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1/ Thought.

Wales' economy lacks linkages and requires development policies/spending.

It's treated as a component of a developed economy.

Consequence 1: low capital expenditure leads to lower productivity & limits potential for new growth.
2/ Consequence 2: Low productivity limits competitiveness so limits inward flow of money locking Wales in a vicious circle.

Conclusion 1. Wales is locked in a suboptimal economic/constitutional arrangement in which the currency is too strong relative to its economic performance
3/ Conclusion 2: Inability to adjust capital expenditure restricts the creation of new linkages in the economy that leads to growth.

Conclusion 3: Scale comparison and electoral calculus makes the Welsh economy a low priority for the UK government.
4/ Solution: Welsh Government must be sole political authority in deciding capital expenditure & free to issue currency & bonds to finance the Welsh economy. The Senedd must be the sovereign political body holding the Welsh Government to account. Statehood a necessary condition.
This part is the consequence of de-industrialisation with the transition to a service economy focused on SE England. This leads to the Welsh economy losing its prior economic capital without sufficient renewal owing to failure of UK Govt to balance the economy.
One common govt approach is to pump in public money via relocation of public employment. But this money does nothing for economic capital and so fails to form linkages on the necessary scale or improve productivity.
The other major approach is to attract inward investment via grants etc. Something of a race to the bottom. This incoming capital is highly mobile and tends to be temporary. Moreover, the value created by the labour is not recycled through the Welsh economy so v limited benefit.
The reason this capital is lost is because despite Wales being the first industrial nation, the economic institutions that developed alongside were mostly outside of the country. The aim wasn't Welsh economic development, rather self-interested enterprise & profit.
The lack therefore of Welsh Statehood leads to the lack of Welsh economic institutions creating yet another limitation on the Welsh economy. We need Welsh Civic, Civil and Economic with the skill, knowledge & expertise to allow our economy to flourish.
In short we should build these institutions in parallel with the democratic Welsh State.
If the political will existed within the UK state to achieve the same end, it could achieve the same economic outcome. Political and economic calculus weighs against this. A hundred years of history attests to this fact.
The Government of a Welsh State would not be similarly distracted. It would have no choice but to put our economy at the forefront of its everyday business as it would be held accountable only to the Welsh citizenry, its sovereignty derived directly from them.

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