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Regimes of Austerity: Economic Change & the Politics of Contraction


This research examines the politics of austerity in British and North American cities as they respond to recession, recovery, fiscal uncertainty, growing economic inequality, and changing policy demands. Over the last twenty years we have witnessed growing inequality within our cities (Walks 2014), a growing list of demands that fall onto local governments, and continued fiscal pressures as the central government pursues austerity policies. 

After the 2008 financial crisis, many governments turned to austerity policies to reduce budget deficits by reducing labour costs, privatisation, and reconfiguring public services (Whitfield 2014). In many cases, cities were forced to adopt austerity policies to address high levels of public indebtedness absorbed during the heady days of the subprime lending spree (Donald et al. 2014). Many cities around the world are faced with growing responsibilities and demands but without the long-term budgetary certainties that allow them to plan effectively for the long-term.

Aims & objectives

There has been a plethora of analysis of the impacts of the financial crisis and policy responses at the macro-level, but urban-level analysis has been limited (Martin, 2011; Kitson et al. 2011). This research examines the politics of fiscal contraction in British cities as they respond to the global financial crisis, rising inequality, and a changing fiscal policy landscape. To address this topic we propose the following three research objectives: 

  1. Examine how inequality and the politics around the distribution of public resources have changed at the local level in mid-sized British cities over the last twenty years.
  2. Investigate how a city's economic, demographic and political base can shape the newer politics of austerity.
  3. Consider how economic change, inequality and the politics of redistribution inform traditional theories of urban political and economic geography.


To address these three objectives, we draw on insights from urban political economy. We propose a mixed-methods approach, using quantitative and qualitative research. The quantitative dimension will assess broader trends that may be occurring across British and North American cities, and against which we can benchmark the cities under study. The bulk of the research effort will focus on case studies of selected cities with populations between 350,000 and 500,000.

We will select cities which represent different economic and industrial histories, different institutional contexts, and different current states of economic health and social well-being. Their economies tend to be less complex than their global city counterparts making controlling for variables manageable. These cities, which are at the smaller end of the mid-sized range, are also understudied and yet the implications of our findings will have relevance to many other cities grappling with similar issues.

Broader goals

Our research will advance knowledge in the field of economic change and urban governance. Many theories of urban political economy are built around unchallenged assumptions of growth. In our study, however, while some of our case study cities have continued to experience growth; others are in decline. All of them have had to confront challenging redistribution decisions in particular economic, social and political contexts and have forged new political coalitions around the economics of austerity.


This year we have completed all our field work for the project.  We have conducted field research in Cambridge, Great Yarmouth, Norwich, Blackpool, Northampton, Middlesbrough, York and Wakefield.  We have just finished our last case studies in late July and will now continue transcribing interviews, analysing data, and triangulating different data sources.  We have been exploring the changes of local authority funding of service provision under austerity.  We find some councils shifting towards neo-liberal solutions, but other councils actively experimenting with new forms of institutions and governance structures.  For example, a number of councils have pursued different forms of trusts, mutuals, wholly-owned for-profit entities which will continue to provide public services, or even sell services to other councils, but are removed from the vagrancies of political power. We also find that each local government’s priorities around services - i.e. which services are protected and the extent of that protection - are affected not so much by the ideological stance of the party in power, but the longevity of a party’s power at the local level.  Thus, budgetary spending patterns are connected to power bases which arise from the dominance or decline of local party politics.  We are currently working on a number of journal articles for publication, based on this data.  


An additional objective, given the subject matter, was to extend knowledge beyond the academy.  Gray  experimented with expanding public debate around austerity by collaborating with Prof Susan Smith and Menagerie Theatre Company around a piloting a public-engagement play, The Great Austerity Debate.

One aim of the play is to offer audiences the tools they need to join a debate that is too often dominated by politicians and bureaucrats. The hope is to encourage greater engagement with topics that are hard to articulate in formal or conventional settings, and to create new channels for information exchange in public affairs. After launching at the Cambridge Festival of Ideas, the play’s first tour was to non-theatre venues in Cambridge, Great Yarmouth, County Durham, Walsall, Norwich and London, in October and November 2016.  Performances took place in a church hall, a community centre, a former miners’ reading room, a university lecture theatre and a trade union office: places intimately connected to the everyday life of each locale. After the play was presented, audiences were invited to ‘rewind’, enabling them to guide the characters’ actions and responses, or even to get up on stage in place of (or alongside) the professionals and change the plot.  Collaborating with local people in safe, familiar spaces gave audience the confidence to be bold, even daring, in introducing new options and articulating hidden concerns.  Every single performance generated a high level of public debate and a host of new ideas.  We hope to tour the country with The Great Austerity Debate next year. 

Watch The Great Austerity Debate on YouTube


Konzelmann, S. Gray, M. and Donald, B. (2016) ‘Assessing austerity.’ Cambridge Journal of Economics, Cambridge Journal of Regions, Economy and Society and Contributions to Political Economy. Virtual Special Issue.  

Donald, B. and M. Gray. 2015. "Urban Policy and Governance: Austerity Urbanism" in Urbanization in a Global Context: A Readers Guide, edited by L. Peake and A. Bain. Oxford: Oxford University Press, forthcoming. 

Donald, B. and Hall, H. 2015. "The Innovation challenges of a public sector city", In M. Gertler and D. Wolfe. Social Dynamics of Economic Performance: innovation and creativity in city-regions. University of Toronto Press, forthcoming.

Barford, A. and Pickett, K. 2015. How to Build a More Equal American Society: Lessons from Successful Experiences. Solutions, 4(5), 60-71 

Donald, B., Glasmeier, A., Gray, M., and Lobao, L. 2014. Austerity in the city: economic crisis and urban service decline?. Cambridge Journal of Regions, Economy and Society 7 (1): 3-15.

Gray. M. 2014. "Altering the landscape: Reassessing labour's role in Las Vegas' Hospitality Industry" in (A. Underthun and D. Jordhaus-Lier, eds) A Hospitable World: Tourism and the Organisation of Work in Hotel Workplaces. 

Gray, M. 2014. "Educating Reeta: Reflections on Producing Narratives of Work" in (eds: Castree, N., Kitchin, R., Lawson, V., Lee, R., Paasi, A., Radcliffe, S., Withers, C.) Sage Handbook of Human Geography. London: Sage. 

Gray, M. and Defilippis, J. 2014. "Learning from Las Vegas: Unions and post-industrial urbanisation" Urban Studies.

Donald, B. and Gray, M. 2013. "The Rise of the Austerity Regime." Working Paper No. 20-5-13, Departments of Geography, Queen's University, 2013.

Barford, A. and Dorling, D. 2011. Inequality. In Southerton, D. et al. (Eds.) Encyclopaedia of Consumer Culture. SAGE Publications, London 

Gray, M., Kurihara, T., Hommen, L. and Feldman, J. 2007. "Networks of Exclusion: Job Segmentation and Gendered Social Networks in the Knowledge Economy" Equality, Diversity and Inclusion: An International Journal?, 26 (2): 144-161. doi:10.1108/02610150710732212

Conference/Workshop papers

Gray, M.  was keynote speaker at the University of Guadalajara, Mexico and the University of Sydey (Regional Studies Association), speaking about the austerity findings in relationship to populism and Brexit. 

Media coverage

Gray, M. 'The Great Austerity Debate', University of Cambridge (YouTube).

Gray, M. 'Unite the Union', blog on the play, Stronger Unions.

Principal investigators

Mia Gray
Betsy Donald

Research fellows

Anna Barford

Project dates



Cambridge Political Economy Society Trust and British Academy