We need to understand how the economy in the UK will grow (if at all) in 2011. Below is a good presentation which highlights the issues;
To summarise the above slideshow, the UK needs to do the following;
1/ Get the conditions right for long term growth - have credible macro policies and an active policy to counter de-industralisation
2/ Have a strong commitment to trade and competition
3/ Incentivise R&D as the social return from research is twice the private return
4/ Consider tax reforms such as one to remove 100% inheritance tax exemptions for family businesses to encourage improved management
5/ Focus human capital investment at lower skilled and younger workers E.g., expanded apprenticeships
6/ Avoid damaging migration caps and removal of teaching subsidies for universities – especially when there is a global war for talent. The universities fear the loss of billions of pounds worth of fees from forreign students
7/ Focus on sector growth in industries where competitive advantage can be successfully nurtured and exploited. Namely...healthcare, niche manufacturing, green energy, universities, bio-pharmaceuticals, creative industries
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