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How City of London finance is making us poorer

When a financial sector grows beyond a useful size, it begins to harm the economy that hosts it

A new report published today by the Sheffield Political Economy Research Institute at the University of Sheffield reveals the UK’s oversized financial sector has cost the economy £4.5 trillion in lost economic output between 1995 and 2015 – equivalent to £67,500 for every person in the UK.

The report finds that the UK economy would likely have performed much better in overall growth terms if its finance sector was smaller, and if finance was more focused on supporting other productive areas of the economy.

Also published today is a new book by Nicholas Shaxson, entitled The Finance Curse: How Global Finance is Making Us All Poorer. The book sets out a new economic framework referred to as the “finance curse” for understanding how a financial centre that has grown above its useful size and role becomes predatory and harmful to the economy that hosts it. He argues the City of London is draining resources and talent from other economic sectors, creating large economic inequalities and spurring financial crises.

Scroll down to view infographics and videos about the finance curse and how it impacts on us all. You can read Nicholas Shaxson’s Guardian long read here, his blog here and our full press release here.

How the City of London makes us all poorer - Tax Justice Network 2018 - long infographic

 

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