From inequality and employment through to pandemics and the energy transition, a multi-disciplinary team of economics researchers at the Institute for New Economic Thinking at the Oxford Martin School have broken new ground over the past decade, changing the way their field can benefit humanity and the planet.

Covid-19

When the Covid-19 pandemic hit, Professor Doyne Farmer and the Complexity Economics team used powerful simulations to rapidly build a model that accurately predicted the impact on the UK economy, showing it is possible to make accurate predictions of an important economic event in real time.  They further used the model to provide advice to the UK government on modifying lockdown policies to enable the economy to begin recovering while minimising health impacts.

Climate Policy

The Climate Policy Explorer, from the Climate Econometrics team, provides a rigorous and comprehensive analysis of which policies actually work in reducing carbon emissions.  Using methods pioneered by Professor Sir David Hendry, the Explorer analyses over 1,500 climate policies from across the world, providing policymakers with valuable insights as to which combinations of policies would likely have the most impact in reducing emissions.

Renewable Energy

For decades, the economic and political narrative has been that a transition to clean energy will mean higher energy prices and reduced growth.  A team led by Professor Doyne Farmer, Dr François Lafond, and Dr Rupert Way found that traditional forecasting methods had significantly underestimated the cost declines in renewable energy.  An improved, empirically-based forecasting method developed by the team showed the world could save $12 trillion by switching to 100% clean energy technologies by 2050.  This work has had a major policy impact, supporting efforts in the UK, US and EU to accelerate the energy transition.

Inequality

Work by Professor Brian Nolan and the Economics, Inequality and Opportunity team has helped change the dominant economic and political narrative on inequality, from an acceptance that it is governed by market forces to an awareness that economic policy choices significantly impact living standards and economic mobility.  The group has worked on innovative policy solutions, including a guaranteed job scheme in Austria that successfully reduced long-term unemployment and has inspired other pilot projects supported by the European Parliament.

Climate Econometrics

The Climate Econometrics team develops both econometric methods to support empirical analysis at the cutting edge of research, and climate applications based on powerful and innovative empirical models and their implications. Statistical and mathematical methods are employed to disentangle complex relationships between human actions, climate responses, and their associated economic effects. They aim to improve our understanding of the impact of humanity on climate and vice versa, and addressing how humanity should respond to the climate crisis. They also bring together climate econometrics researchers through an international research network.

Complexity Economics

The Complexity Economics Programme is applying leading-edge tools from complex systems science to generate new insights into a wide range of economic problems. The group utilises methods such as network analysis and agent-based computer simulations to incorporate realistic portrayals of human behaviour and institutions in its models and better understand how economic systems evolve dynamically over time. This approach enables researchers to see how macro patterns in the economy, such as financial crises, emerge out of micro level behaviours, interactions, and structures. The group is applying these techniques to issues including financial system stability, innovation, and growth, and is also collaborating with the Economics, Inequality & Opportunity programme on inequality and employment, and the Economics of Sustainability programme on issues related to sustainable growth.

Economics, Inequality & Opportunity (EIO)

This research programme, a partnership between INET and the University’s Department of Social Policy and Intervention, seeks to understand the drivers and implications of economic inequality across rich countries and what is required to produce better, fairer growth and opportunity. The programme was initially established with support from the Resolution Foundation from 2014-18, with a particular focus on how working-age households around and below the middle of the distribution were faring and how this could be improved. The Oxford Martin Programme on Inequality and Prosperity supported by Citi from 2016-21 continued to probe the sources and implications of economic inequality, how inequality affects economic growth and living standards as well as intergenerational mobility and opportunity, the political consequences of inequality, and policy responses.

Economics of Sustainability (EoS) 

The Economics of Sustainability Programme seeks to understand the economy and environment as a deeply interlinked complex system and is working to gain insights into how the human economic part of this integrated system might be transformed to become more sustainable.

Macroeconomics & Finance

The Macroeconomics & Finance programme is led by Emeritus Professors David Vines and John Muellbauer.