Lee, K., Mahony, M. and Mizen, P. (2020), “Output expectations, uncertainty and the UK business cycle; Evidence from the CBI's suite of business surveys", CFCM Working Paper 20/12, Centre for Finance, Credit and Macroeconomics (CFCM) University of Nottingham.
Lee, K., Mahony, M. and Mizen, P. (2020), Nowcasting output movements and recessionary events using the CBI's suite of business surveys; A technical note, Working Paper, University of Nottingham.
Lee, K., Mahony, M. and Mizen, P. (2020), “The CBI suite of business surveys", ESCoE Technical Report 08, Economic Statistics Centre of Excellence (ESCoE).
Bertsch, V., Hyland, M. and Mahony, M. (2017), “What drives people's opinions of electricity infrastructure? Empirical evidence from Ireland”, Energy Policy, 106(C), 472-497.