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AS & A2 Economics | AQA AS & A2 Business and AQA & Edexcel GCSE Business
The Curious Case of Correlation and Causation
A former pupil has written an excellent blog on causation vs correlation in economics.As he writes, "the role of Economics is to understand where there is and is not causation." An important skill in life!
Read his blog here.
Economics Teacher National Conference - 23 June - London
We are delighted to announce two of the key note speakers for our annual Economics Teacher National Conference which this year is being held at the Wellcome Foundation Conference Centre on Euston Road, London. The date for the diary is Monday 23rd June!
read more...»Unit 2 Macro: 5 Years of Low Interest Rates
I am setting my AS macro students an essay this week evaluating the economic effects of five years of ultra-low monetary policy interest rates. Tom White blogged about this a day or so ago (click here) linking to an excellent article in the Guardian. It is a great way for students to deepen and broaden their understanding and awareness of recent developments in the UK economy.
Teaching colleagues covering monetary policy might want to use the data charts on interest rates contained in the PowerPoint file shown below.
read more...»Price Regulation in Industries
Regulation of prices through price capping has been a feature of regulation of the utilities in the UK for many years – although this is now being phased out as most utility markets have become more competitive.
Price capping systems
- Price capping is an alternative to rate-of-return regulation, in which utility businesses are allowed to achieve a given rate of return (or rate of profit) on capital.
- In the UK, price capping has been known as "RPI-X". This takes the rate of inflation, measured by the Consumer Price Index and subtracts expected efficiency savings X. So for example, if inflation is 5% and X is 3% then an industry can raise their prices on average by only 2% per year
- In the water industry, the formula is "RPI - X + K", where K is based on capital investment requirements designed to improve water quality and meet EU water quality standards. This has meant increases in the real cost of water bills for millions of households in the UK.
Advantages
Capping is an appropriate way to curtail the monopoly power of “natural monopolies” – preventing them from making excessive profits at the expense of consumers
Cuts in the real price levels are good for household and industrial consumers (leading to an increase in consumer surplus and higher real living standards in the long run).
Price capping helps to stimulate improvements in productive efficiency because lower costs are needed to increase a producer’s profits.
- The price capping system is a tool for controlling consumer price inflation in the UK.
Disadvantages
Price caps have led to large numbers of job losses in the utility industries
Setting different price capping regimes for each industry distorts the price mechanism
read more...»5 years of low interest rates: an evaluation exercise
There’s been lots of media coverage of a recent anniversary: it was five years ago in March 2009 that the Bank of England took the dramatic step of cutting interest rates to their lowest level in more 300 years. And there they have stayed - with some predicting they will stay low for a while longer yet.
How about a quick bit of analysis (why the Bank took the move) and then some evaluation? I’m suggesting an evaluation based on a recent Guardian article. Has it been a good move? Well – it depends – on who you are, for a start.
read more...»UK Economy: Mind the Gap: London v the Rest
Mind the Gap! Evan Davis has produced two superb programmes on the regional imbalances in the UK economy. In the first he focuses on the agglomeration / network economies of scale that help to explain the skew in business investment towards the capital. In the second he looks at which cities elsewhere in the UK might be drivers of renewed growth of incomes, investment and growth! Here are the links:
Mind The Gap Episode 1 - click here
Mind The Gap Episode 2 - click here
read more...»Unit 4 Macro: Low Investment Stifles the World Economy
Six reasons for low business investment are advanced in this article - private sector capital spending is a key driver of growth - why have companies been reluctant to authorize investment projects despite an environment of low interest rates?
Unit 1 Competitive Markets Revision Q&A - Student Licence for Just £5
Incomplete notes? Unsure of exactly what you need to know? Only a few weeks left before the exam?. Don't worry - you've come to the right place. Tutor2u's Q&A format is the rapid revision route to success.
Tutor2u Q&A's focus on the essentials of each subject covered. A comprehensive glossary summaries key terms and concepts. Test your understanding against 100's of questions designed to cover all aspects of the syllabus.
You can cover the syllabus in rapid time, knowing that you are focusing your effort on the essentials for success. No wonder, tutor2u's Q&As are the best-selling online rapid revision guides available for AS and A2 economics.
Details can be found here
AS Macro Quick Revision Guide (Spring 2014 Edition)
Our new 44-page, full-colour printed revision guide is designed to support students preparing for their AS Economics exams on macroeconomics. The guide provides comprehensive coverage of the core macroeconomic topics for AS Economics, grouping them into the following areas:
read more...»Lessons from WWI in Behavioural Economics
Here is a short article written by Agatha-Christie Onwuzuruike - a student on the Eton Summer School who has won a coveted place to read for PPE at Oxford.
The centenary of the beginning of the First World War is fast approaching. Not only is it a time to remember those that lost their lives in the greatest sacrifice; it offers economists young and old a lesson in behavioural economics
read more...»Some Topical Issues in Trade and Development
I was delighted to give a talk to A2 economists at Wilson's School in Surrey today covering some aspects of trade and development economics. In particular we looked at the work of Hidalgo and Hausmann and their newly published Index of Economic Complexity. The slides from my talk are streamed below.
read more...»Pistorius and Market Failure
When discussing market failure, we often talk about merit/demerit goods, public goods, monopolies etc.
Underpinning many of the market failures is the idea that the profit incentive (which can be a force for good when it comes to innovation and choice) can create incentives which are rather less savoury, and unscrupulous ethical morals can be argued to drive many market failures.
Paddy Power are in the limelight - with a petition set up for Change.org to ban their bets (currently with 24,000 signatories) - offering odds on the outcome of the Pistorius pre-meditated murder trial.
"A Paddy Power advert promoting a ‘money back if he walks’ offer for bets on the Oscar Pistorius murder trial has prompted numerous complaints to the Advertising Standards Authority, and an online petition for it to be pulled.
The company had already caused outrage earlier this week by offering odds on the outcome of the premeditated murder trial - 7/4 for a guilty verdict and 2/5 for not guilty - with many Twitter users branding the gimmick ‘vile’ and ‘disgusting’."
Read more here.
It also reminded me of this video from Wharton - Does Studying Economics Make You Greedy?
Read more on it here.
Quiz on the Index of Economic Complexity
The Atlas of Economic Complexity is a new book (perfect for the coffee table) from Richard Hausmann and Cesar Hidalgo. It maps out the degree of complexity of individual economies around the world and provides a hugely visual and interesting insight into the importance of knowledge in shaping the future prosperity of countries in the global economy. I have put together a 10 question quiz on some of their key results - a useful activity I hope for students interested in the commodity composition of trade of developed and developing countries. Have a go!
read more...»Unit 2 Macro: Economic Growth
Here is a revision presentation for an AS Macro topic - economic growth
read more...»‘Real World Economics’ 2014 - Sport, Health & The Economy
It's that time of the year again when the Economics Students at Greenhead College host the annual 'Real World Economics' Event whereby all things Economics are presented with a specific link to everyday events that we encounter. The theme this year is centred on the impact of sport and health on our Economy.
read more...»Unit 2 Macro: Multiplier and Accelerator Effects
Here is a revision presentation for an AS Macro topic - the multiplier effect, the accelerator effect and Keynesian economics
read more...»Lecture on the UK Rail Industry - 18 March 2014
Staff and A2 pupils who live in the Bath area might be interested in attending a lecture at Monkton Combe School on Tuesday 18th March from 5.00-6.00pm. The topic is rail privatisation and it will be presented by Graeme Hampshire, Director of Stagecoach Rail. He will be covering the structure of the UK rail industry, the performance to date since privatisation and looking at the finances of a train operating company and how they bid for franchises. He'll conclude by examining how reality managed prediction and he'll then take questions from the audience. This presentation should be excellent preparation for anyone studying for A2 Transport Economics. If this is something that interests you please send an e-mail to Robert Campbell on campbellrcf@monkton.org.uk.
Unit 2 Macro: The Economic Cycle
Here is a revision presentation for an AS Macro topic - the economic cycle
read more...»IMF joins in the inequality debate
Inequality might be falling between nations as a global middle class is emerging, but inequality is on the rise within nations. Quite why this is happening is a matter of debate, but the International Monetary Fund (IMF) has joined in the discussion asking if rising inequality is an obstacle to economic growth and development.
read more...»Economics News Quiz - 27 February 2014
Here is our weekly ten question economics news quiz created using the Zondle platform - create your own quizzes for free using Zondle!
read more...»Unit 2 Macro: Macroeconomic Equilibrium
Here is a revision presentation for an AS Macro topic - macroeconomic equilibrium
read more...»Paul Ormerod: Forward guidance needed for companies, not consumers!
Most of the commentary on the UK’s economic recovery focuses on consumers. Are they taking on too much debt again to finance their spending? Is there a bubble in house prices, as people get excited about bricks and mortar again? Certainly, in terms of its sheer size, spending by consumers is by far the biggest component of GDP, making up around 60 per cent of total domestic expenditure.
read more...»The Future of Fairtrade
Radio 4 on the future of Fair Trade as the label marks its 20th anniversary. Some are arguing that a new initiative is weakening the foundation's founding vision. What makes Fair Trade fair? Is it really Fair Trade? Listen to it here.
Michael Metcalfe: We need money for aid. So let’s print it
During the financial crisis, the central banks of the United States, United Kingdom and Japan created $3.7 trillion in order to buy assets and encourage investors to do the same. Michael Metcalfe from State Street argues that these same central banks print money to ensure they stay on track with their goals for global aid? Without risking inflation? A Print-Aid matching scheme could boost aid payments by up to 40% or $200 billion.
read more...»Panel Event 19th March - The Future of the British Economy
On Wednesday 19th March 2014, the Eton College Keynes and Political Societies are joining forces for a panel debate titled: 'The Future of the British Economy.' In front of 600 students and teachers, Kwasi Kwarteng MP (Conservative Party), David Blunkett MP (Labour Party), Natalie Bennett (Leader of Green Party), Lord Bilimoria (Chairman of Cobra Beer) and Jonathan Portes (Director of the National Institute of Economic and Social Research) will debate the prevailing issues concerned with the British Economy and what lies ahead in the future. It will be an event of great collaboration, interactivity and engaged learning. It will start at 8.15pm, with a pre-meeting reception for visiting schools taking place from 7.15pm Everything will be wrapped up by 9.45pm. The event will be taking place at Eton's largest auditorium, School Hall.
One of the main aims of this event is to open Eton's doors to as many schools as possible. 30 schools attended our last panel event in November and we'd like to hit this target again. We would delighted for your school to bring a group of students and teachers interested in this issue to the event. Every school receives a personal treatment on the night and is allocated a boy to welcome them upon arrival, take them to the venue and help them throughout the evening.
We hope that you can join us for it.If you would like to bring a group of students, please could you email Anthony Beaumont on
University of Warwick 2014 Economics Summer School
Casey Orrin from the University of Warwick has kindly passed on to us details of their first ever Summer School for Economics.
read more...»A minimum wage in Germany - but the low-skilled jobs are in the UK
In Germany the government has reluctantly agreed to introduce a minimum wage of €8.50 (£6.98) per hour. Angela Merkel's conservative Christian Democratic Union party is opposed to the idea, but need to make concessions in coalition negotiations with centre-left parties such as the Social Democrats, who have campaigned for a national minimum wage.
read more...»Unit 2 Macro: Aggregate Supply
Here is a revision presentation for an AS Macro topic - aggregate supply
read more...»Growth and Development Challenges and Opportunities for Mexico
In this independent research assignment, Year 12 Economist Doug Feagin considers some of the factors influencing the macroeconomic performance of Mexico - a fascinating country and one of the MINT cluster of countries discussed by Jim O'Neill in his recent programmes for the BBC.
read more...»Student Enrichment - Whitonomics is Launched!
We are delighted to showcase on the blog a new edition of Whitonomics - designed, written, edited and published by the engaged students at Whitgift School. Please do take a close look at this superb publication. Our good friend Oliver Fernie has supported the project within the Whitgift Economics Department, he rightly says that "It teaches them so many transferable skills and stretches them beyond the AL/IB & IGCSE syllabus.'
Do you have a school/college student run magazine that you would like to show to the world? We are always happy to flag them up on the Tutor2u economics blog!
New evidence of persistent gender bias at the UK’’s top companies
The UK’s biggest companies remain biased when appointing women to their boards, according to new research by Dr Ian Gregory-Smith and colleagues, published in the February 2014 issue of the Economic Journal
read more...»Executive Pay: Shareholders have failed to curb excesses
Despite public calls for shareholders to get tough on executive pay, a new study of the UK’s highest paid company directors reveals that shareholders are overwhelmingly inclined to approve the pay packets of top directors, just as they were before the crisis
read more...»Manufacturing in Africa
Economics coverage of Africa can be a bit bleak (though perhaps it shouldn't be, with incomes rising rapidly in parts of Africa). There are often bad news stories, particularly in terms of human development indicators. News of economic progress often centres on the exploitation of primary commodities, with all the risks and issues that presents.
If you hope Africa will experience development, you’re likely to want to see sustained and robust economic growth. That, in turn, will require industrialization.
read more...»Unit 2 Macro: Aggregate Demand
Here is a revision presentation for an AS Macro topic - aggregate demand
read more...»Teaching Vacancy - Head of Economics and Business Studies - Sutton Valence School
So many excellent HOD opportunities are arriving at tutor2u - and here is yet another! All the details below about how to apply to join this thriving Economics and Business dept.
read more...»Teaching Vacancy - Head of Economics - City of London School for Girls
Another fantastic HOD Economics opportunity here - this time with our friends at City of London School for Girls. Don't forget to mention that you saw this one on the Economics Blog!
read more...»Unit 2 Macro: National Income and the Standard of Living
Here is a revision presentation for an AS Macro topic - measuring national income and the standard of living
read more...»Unit 2 Macro: Circular Flow and Macro Objectives
Here is a revision presentation for an AS Macro topic - the circular flow and macroeconomic objectives
read more...»Transport Economics - compensation for rail delays
Did you know that most train operating companies will refund 50% of your ticket for a delay of 30 minutes or more, and will double that if the delay is for an hour or longer? And that, if you are travelling by tube, Transport for London offers refunds if your journey is delayed by 15 minutes or more (although you won't get a refund if the delay is caused by a security alert, "third party action" such as a strike or bad weather)? Most probably you didn't, as a survey by the Office of Rail Regulation has found that more than 75% of rail passengers know "not very much" or "nothing at all" about what they are entitled to when services are disrupted.
The report also found that 74% of passengers felt that train companies do "not very much" or "nothing at all" to proactively provide information about compensation when there are delays. As Simon Gompertz found in this video report, there are plenty of ways in which the train operating companies could make the information available, whether through instructions on the back of the tickets and announcements on trains to apps.
read more...»All the basics of UK government debt and deficit
To follow up on Hugh Pym's video which explains the difference between government debt and government deficit, here is another fantastic resource. Definitions, data and descriptions of debt and deficit, chapter and verse on the structural deficit and on government borrowing. It looks like the perfect lesson resource - as its title says, all you need to know.
Unit 2 Macro: Debt and Deficit explained using coloured sweets
The BBC's Hugh Pym helps us to avoid a common exam mistake - namely confusing debt with deficit.
read more...»Unit 2 Macro: Hints on Exam Technique
Here is an updated revision presentation on aspects of exam technique for the Unit 2 AS Macro paper
read more...»Unit 3 Micro: Facebook Buys WhatsApp
In a bold move in the continuing battle between Facebook and Google to dominate the next phase of digital / mobile growth, Mark Zuckerberg's listed business has agreed an £11bn acquisition of WhatsApp - a deal to be paid in a combination of cash and shares.
The total value of the deal is staggering high for a business that employs just over 50 people.
- The price Facebook is paying for WhatsApp is more than ten times what Google spent on YouTube
- It is more than 20 times what Facebook paid for Instagram
- The $19bn paid for WhatsApp works out at $40 for each of its 450m users!
- The $19bn deal to buy WhatsApp is more than 10% of the annual value of Ukranian GDP
What are some of the justifications for such a mega-priced deal?
read more...»Masters Of Money -Friedrich Hayek
A You Tube version of the BBC documentary on Hayek
read more...»John Maynard Keynes - Video Resources
A selection of video resources for students and teachers interested in Keynesian economics
read more...»John Maynard Keynes - Video Resources
A selection of video resources for students and teachers interested in Keynesian economics
read more...»German revival exposes deep fissure within Europe’s economies
In the 1990s and early 2000s, Germany was seen by many as the new ‘Sick Man of Europe’. Between 1991 and 2005, GDP growth averaged only 1.2 per cent a year, compared to 3.3 per cent in the UK. Since then, the German economy has revived dramatically. The recovery in the German cluster of economies from the financial crisis has been as strong as in the United States, with the previous peak level of output being regained in 2011. Germany itself experienced virtually no increase in unemployment in 2008 and 2009, its exports are at record levels, and even the crisis in the Euro area has not prevented expansion in both output and employment.
read more...»UCAS Guide for Economics (Feb 2014 Edition)
This is an updated version of my advice guide for students wanting to apply for an economics related degree at UK and overseas universities.
read more...»Teaching Vacancy - Economics & Business at Morpeth School, Tower Hamlets
Many thanks to tutor2u blogger and presenter Stuart Block for alerting us to a superb teaching opportunity to help an outstanding inner city London school develop its Economics & Business Departments.
Stuart writes:
Morpeth School has been one of the drivers of the rapid improvement in education in the London Borough of Tower Hamlets in recent years. Rated by Ofsted as outstanding last year, a major focus over the next 3 years is improving its 6th form.
Economics was introduced for the first time at the school in 2013 and Business Studies has also been re-established at A-level. Although the details are yet to be confirmed, the school will be looking for an economics & business teacher for September 2014 to join the rapidly growing department.
If you're interested, do drop the Head of Economics, Stuart Block, an email with your CV at sblock@morpeth.towerhamlets.sch.uk.
Job Vacancy - Head of Economics & Business at Pangbourne College
Our friends at Pangbourne College have been in touch to ask us to let teaching colleagues know about a HOD opportunity for Economics & Business which is bound to attract some high quality candidates. All the details below.
read more...»
