In closing those gaps, a useful intermediate objective would be to create in the UK a leading-edge diffusion infrastructure, to rival and complement its leading-edge innovation infrastructure. This boost our world (and, with luck, our World Cup) rankings. Inclusive innovation could serve as a conduit to inclusive growth. The UK’s innovation hub would get the spokes it needs to reach every sector, every region, every worker. It would be an industrial strategy for everyone. 58  Haldane (2017). 23  All speeches are available online at www.bankofengland.co.uk/speeches  23  References Acemoglu, D (2002), ‘Directed Technical Change’, The Review of Economic Studies, Vol. 69, No. 4, pp. 781-809. Acemoglu, D, Gancia, G and Zilibotti, F (2015), ‘Offshoring and Directed Technical Change’, American Economic Journal: Macroeconomics, Vol. 7, No. 3, pp. 84-122. Acemoglu, D and Robinson, J (2012), Why Nations Fail: The Origins of Power, Prosperity and Poverty, Penguin Random House. Aghion, P, T, Besley, J, Browne, D, Caselli, R, Lambert, R, Lomax, C, Pissarides, N, Stern, J, van Reenen (2017), ‘Investing for Prosperity: skills, infrastructure and innovation’, LSE Growth Commission Report. Andrews, D, Criscuolo, C and Gal, P (2015), ‘Frontier firms, technology diffusion and public policy: micro evidence from OECD’, OECD Productivity Working Paper Series, No 2. Andrews, D, Criscuolo, C and Gal, P (2016), ‘The Global Productivity Slowdown, Technology Divergence and Public Policy: A Firm Level Perspective, Hutchins Center Working Papers. Baddeley, M (2006), ‘Convergence or Divergence? The Impacts of Globalisation on Growth and Inequality in Less Developed Countries’, International Review of Applied Economics, Vol.
7 The gap in manufacturing is around 50%. 8 UK estimates of firm-level productivity dispersion are based on Bank of England analysis of ONS data, whereas non-UK estimates of productivity dispersion are provided by the OECD. Differences in underlying data used may therefore play a role in Charts 5 and 6. 3  All speeches are available online at www.bankofengland.co.uk/speeches  3  low road. Capitalism always of course throws up winners and losers, hares and tortoises, gazelles and snails, upper and lower tails. In the UK, however, these differences are far-larger, and have increased by more, than elsewhere. And therein, I would argue, lie the roots of the UK’s productivity gaps. Let me start with the good news, focussing on companies on the high road. The first and most important point to make is that the UK does not lack for innovative, high-productivity companies. If you tour the UK, as I do, you find these “frontier” companies in every region and every sector. Their productivity is world-leading, their technology world-beating, their managers and workers world-renowned. They are inspirational. Micro-analysis of UK companies confirms this anecdotal impression. Chart 7 plots the distribution of UK 9  relative to French and German companies. There are more UK companies in the upper tail than in Germany, with its much-vaunted industrial reputation, and France. The top 10% of UK companies have levels of productivity at least 100% above the median.