Our objective is to engage in innovative research that extends the frontiers of the discipline, deepening our understanding of the operation of modern economies. Research spans almost all the major sub-fields of economics with particular strengths in microeconomic theory, including behavioural economics; econometrics, both micro-econometrics and time series; economic history and development and international economics.

The University of Oxford is ranked 8th in the world and 2nd in Europe in the most recent Tilburg University ranking of Economics departments, based on research contribution for the period between 2012-2016.

In the most recent Research Excellence Framework (REF 2014) to evaluate the research output of UK Universities, Oxford was first in overall research strength in Economics and Econometrics, with more research ranked as ‘world-leading’ than any other participating institution. In a submission of 84 FTE academics, 56% of our research was rated as ‘world-leading’ (4*) and a further 33% rated as ‘internationally excellent’ (3*).

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Policy and Impact

As one of Europe’s leading Economics departments, Oxford aims to inform and improve the development and implementation of economic and public policy in the UK and around the world. We do this by producing innovative research that extends the frontiers of the discipline and deepens our understanding of the operation of modern economies.

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Working Papers

Authors: Francesco Zanetti, , Jesus Fernandez-Villaverde, Federico Mandelman, Yang Yu

Sep 2019

We develop a quantitative business cycle model with search complementarities in the inter-firm matching process that entails a multiplicity of equilibria. An active static equilibrium with strong joint venture formation, large output, and low unemployment can coexist with a passive static equilibrium with low joint venture formation, low output, and high unemployment. Changes in fundamentals move the system between the two static equilibria, generating large and persistent business cycle fluctuations. The volatility of shocks is important for the selection and duration of each static equilibrium. Sufficiently adverse shocks in periods of low macroeconomic volatility trigger severe and protracted downturns. The magnitude of government intervention is critical to foster economic recovery in the passive static equilibrium, while it plays a limited role in the active static equilibrium.

JEL Codes: C63, C68, E32, E37, E44, G12

Keywords: Aggregate fluctuations, strategic complementarities, macroeconomic volatility, government spending

Individual View

Authors: Bent Nielsen, , Vanessa Berenguer Rico, Søren Johansen

Sep 2019

The Least Trimmed Squares (LTS) and Least Median of Squares (LMS) estimators are popular robust regression estimators. The idea behind the estimators is to find, for a given h; a sub-sample of h 'good' observations  among n observations and estimate the regression on that sub-sample. We find models, based on the normal or the uniform distribution respectively, in which these estimators are maximum likelihood. We provide an asymptotic theory for the location-scale case in those models. The LTS estimator is found to be h 1/2 consistent and asymptotically standard normal. The LMS estimator is found to be h consistent and asymptotically Laplace.

Keywords: Chebychev estimator, LMS, Uniform distribution, Least squares estimator, LTS, Normal distribution, Regression, Robust statistics

Individual View

Authors: Sara Horrell, Jane Humphries, Jacob Weisdorf

Aug 2019

We use new estimates of men, women, and children’s wages in combination with cost-of-living indices to explore family living standards across six centuries of English history. A family perspective enables us to quantify the labour inputs required from women and children in circumstances when men’s earnings alone were insufficient to secure a decent standard of living, and so to register the historical relevance of the male breadwinner model. We employ a life-cycle approach where pre-marital savings help married couples manage increasing numbers of dependent children as well as other periods of economic pressure. We find that the male breadwinner model was generally insufficient for a ‘respectable’ standard of living; women and sometimes children were required to contribute and, even then, couples still faced poverty during old age. However, with the exception of the pre-Black Death period and the first half of the 17th-century, child labour was not essential and in the early modern era and old-age poverty was in retreat. We reconcile our findings with evidence of a surge in child-labour in the late 1700s and early 1800s, with reference to early modern economic growth, and its association with industriousness and consumerism, twin developments which served to stimulate the Industrial Revolution.

JEL Codes: J22, N13, O10

Keywords: Living Standards; Prices, Wages

Individual View

Authors: Beata Javorcik, , Katherine Stapleton, , Ben Kett, Layla O'Kane

Aug 2019

This paper uses high frequency data on the universe of job adverts posted online in the UK to study the impact of the trade uncertainty caused by the Brexit referendum on labour demand. We develop measures of industry and regional exposure to the threat of poten¬tial most-favoured-nation (MFN) tariffs if the UK were to leave the EU without a trade deal. We show that industries and regions more exposed to the tariff threat differentially reduced online hiring in the period after the referendum. We also show that the magni¬tude of this negative effect varied with the time-varying perceived probability of a no-deal Brexit, proxied by the relative frequency of Google-searches for terms associated with a no-deal Brexit. The policy implications of this paper are that uncertainty around trade policy, not only enacted policy, have real economic impacts and governments should therefore strive for clarity and predictability in their actions to create a strong enabling environment for the private sector.

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Authors: Sudhir Anand, Sanjay G. Reddy

Aug 2019

The disability-adjusted life year (DALY) is a measure of aggregate ill-health whose construction depends on a counterfactual – the number of life-years a person could have expected to live had she or he not died.  There are two ways of specifying the DALY counterfactual to estimate years of life lost (YLL) – by employing an ‘exogenous’ or an ‘endogenous’ life table.  An exogenous life table is independent of the mortality risks experienced by the population whose health (longevity) is being assessed, whereas an endogenous life table is composed of precisely these risks. 
 
Exogenous life tables have been used to construct the DALY in the Global Burden of Disease (GBD) studies – with different exogenous life tables used in the GBD 1990 and GBD 2010 (and later) exercises.  However, an endogenous life table is more appropriate for predicting life-years lost from premature mortality in any given country, and allocating resources through health interventions there on the basis of DALYs averted.
 
Whether an exogenous or an endogenous life table is used, anomalies can arise.  Furthermore, the approach adopted in GBD 2010 onwards adds special difficulties of its own.  GBD 2010 and later GBDs use an exogenous reference life table which is the same for men and women.  This leads to an underestimation of the disease burden of women relative to that of men.

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