| Abstract: | The sluggishness of capital spending over the recovery has reinvigorated the debate over UK investment performance. It has frequently been alleged that the UK financial system holds back investment, while the institutions of continental European countries – particularly Germany – are more supportive of long-term spending by companies. In this article, Harold Rose examines the theoretical and factual basis for this line of argument. He warns policy-makers against acting to promote investment on the basis of arguments which are either not securely founded or which are directly contradicted by the evidence. |
