BRITAIN should be more like Danish TV drama Borgen and less like The Thick Of It when it comes to politics and the economy, a new report has suggested.

People who live in countries such as Denmark have more engagement and involvement with their economies than those in the UK and the US, according to research by academics working in collaboration with Oxfam.

And countries with strong “economic democracy” engagement have lower levels of inequality and higher levels of productivity.

“How much control do people really have over their everyday lives?” asks Andy Cumbers, professor in regional political economy at Glasgow University.

The answer, it seems, in this country at least, is not very much, he says.

Cumbers and others were supposed to be at the Scottish Parliament on Wednesday night to share details of an 18-month research project, but heightened security in the wake of the Manchester attack saw all events at Holyrood, bar the most important, postponed or cancelled.

It will be September before he has a chance to share his index of political economy with elected representatives.

Cumbers, who describes himself as a socialist, political economist, geographer, and naturalised Scottish internationalist, was, along with researchers at Nottingham Trent University, awarded a £249,408 grant by the Economic and Social Research Council to look into economic democracy and public policy.

From that came the international economic democracy index (EDI), a tool measuring how engaged people are with the economy, how engaged they are allowed to be, and what that might mean for governments.

Previous efforts had focused on trade union rights and levels of co- operative businesses, but the researchers involved in the EDI project extended that to look at individual economic rights, levels of public participation and the nature of economic decision-making in each of the countries they were look at.

“How much, for example, is tax revenue dominated by central government compared to regional and local government?” Cumbers says.

“We’ve also got measures to look at the domination of the financial sector in the economies of different countries.

“The other thing we look at is transparency and participation in macro-economic decision making by different groups.”

Macro-economics, the big decisions, the performance of the economy as a whole. How much do people in the UK, and Scotland, feel as if they have any say on the big changes in the economy, such as unemployment, growth rate, gross domestic product and inflation.

Again, according to the index, not very much. The UK lang- uishes near the bottom, way below the EU average, and only marginally better than the United States, Slovakia and Hungary.

There is a sense, says Cumbers, that the economy works for the few and not the many. “The UK has a very, very low level of economic demo- cracy,” Professor Cumbers said. “And that’s everything from workplace individual employments rights, right through to the levels of collective bargaining which are low in the UK compared to other countries.

“In things like that, the financial sector has a big role compared to other countries.

“If you look at how the Bank of England works, although we’ve got what is often called Bank of England independence, that means it’s largely independent from democratic government scrutiny.

“Also, the levels of transparency about how the economy works are quite low compared with some of the other countries.”

Top of the index is Denmark. In fact, all the best performing countries, those that display high levels of economic democracy, come from Nordic or continental Western Europe, with Denmark and Sweden way ahead of the rest.

Notably, the top seven countries all have relatively small population sizes, all under 10 million.

Workplace democracy is strongest here, the researchers say, with high levels of employment protection, low levels of long-term unemployment, and strong and well-defined rights regarding working time, leave entitlement and gender parity.

The paper showed the countries who scored well on economic democracy had low levels of inequality, and high levels of labour productivity.

Attacking trade unions, cutting back flexible working and benefits and wages, and the rise of the gig economy, will, the researchers says, push people away from economic democracy and drive up poverty.

The research continues.

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Why the Nordic nations are coming out on top - by Andrew Cumbers, Professor of Regional Political Economy at the University of Glasgow

 

The National:

 

THERE is much public angst and debate about the growth of right-wing populism, increasing xenophobia and a rejection of political elites, whether signalled by Brexit, the election of President Trump or the rise of Marine Le Pen.

Significant numbers of those voting for far-right parties or policies across Europe and North America are in old industrial regions and former working-class strongholds.

Here, de-industrialisation, the decline of decent jobs and their replacement by a world of casual work and zero hours contracts are providing a fertile breeding ground for political “outsiders” who fashion simplistic, yet flawed, dangerous and divisive, economic narratives.

While there is much discussion about a crisis of liberal democracy, a largely unconsidered element is the state of economic democracy. Yet, a large part of the anger felt by those marginalised by three decades of globalisation is down to a loss of economic power and control.

Against this backdrop, with colleagues at the Universities of Glasgow and Nottingham Trent, Oxfam and the New Economics Foundation – and with support from the Economic and Social Research Council – we have a constructed a new international index of economic democracy across 32 OECD countries (exempting Turkey and Mexico for which there is insufficient data).

Our thinking behind the index is that we should be asking more searching questions about the nature of the economy itself.

How democratic is it? How well distributed is economic decision-making power, and how much control and economic security do people have over their lives?

The index is novel in developing a broader definition of economic democracy – beyond the usual focus on trade union rights – to incorporate individual economic rights, levels of public participation, and the nature and structure of decision-making across an economy.

For example, what rights do individuals have at work and in the labour market? How important is the financial sector to the rest of the economy? How centralised is government taxation and spending? How transparent and representative is macro-economic policy?

We recognise the difficulties of measuring some of these issues. In this sense, the index is as much about provoking a debate, accepting that all indexes are imperfect, rather than reaching 100 per cent definitive conclusions. However, we are confident that our index is as robust as possible.

The most striking finding is the basic difference between a more “social” model of northern European capitalism and the more market-driven Anglo-American model.

Hence the Scandinavian countries score among the best, with their higher levels of social protection, employment rights and democratic participation in economic decision-making. The reverse is true of the more deregulated economies of the English-speaking world. The US ranks particularly low, with only Slovakia below it. The UK is 25th of 32.

Another aspect of our work is to explore the relationship between economic democracy and important public policy goals. While our work in this area is still continuing, we have found very strong and highly significant negative relationships between economic democracy and inequality. In other words, countries with more economic democracy tend to have lower levels of inequality.

Our emerging results also suggest that economic democracy is positively associated with productivity.

Countries where workers and citizens have more rights and greater say in the economy are more productive than those where they are marginalised from decision-making.

From a Scottish perspective, the research highlights the potential for a more Nordic model of economic governance in the event either of independence or an advanced form of home rule, with strong devolved powers over economy, finance and employment regulation.

Conversely, it suggests the problems of more UK-style labour market deregulation and flexibility, and business friendly-free trade deals, further the imbalance between multinational corporations and workers. In other words, a likely trajectory for the UK following a hard Brexit.

More details of our project can be found here: https://democratisingtheeconomy.com/