The Social Macroeconomics Research Hub of Rebuilding Macroeconomics is seeking to fund pilot research projects concerning the social foundations of economic activities. The Hub thereby aims to focus on an important gap in macroeconomic analysis, namely, the influence of social groups on economic decisions and the influence of these decisions on social groups. Understanding the social underpinnings of economic activities requires an investigation of social motives driving economic decisions, enabling an understanding for the role of social integration and fragmentation in shaping macroeconomic performance. The research will aim to provide guidelines for the conduct of macroeconomic policies.
The research of the hub rests on the following ideas:
(1) Economic cooperation requires social cooperation. The Hub will study the social substrates of economic cooperation, with a view to understanding the social relations underlying economic activities and deriving appropriate policy recommendations.
(2) Social cooperation has traditionally been shaped by social groups of limited size. The bounds of social cooperation can be extended through strategic communication, which can align the identities, interests and motives of large bodies of people.
(3) The scale of current macroeconomic problems requires social cooperation that exceeds the bounds of our current social groups. While we need larger groups, social fragmentation is increasing, generating declining levels of trust and cooperation.
(4) Effective macroeconomic policies need measures that extend the bounds of social cooperation in consonance with the desired bounds of economic cooperation. Hence, the design of macroeconomic policies should be accompanied by policies that build social identities corresponding to our economic objectives.
Hub Co-Leader: Prof Dennis Snower
Dennis Snower is President of the Kiel Institute for the World Economy, and Professor of Economics at Kiel University. He is an expert in the areas of social and behavioural approaches to global problems, and in understanding macroeconomic policy under market imperfections. Some of his recent work with colleagues at the Kiel Institute has examined challenges to global cooperation and global inequality.
Hub Co-Leader: Sir Paul Collier
Sir Paul Collier CBE, FBA is Professor at Oxford, Professorial Fellow of St. Anthony’s College, and a distinguished author having publishing such books as: The Bottom Billion; Wars, Guns and Votes: Democracy in Dangerous Places; and Exodux: How migration is changing our world. Paul is an expert in the development issues facing low-income countries and international relations. He was knighted in 2014 for services to promoting research and policy change in Africa.