Category Archives: estimates

Unpicking the City of London’s tax contribution

Prem Sikka

The City of London publishes regular reports showing the sector’s “contribution” to the British economy, in terms of taxes paid and jobs created.  The Finance Curse analysis shows these numbers to be useless — for the simple fact that they show a gross contribution, airbrushing out the costs, instead of what policy-makers need: the net contribution, after the costs of oversized have been taken into account.

The first systematic attempt to put a number to the net figure was by Andrew Baker, Gerald Epstein and Juan Montecino. They came up with a negative number: oversized finance has cost the UK economy a cumulative $4.3 trillion over 20 years.

And there’s another question here: are the gross figures put forward by the City of London even correct?  Continue reading →

The finance curse has taken £4.5 trillion out of the UK economy over 20 years

(Please feel free to cross-post this, as long as you attribute it to here.)

Alongside the launch of The Finance Curse, and my Guardian article, there’s a new study by Andrew Baker of the University of Sheffield, Gerald Epstein of the University of Massachusetts Amherst, and Juan Montecino of Columbia University, estimating that the UK has suffered a cumulative £4.5 trillion hit to its GDP from 1995-2015, due to its financial sector being too large and having turned away from its proper traditional functions towards more harmful and predatory ones.  That is equivalent to 250 percent of GDP – or £170,000 per UK household.

Continue reading →