British Failure? Britain’s Relative Economic Decline in an International Context 1935-1970

Relative economic decline has since long been a research topic in the literature on long-term British economic development. In particular the literature on the post-second world war era suggests that the process of relative economic decline was the result of failure of British industrial policies, and not an inevitable consequence of global capitalism and economic growth in other nations. This study reinvestigates Britain’s productivity performance in manufacturing in an international context between 1935 and 1970. Structural, technical, and institutional factors are studied from the perspective of the industry-of-origin approach, by making use of detailed industry-level data from official sources. This study reveals that the British performance in the manufacturing sector in the 1950s cannot be characterised by concepts like failure. Britain’s commitment to trade with the Sterling Area, however, did contribute to the relatively poor performance in labour productivity during the 1960s.