Economic Uncertainty

It is widely believed that uncertainty can have an important influence on economic outcomes. To measure uncertainty at the company level, in partnership with academicsThe Bank of England and Stanford University I have launched a new monthly survey of senior executives in British businesses — the Decision Maker Panel (DMP) .

This work was piloted under the ESRC Impact Accelerator Programme and has subsequently received £1.3m in funding from an ESRC grant and co-funding from the Bank of England, the University of Nottingham and Stanford University. We employ a DMP Unit manager and approximately 35 analysts who recruit participants from a sample of UK companies that matches the Business Register.

DMP participants are asked regular questions about developments in, and the probabilities they ascribe to, a range of possible future outcomes in the following areas: investment and borrowing; employment and costs; and sales and prices.

Our work is described in detail on our webpage.

These regular questions have been supplemented by special questions that have so far focused on the possible impact of Brexit on business conditions. Early results suggest that there is an important relationship between uncertainty about future sales and current investment and employment decisions.

An Article in the Bank of England Quarterly Bulletin can be see here: