Michael Spence

One way to measure the size of a company, industry, or economy is to determine its output. But a better way is to determine its added value - namely, the difference between the value of its outputs, that is, the goods and services it produces, and the costs of its inputs, such as the raw materials and energy it consumes.

It is a wonderful and unexpected honor to receive the Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel. Receiving this prize with Joseph Stiglitz and George Akerlof, whose work I have learned from and admired, makes it even more gratifying.

Digitally enabled supply chains initially increased efficiency and dramatically shortened lead times. Capital was mobile; labor, less so. Economic activity (production, research, design, etc.) moved to any accessible country or region that had relatively inexpensive labor and human capital.

When ministers in this government talk about investing in education and skills, about making the planning system work; about employment law reform and delivering transport and power generation and broadband communication infrastructure, we are talking about raising Britain's productivity.

The standardization of world culture, with local popular or traditional forms driven out or dumbed down to make way for American television, American music, food, clothes and films, has been seen by many as the very heart of globalization.