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There has been renewed focus in recent weeks on the slowing growth rates in the BRIC countries - Brazil, Russia, India and China. It is inevitable that the pace and sources of growth will change as these countries develop and experience continued structural adjustments. How successful will they be in responding the the challenges and opportunities of the next stage of development? In this blog we link to some recent articles on the BRIC countries for students wanting to deepen their understanding of this important area of the A2 macro course.read more...»
Here is another good resource for students who are looking at prospects for the Chinese economy as part of their macro economic studies. While the Chinese economy continues to slowdown, policymakers in Beijing are faced with the dilemma of how to rebalance an economy that till now has relied heavily on investment. The FT's Simon Rabinovitch reports from Guiyang. A re-balancing China will have to be a slower-growing China.
Follow the tags at the bottom of this blog for connections to all of our recent Unit 4 macro blog entries on China.read more...»
The pace of growth of the Chinese economy is weakening with new data showing an annual growth of real GDP dipping to just over 7%. China's economy is re-balancing away from investment and exports towards consumption. But at present there is a squeeze in household spending. Consumption in China contributed 60.4% to GDP growth in first half of 2012, only 45.2% in the first six months of 2013.
We link here to some resources on the issues surrounding the reduction in growth rates for the Chinese economy.read more...»
They dominate the major championships in long distance events and the standard of their running is so high that several runners have opted to compete for other countries in order to gain selection for World and Olympic events. What makes Kenyan distance runners so good? From where have they established their enduring competitive advantage? Are there parallels and lessons for countries wishing to compete in the global economy? This news feature from the Guardian offers some interesting clues!read more...»
This new short video from the IMF takes a look at a group of fast-growing countries known as Frontier Asia. Asia's developing economies represent the region's economic frontier, emerging as a new source of economic dynamism. These countries aspire to climb the development ladder by addressing the challenges of infrastructure, technology and financing.read more...»
A short but useful infographic from the Economist - perhaps a resource when teaching aspects of globalisation. Foreign direct investment decisions show how the global economy is different since the financial crisis.read more...»
KAL, The Economist's resident cartoonist and animator, explains global trade
Economic imbalances are a recurring theme in discussions about prospects for the world economy. We link here to a recent lecture given at Gresham's College on some of the consequences of growing divergences between nations that are net savers and countries that are net debtors.
This lecture will look at the world surplus of savings as incomes gradually shift proportionally towards those who traditionally save a high proportion of their earnings and away from those who traditionally spend most of what they earn. In theory, the excess savings should be matched by higher investment. In practice this is not happening.
Dr Linda Yueh gave a fantastic talk at the ETNC on the growth and development challenges facing China in the years ahead. Here is a shortened version of a recent talk given by her at the RSA in London in April 2013. We have also streamed the contents of the presentation for those who want to follow the talk in more detail.read more...»
Another great short animated video from the Economist - highly relevant to students looking at the economics of protectionism / import controls. KAL, The Economist's resident cartoonist and animator, explains what dumping means and why companines do it.read more...»
Hundreds of millions of people around the world are escaping poverty and becoming middle class. The explosion of new consumers in China, India and other economic powerhouses is changing the global balance of power. The BBC website has a new series on exploring the effects of this shift in global economic power and influence - click here for further research and watch the video below
Every year billions of dollars in aid go to the world's poorest countries. But does it help these countries to grow out of poverty? The question is as old as foreign aid itself. In this RES short video, Michael Clemens of the Centre for Global Development presents award-winning research that offers a new way of answering this question
Another RES short video from Bob Denham at Econ Films. The size and location of cities follows a clear pattern -- you just need to look at them from far enough away. Wen-Tai Hsu of the National University of Singapore shows this with the help of economics. This research received the Austin Robinson Memorial Prize at the Royal Economic Society annual conference in April 2013. Some important themes mentioned here for students of economic geography.
SPOTTING and identifying new species is always exciting. And the last couple of years has seen the emergence of a new type of economic commentator, the recovery denier. Paul Krugman, the Nobel prize-winning economist, wrote a piece at the end of last year in which he compared the current situation to that of the 1930s. On Newsnight recently, another Nobel economist Joseph Stiglitz poured scorn on my assertion that the US economy has recovered.
But what does the data tell us? In the 1930s, output in America fell by nearly 30 per cent from its 1929 peak. This time, the fall was only 3 per cent, and the level of output is now higher than it was below the crash. The latest US labour market figures show continued growth in employment. Over 5m net new jobs have been created over the past three years, all of which have been in the private sector. Unemployment has just fallen to a four year low.
The scale of the new London Gateway Super deepwater Port is truly stunning and its importance to the economy as a trading nation is hard to underestimate - Britain will have a new world class hub port in a key location impacting on many trades and services in and around the South East and beyond. It has taken 10 years to establish and build this huge new infrastructure project, building eventually started in 2008.
Behind the port sits Europe's largest logistics park connected to the South east by road and rail.
This Financial Times news video looks at the background to the project - it is a good example to consider of the macroeconomic consequences of the investment. What price a new Thames Estuary airport (supported by Boris Johnson) to amplify the transformative impact in the years ahead?
Update: BBC news (November 2013) - click hereread more...»
The pricing of carbon emissions needs to be sensitive to both long-run climate outcomes and short-term concerns about the macroeconomy. Research by Reyer Gerlagh and Matti Liski reconciles these two timeframes and comes up with optimal prices of between €20 and €130 per ton of carbon dioxide.
The post global financial crisis period is seeing a burst of innovation in the financial system as new platforms of funding especially for businesses seem to be gaining some traction even if they remain very small contrasted with the scale of established banks. This short report from the FT visits a conference on behavioural finance held at Oxford University and quizzes some leading figures on key developments in embryonic, emerging financial businesses. Having watched the video engage in some independent research on peer to peer lending and other fast-growing markets.read more...»
I have to come clean as a self-confessed container nerd (geek alert: follow the world’s containers using this amazing tool). Not only are the ships hugely impressive from an engineering perspective, but they are a gift for an Economics or Business enthusiast. You might want to be thinking about economies of scale, or the negative externalities associated with transport – or perhaps discuss supply side issues and infrastructure. Container ships cover the lot.
A while ago I argued that container shipping is the greatest of all 20th century innovations, and this week The Economist has reported that the container has been a greater driver of globalisation than all trade agreements in the past 50 years taken together.read more...»
Here is a video report from the fast-growing country of Indonesia where infrastructure deficiencies threaten their sustainable growth rate.read more...»
The BBC's Chief Business Correspondent Linda Yueh @lindayueh has new page on developments in global economy http://www.bbc.co.uk/news/correspondents/lindayueh/ - definitely one for students and teachers to follow. The opening article focuses on a concept that we have been pushing in our own macro coverage in recent times, namely the emergence of a multi-polar world economy with growth coming from a bigger number of countries / regions and less dependent on the advanced western economies. Read the article here
Well according to this Economist article there is. Great fodder for A2 students looking for genuine examples of supply side policies and in this case of a government seeking to encourage industries to move up the value chain and wean them of low cost low skilled immigrant labour. Problem is there are unintended consequences:
The distinguished American academic economists, Carmen Reinhardt and Ken Rogoff, have been very much in the news. Their 2009 book, This Time is Different, was a comprehensive examination of financial crises over the past 800 years. The work received many plaudits and awards. They suggested that when the ratio of public debt to GDP in a country rose above the 90-100 per cent range, the chances of a financial crisis increased sharply. And the consequence was that economic growth in the country would be adversely affected.
Link here to a revision note on aspects of growth and development in India (revised April 2013)read more...»
He's back but he's still angry! In this latest version of The Angry Economist, our favourite curmudgeonly analyst wants to know students' opinion on George Osborne's economic policies - no wonder his blood pressure has risen!
This simple Powerpoint resource is aimed at getting your students to analyse and evaluate economic policies - 8 of the Chancellor's policies are presented and the Angry Economist randomly picks a macro-economic objective to consider. All you have to do is get 8 volunteers from your class to do the analysing - a great 10 minute activity whilst revising for the up-coming macro exams at either GCSE, AS or A2 level.
Here is a list of the policies the Angry Economist wants students to look at (you may wish to recap on them before you start the activity):
- Reduce Government debt
- Increased number of private sector jobs
- Increased allowance before Income Tax needs to be paid
- Cut Corporation Tax
- Set up Regional Growth Fund
- Funding Lending Scheme
- Deregulating some planning rules
- Frozen Council Tax
Of course, the beauty of this resource is that you can change any of these policies to whatever you want them to be.
Click on this link to download the Angry Economist 2.
PS. Click on this link to have a look at the original Angry Economist.
Here are some notes taken from a talk given by Linda Yueh on the Chinese economy at the RSA in London on the 18th April, 2013read more...»
The latest edition of African Pulse published by the World Bank focuses on growth and development prospects in Sub-Saharan Africa and the overall sentiment is that the region is set to continue with a strong growth performance.read more...»
Fantastic interactive website here lets you check out migration flows both inward and outward from any country you care to look at.
The LSE’s Jason Hickel writes, narrates and directs this short video looking at the extreme truth of how wealth is divided globally.
The recent debacle in Cyprus has essentially been shrugged off by the markets. The European Central Bank vigorously asserts the crisis in the Euro zone is over. So why is there continued unease about the financial viability of countries such as Spain and Portugal, a morass into which even the French are now being dragged?
Economic theory helps us understand a bit more about why this is the case. One thing which the last few years in Europe have shown very starkly is the massive difference between debt which is denominated in nominal terms and that which is in real terms. Nobel Laureate Chris Sims makes the point clearly in his recently published Presidential Address to the American Economic Association.read more...»
A newly constructed Social Progress Index has been unveiled for the first time with the hope that over time, it might become as widely quoted and recognised as the Global Competitiveness Index as a benchmark of progress made by individual countries in achieving sustainable, balanced and inclusive growth and development. In the 2013 rankings, Sweden comes first and the United Kingdom is second.read more...»
The annual NORFACE migration conference at University College London this week has generated plenty of new research papers on the economics of international migration, a topic that of growing significance for students of globalisation, competitiveness, innovation and growth. Some of the key findings are summarised below together with external links to relevant articles and news reportsread more...»
A recent World Bank report asked ‘Where is the Wealth of Nations?’ Calculations presented at the Economic History Society’s 2013 annual conference show that for Britain, the answer is undoubtedly in its people.
Dr Jan Kunnas and his colleagues calculate that Britain’s ‘human capital’ has grown by a multiple of 123 over the past 250 years. The main drivers of this phenomenal growth have been the growth in the workforce and the growth in wages.
The researchers define human capital as the knowledge and skills embodied in individuals – and they measure it by the discounted earnings the population is expected to earn during their time in the labour force.We have an extended revision note on human capital and economic growth - read it here
The Changing Wealth of Nations - World Bank reports can be accessed here
New figures from the OECD find that overseas development aid fell by 4% in real terms in 2012, following a 2% fall in 2011. Aid payments have dropped in large party because many governments of developed countries are embroiled in fiscal austerity and choosing to cut aid as a result. The OECD data shows too that there is also a shift in aid allocations away from the poorest countries and towards middle-income countries.
This 10-question revision quiz focuses on the theory of international trade.
A brief overview of economic developments in Angola, one of the fastest growing countries in the world - contains updated links to study resources on Angola.
Here's a 5 to 10 minute activity for your post-Easter classes on macro-economic objectives - The Angry Economist! The design is very loosely based upon the 'Angry Bird' game.
You will need up to 8 volunteers to answer the 'Angry Economist's' questions.
Each student can choose a Government policy named on-screen and then the Angry Economist randomly chooses a macro-economic objective. The student has to to apply their knowledge and understanding of their chosen policy to the macro-economic objective shown.
The screen encourages the student to analyse and evaluate their own answer.
Use this link to access the resource. Give it a go!read more...»
This 10-question revision quiz focuses on the balance of payments.read more...»
Revise the development topics of overseas aid, micro finance and Fair Trade and then test yourself with our short revision online quizread more...»
Revision blog on the economics of foreign direct investment in Africa with a special focus on investment from China and other BRIC countriesread more...»
Here is a selection of resources on the Cyprus banking crisis and the controversial bail-in of uninsured large depositors. Particular credit to the team at Saxo Bank for an excellent info-graphicread more...»
Attention is often focused on the tariff and non-tariff barriers to trade and in particular, the extent to which trade from developing countries to advanced high-income nations is influenced by import taxes. Average tariff rates have come down to historic lows in recent years although non-tariff barriers proliferate.
New research from a group of European economists finds that trade costs - a concept that captures the broader expenses of getting goods and services across borders into international markets - are much higher than tariffs. And for developing countries these costs have not fallen to the same extent as richer countries.read more...»
A team of Economic students at Greenhead College, led by A2 student Harry Edwards, recently organised and presented the inaugural ‘Real World Economics’ event during which many Economics and Business issues were showcased. Donations from the evening have been given to a Micro-finance agency ‘Kiva’. The committee have created a portfolio of loans for specific entrepreneurs in developing countries. These loans allow them to grow their fledgling businesses, meaning that they become better equipped to provide for their families and improve their standard of living without becoming excessively dependent on unsustainable levels of aid from developed countries. The hope is to give these people, along with their families and communities, an opportunity to forge a better life for themselves.
Some of the investments undertaken by the committee include a Housing programme in Nicaragua and Agriculture in Rwanda.
Oxfam senior researcher and former co-author of the UN's annual Human Development Report Kate Raworth visits the RSA in London to explain 'doughnut economics' -- the bold new theory that is sweeping the development world. A really clear seventeen minute video covering some of the key environment challenges that threaten sustainable growth and a call to make central to the debate the protection of natural capital and social capital.
As part of our revision for the Unit 4 macro paper we have been discussing in school growth and development issues in South Korea. The country now has a per capita income in excess of $30,000 and is a high-income developed country with membership of the OECD. Having escaped the middle-income trap, can South Korea continue to prosper or will the country have to modify their development strategies to meet fresh competitive challenges and changing expectations?
Oxfam senior researcher and former co-author of the UN's annual Human Development Report Kate Raworth visits the RSA to explain 'doughnut economics' - the bold new theory that is sweeping the development world
Aggregate Demand may be stimulated by an increase in exports. Ha-Joon Chang, Author of the best seller, 23 Things They Don’t Tell You About Capitalism considers reasons in a short article for The Guardian why this hasn't happened after Sterling had fallen against other major trading economies. " Compared with ...2007, the pound has been devalued about 30% against the dollar, 50% against the yen, and 20% against the struggling euro. Yet despite the huge incentive to export created by such devaluation, Britain is still running trade deficits because it has lost the productive capacity to respond."
It may help students consider plausible policies to reduce its trade deficit, a macroeconomic goal overlooked in arguments over fiscal and monetary policies to control inflation or output. Finally it may aid evaluation, how different are the most pressing short and long term macroeconomic challengers facing UK governments.
Link to most trade figures.
Mobile commerce can be an important driver of growth and development. Here is an example of emerging business opportunities for leveraging the power of mobile telephony in Indonesiaread more...»
This is great for understanding key shifts in global trade and investment. The Economist offers this short video on the rising prominence of Chinese money in property and currency markets and FDI from Chinese businesses within the EU.read more...»
The Middle-Income Trap has become a popular and much quoted concept in development economics. Much discussion on the policies and strategies to lower the risks of growth slowdowns before a country has achieved high income status. But how relevant is the middle income trap? The absence of a clear definition of the idea makes it difficult to measure, this article from the Economist has a go and is highly relevant for students taking courses in development economics, especially EdExcel Unit 4.
Raising productivity and sustainable yields in the farm industry is a crucial component of the development/growth agenda in India. Here is a case study from Guardian Global Development of progress in achieving this aim.