Productivity Puzzles

Is all foreign direct investment good for productivity? Can the UK still compete for the world's most valuable investment projects? And what makes FDI transformative rather than merely incremental? 

This episode explores the shift from the quantity of inward investment to its quality, what researchers now call transformative FDI, and uses the West Midlands as a case study in how investment promotion, local capabilities, and long-term economic strategy can work together to drive productivity growth.

Host Professor Bart van Ark is joined by:

• Professor Jun Du, Managing Director, The Productivity Institute; Professor of Economics, Alliance Manchester Business School.

• Nigel Driffield, Professor of International Business, Warwick Business School; Deputy Pro-Vice-Chancellor for Regional Engagement, University of Warwick.

• Neil Remi, Chief Executive, West Midlands Growth Company.

For more information on the topics discussed:

• Transformative FDI & Regional Productivity Research: Publications and studies by Professor Nigel Driffield and Professor Jun Du at The Productivity Institute.

• Certainty without conviction: Why the EU-UK Trade and Cooperation Agreement failed to reverse Brexit’s investment exodus by Jun Du, Nigel Driffield, Oleksandr Shepotylo & Xiaocan Yuan. https://www.aston.ac.uk/certainty-without-conviction

• Sub-National Economic Strategy: Lord Heseltine’s report, No Stone Unturned: In Pursuit of Growth (2012).

• Global Investment Trends: UNCTAD World Investment Report & Statistics.

• UK Industrial Support Programs: Information on national manufacturing initiatives including Made Smarter and the Drive35 programme. 

• The Manchester Model: what foreign inward investment reveals about the UK’s most productive city outside London by Jun Du, Xiaocan Yuan, Diane Coyle

About Productivity Puzzles:

Productivity Puzzles is brought to you by The Productivity Institute, a research body involving nine academic institutions across the UK, nine Productivity Forums throughout the nation, and a national independent Productivity Commission to advise policy makers at all levels of government. It is funded by the Economic and Social Research Council.

Is the UK’s recent productivity recovery a sign of lasting improvement? How could AI, technology adoption and shifting global economic conditions shape the country’s future productivity?

This episode of Productivity Puzzles explores the challenges facing the UK economy, from weak technology diffusion and widening gaps between firms to trade, competitiveness and the priorities needed to support long-term productivity growth.

Host Professor Bart van Ark is joined by:

• Professor Jun Du, TPI Managing Director and Professor of Economics at Alliance Manchester Business School

For more information on the topic:

• Bart's farewell blog: https://www.productivity.ac.uk/news/productivity-place-and-the-power-of-alignment-reflections-on-six-years-at-tpi/
• Jun's introductory blog: Productivity when nothing stands still - The Productivity Institute
• Jun Du, Look inside, look around, look beyond: Look inside, look around, look beyond: From productivity gaps to adaptive capacity - The Productivity Institute
• Jun Du, The options are familiar. The world around them is not: The options are familiar. The world around them is not. - The Productivity Institute
• Bart & Dirk's pro-productivity policy book/project:  Pro-Productivity Policies - The Productivity Institute
• Bart's recent frontier/diffusion paper: Rewiring Europe’s Productivity Framework: Aligning Investment, Innovation, and Diffusion - The Productivity Institute
• The Manchesterism publication: The Manchester Model: what foreign inward investment reveals about the UK’s most productive city outside London - The Productivity Institute
• Link to the ONS paper: Measuring labour productivity: our new approach | National Statistical

About Productivity Puzzles:

Productivity Puzzles is brought to you by The Productivity Institute, a research body involving nine academic institutions across the UK, nine Productivity Forums throughout the nation, and a national independent Productivity Commission to advise policy makers at all levels of government. It is funded by the Economic and Social Research Council.

Generative AI has moved from curiosity to everyday tool with remarkable speed. But the big productivity question is not simply whether people are using it; it is whether firms, sectors and economies can turn that use into lasting productivity gains.

This episode of Productivity Puzzles explores the challenges and opportunities that Generative AI presents, centring on a new article just published in the International Productivity Monitor, the joint journal of the Centre for the Study of Living Standards and The Productivity Institute.

Host Professor Bart van Ark is joined by:

• Martin Baily, Senior Fellow Emeritus at the Brookings Institution
• Diane Coyle, Bennett Professor of Public Policy and Research Director, Bennett School of Public Policy, University of Cambridge

For more information on the topic:

• Martin Neil Baily, David M. Byrne, Aidan T. Kane and Paul E. Soto, The Potential for Sustained Productivity Impetus from GenAI, International Productivity Monitor, Issue 50, pp 5-26.
• Martin Neil Baily, 2023. "Lessons from a Career in Productivity Research: Some Answers, A Glimpse of the Future, and Much Left to Learn," International Productivity Monitor, Issue 44, pages 120-149, Fall.
• Productivity Puzzles Podcast: Ask the expert on… what is productivity?
• Tera Allas, AI and productivity: the ladder of leakage, Substack.
• Carol Corrado, Jonathan Haskel, Cecilia Jona-Lasinio, Artificial intelligence and productivity: an intangible assets approach, Oxford Review of Economic Policy, Volume 37, Issue 3, Autumn 2021, Pages 435–458
• Zvi Griliches, Hybrid Corn: An Exploration in the Economics of Technological Change. Econometrica, October 1957, 25(4), pp. 501-22.

About Productivity Puzzles:

Productivity Puzzles is brought to you by The Productivity Institute, a research body involving nine academic institutions across the UK, nine Productivity Forums throughout the nation, and a national independent Productivity Commission to advise policy makers at all levels of government. It is funded by the Economic and Social Research Council.

Why do firms invest when they do and not necessarily when they should? Are firms too cautious to invest? Or just realistic about uncertainty? Is the real investment gap about money or about mindset?

This episode of Productivity Puzzles explores why the UK has invested less than its peers, drawing on two brand-new studies from The Productivity Institute: one looking at how firms invest, the other at how managers think.

Host Professor Bart van Ark is joined by:

• Tera Allas, Honorary Professor at Alliance Manchester Business School, Chair Advisory Board, at The Productivity Institute.
• Stephen Roper, Professor of Enterprise at Warwick Business School, founding Director of the Enterprise Research Centre, Co-Director of the Innovation Research Caucus, and Research Programme Lead on “Firms in Transitions” at The Productivity Institute.
• Catherine Mann, Honorary Professor at Alliance Manchester Business School, External Member of the Monetary Policy Committee at the Bank of England, Programme Lead on “Finance and Investment” at The Productivity Institute.

For more information on the topic:

E. Golubova, S. Roper (2026) Understanding productive investment decisions: Investment patterns and decision-making processes, The Productivity Institute and Enterprise Research Centre.

T. Allas, S. Roper (2026) Ambitious but risk averse: UK manager attitudes and the investment gap, The Productivity Institute.

C. Mann (2026) Finance, Investment, and Productivity: Distillation and Synthesis of TPI Research Programme on Finance. Productivity Insights Paper No. 085, The Productivity Institute.

T. Allas, D. Zenghelis (2025) The UK’s capital gap: a short-fall in the trillions of pounds that will take decades to bridge. Productivity Insights Paper No. 055, The Productivity Institute.

C. Mann (2024) UK Business Investment: Economists, Managers, Financiers. An Integrated Framework to Analyse the Past and Underpin Prospects. Productivity Insights Paper No. 036, The Productivity Institute.

Productivity Puzzles podcast, Business Dynamism: is turbulence good for productivity?, The Productivity Institute.

Y. Xue, C. Mann (2026) Cost of Capital and Investment: Evidence from the UK. Working Paper No. 072, The Productivity Institute

S. Roper, R. Owen (2026) The early-stage, equity-finance journey of potential high-growth companies in the UK, Department for Business and Trade.

About Productivity Puzzles:

Productivity Puzzles is brought to you by The Productivity Institute, a research body involving nine academic institutions across the UK, nine Productivity Forums throughout the nation, and a national independent Productivity Commission to advise policy makers at all levels of government. It is funded by the Economic and Social Research Council.

If one in five working‑age people are inactive, what does that say about the UK’s productivity problem? Why does ill health push so many people out of work in the UK, but not in peer countries?

Rising economic inactivity linked to health has become a major challenge for the UK economy. In this discussion, Charlie Mayfield draws on insights from the Keep Britain Working review to explore the role employers can play in supporting people to remain in work. The conversation examines how workplace practices, health support and collaboration between employers, government and communities can help strengthen workforce participation and productivity.

Host Professor Bart van Ark is joined by:

• Charlie Mayfield, Chair, Keep Britain Working Review, and Former Chair, John Lewis Partnership

For more information on the topic:

• Keep Britain Working: final report, independent report for the UK Government. 
• George Williams, How to keep Britain working: Making the Vanguard Phase a success, Lancaster University, (05/03/2026).
• Sam Atwell, How to Keep Britain Working, Health Foundation (28/10/2025).
• CIPD, Keep Britain Working review makes employee wellbeing impossible for business to ignore, says CIPD (11/11/2025).
• Productivity Puzzles podcast, Business model innovation and strategic productivity.
• The Productivity Institute, Working ‘on’ the business not just in it (21/06/2021).

About Productivity Puzzles:

Productivity Puzzles is brought to you by The Productivity Institute, a research body involving nine academic institutions across the UK, nine Productivity Forums throughout the nation, and a national independent Productivity Commission to advise policy makers at all levels of government. It is funded by the Economic and Social Research Council.

If universities are engines of growth, why isn’t productivity accelerating? What’s the point of educating graduates if regions can’t keep or use them?

Skills are central to regional economic performance, but translating the supply of graduates into broader workforce productivity remains a challenge. In this session, Duncan Ivison discusses the relationship between higher education, further education and place-based development. Using Greater Manchester as an illustration and drawing on international examples, the conversation explores how policy can strengthen skills systems, support graduate retention and migration, and better connect education with regional economic growth.

Host Professor Bart van Ark is joined by:

• Duncan Ivison, President and Vice-Chancellor, The University of Manchester

For more information on the topic:

• Duncan Ivison: higher education is a system, not a market, Times Higher Educational Supplement (17/10/2024).
• Aadya Bahl and Henry G. Overman (2026) Hive of talent: what would it take to raise skills and productivity in Greater Manchester? Centre for Economic Performance.
• Recording of Skills, Talent and Productivity in Greater Manchester event, The Productivity Institute YouTube channel (29/04/26).
• Redouane Sarrakh, Jason Heyes (2026) Training Practices and Skills Needs in Yorkshire, the Humber and the North East, Yorkshire, Humber and North East Productivity Forum Paper 2026, The Productivity Institute.
• Damian Grimshaw, Mary O’Mahony, Anthony Rafferty (2026) Skills, Organisations and Worker Engagement: Summary of People Research Programme, Productivity Insights Paper No. 083, The Productivity Institute.
• Athene Donald, Joe Peck and Andy Westwood (2025), Prioritising Skills for Regional and National Growth, in Bart van Ark et al, eds., Joining Up Pro-Productivity Policies in the UK, The Productivity Institute and National Institute of Economic and Social Research, pp. 91-101.
• Lessons for UK universities from the Australian experience by Duncan Ivison, Financial Times (23/09/24).
• Free speech, the Fallowfield Redevelopment, and catching the 142: An interview with Duncan Ivison, by Ella Logan-Wilson and Miles Davenport, the Mancunion (09/10/24).
• University of Manchester launches Unit M to supercharge inclusive growth, The University of Manchester (08/10/24).
• Unit M launches first deep tech accelerator cohort to fast-track innovation across Greater Manchester (2026) The University of Manchester.

About Productivity Puzzles:

Productivity Puzzles is brought to you by The Productivity Institute, a research body involving nine academic institutions across the UK, nine Productivity Forums throughout the nation, and a national independent Productivity Commission to advise policy makers at all levels of government. It is funded by the Economic and Social Research Council.

Do we need to rethink how we measure productivity in the age of digital technologies and AI?

Productivity is a fundamental measure of how effectively people, firms and places transform resources into improved living standards. Diane Coyle talks about why understanding productivity depends on improved economic measurement, including more accurate valuation of intangible, natural and digital capital. She also explains why the effects of technologies such as digitalisation and AI remain difficult to capture in traditional statistics, with significant implications for policy and how we judge economic progress.

Host Professor Bart van Ark is joined by:

• Diane Coyle, Bennett Professor of Public Policy, University of Cambridge

For more information on the topic:

• Diane Coyle (2025) The Measure of Progress: Counting What Really Matters, Princeton University Press.
• Diane Coyle (2025), Old Wine in New Digital Bottles: The Challenges of Measuring the Digital Economy. Review of Income and Wealth, 71.
• Stephen Roper and Chander Velu (2026) Adoption, implementation, alignment – maximising the performance benefits of digital investment, Productivity Insights Paper No. 084, The Productivity Institute.
• Productivity Puzzles podcast, Will hybrid and flexible work help or hurt productivity and wellbeing?
• Productivity Puzzles podcast, Industrial policy, institutions and fiscal mechanisms.
• Productivity Puzzles podcast, Productivity and well-being.
• Productivity Puzzles podcast, Science and Innovation Policy for Hard Times.
• Productivity Puzzles podcast, Books Festival: Diane Coyle & Jan Mischke.

About Productivity Puzzles:

Productivity Puzzles is brought to you by The Productivity Institute, a research body involving nine academic institutions across the UK, nine Productivity Forums throughout the nation, and a national independent Productivity Commission to advise policy makers at all levels of government. It is funded by the Economic and Social Research Council.

Why doesn’t digital technology always translate into productivity growth? What if the technology and your business model don’t quite fit?

Despite unprecedented advances in digital technologies, productivity growth has stalled, revealing a striking paradox: innovation is abundant, but its benefits are not. We discuss with Chander Velu why the issue lies not in the technologies themselves but in the failure to redesign how organisations create and capture value when adopting automation, digital fabrication, or quantum technologies.

Host Professor Bart van Ark is joined by:

• Chander Velu, Professor in Innovation and Economics, University of Cambridge

For more information on the topic:

• Stephen Roper, Chander Velu (2026) Adoption, implementation, alignment – maximising the performance benefits of digital investment, Productivity Insights Paper No. 084, The Productivity Institute.
• Silvia Massini, Mabel Sanchez-Barrioluengo, Xiaoxiao Yu, Myungun Kim, Philip Chen, Chander Velu (2025) Adoption of Advanced Digital Technologies and Platforms: Insights from a UK national survey, Working Paper No. 049, The Productivity Institute.
• Chander Velu (2026) The business of quantum technologies and the future of productivity.
• Productivity Puzzles podcast, Business model innovation and strategic productivity.
• Productivity Puzzles podcast, The Productivity Puzzle: Lessons Learned and What’s Next?.

About Productivity Puzzles:

Productivity Puzzles is brought to you by The Productivity Institute, a research body involving nine academic institutions across the UK, nine Productivity Forums throughout the nation, and a national independent Productivity Commission to advise policy makers at all levels of government. It is funded by the Economic and Social Research Council.

Why do places matter for productivity? If productivity is local, why is policy still so centralised in the UK?

Productivity varies widely across regions, shaping economic opportunity and growth. Drawing on international evidence and Philip McCann’s extensive research on regional development, the discussion considers how cities and regions can strengthen their economic performance and contribute to national productivity growth. 

Host Professor Bart van Ark is joined by:

• Philip McCann, Sir Terry Leahy Chair in Urban and Regional Economics, Alliance Manchester Business School, The University of Manchester

For more information on the topic:

• Philip McCann (2026) Regional Access to Capital and Investment Finance: Summary of results from TPI Research Programme. Productivity Insights Paper No. 086, The Productivity Institute.
• Raquel Ortega-Argilés, Philip McCann (2026) Knowledge Diffusion and Regional Productivity Growth: Summary of TPI Research Programme 2023-2026. Productivity Insights Paper No. 087, The Productivity Institute.
• Raquel Ortega-Argilés, Pei-Yu Yuan (2024) Do UK Research and Collaborations in R&I Promote Economic Prosperity and Levelling-up? An analysis of UKRI funding between 2004-2021, Working Paper No. 046, The Productivity Institute.
• Productivity Puzzles podcast, Turnaround Cities: Lessons learned for the UK.
• Productivity Puzzles podcast, Industrial policy, institutions and fiscal mechanisms.
• Productivity Puzzles podcast, Levelling up and the Northern Powerhouse.
• Unlocking Wales' Productivity Potential podcast, Understanding Productivity in Wales.

About Productivity Puzzles:

Productivity Puzzles is brought to you by The Productivity Institute, a research body involving nine academic institutions across the UK, nine Productivity Forums throughout the nation, and a national independent Productivity Commission to advise policy makers at all levels of government. It is funded by the Economic and Social Research Council.

Why does productivity vary so widely between NHS organisations? Can new technologies like AI and remote monitoring help the health service seize the opportunity to redesign care for the long term? 

This episode of Productivity Puzzles explores the critical challenges and opportunities facing the UK’s health service, with a discussion centring on the NHS Productivity Commission’s major new report, From Diagnosis to Delivery: A Framework for Accelerating NHS Productivity Growth.

Host Professor Bart van Ark is joined by:

• Anita Charlesworth, Senior Economic Adviser at the Health Foundation and co-chair of the NHS Productivity Commission.
• Tera Allas, Honorary Professor at Alliance Manchester Business School and co-chair of the NHS Productivity Commission.
• Mark Britnell, Professor at the Global Business School for Health at University College London and Chair of Health Innovation Manchester.

For more information on the topic:

• Tera Allas, Anita Charlesworth, Hannah Chhoa-Howard, Katie Fozzard, Alison Moulds and Stephen Rocks (2025) From Diagnosis to Delivery: A Framework for Accelerating NHS Productivity Growth, The Health Foundation.
• Mark Britnell (2019) Human: Solving the global workforce crisis in healthcare, Oxford Academic.
• Joel Hoskins and Bart van Ark (2025) Productivity and Responsible AI in Adult Social Care, The Productivity Institute.
• World Economic Forum (2016) Misaligned Stakeholders and Health System Underperformance, World Economic Forum White Paper.

About Productivity Puzzles:

Productivity Puzzles is brought to you by The Productivity Institute, a research body involving nine academic institutions across the UK, nine Productivity Forums throughout the nation, and a national independent Productivity Commission to advise policy makers at all levels of government. It is funded by the Economic and Social Research Council.