Unit 1 Micro: Capital used to Build Cross Rail
The tunnelling equipment involved in CrossRail - Europe’s biggest civil construction project - is immense in every way! This BBC news video of the earth cutting machinery is a brilliant visual to use when teaching economies of scale or introducing the concept of physical capital! The machinery is made in Germany naturally!
Unit 1 Micro: Empty Housing and Economic Efficiency
Channel 4 recently focused on the causes and effects of the hundreds of thousands of empty homes in the United Kingdom. Why is it given persistent shortages of affordable housing that perhaps a million homes lie empty and unused whilst an estimated two million families are in severe housing needs. New housebuilding has collapsed and in Britain we are building 100,000 fewer new houses every year than we need just to keep up with the changing mix of households and demographic change.
An interesting exercise is to show students some of the Channel 4 Campaign videos and then get them to put together policy ideas as to how to reduce the volume of empty homes and reduce the length of housing waiting lists.
Links to some of the Channel 4 videos can be accessed below:
read more...»Economics at the Movies: In Time
This weekend I saw this Justin Timberlake movie, In Time, which has quite an original concept – that time is a currency. The plot revolves around the idea that we all have a limited amount of time to live, but that same time is the currency we earn by working and then used to purchase consumption such as ‘4 minutes for a cup of coffee’.
read more...»Economics on YouTube
A useful clip for AS micro: barter economies. Or, alternatively, for A2 micro: perfect price discrimination.
The Principles of Economics - translated…...
Many thanks to one of my students from last year (thank you, Henry!) who has just attended his first undergraduate Economics lecture and enjoyed this YouTube clip. It shows Yoram Bauman, self-appointed Stand-up Economist, making a presentation to the AAAS (American Association for the Advancement of Science) in 2007, in which he translates the Ten Principles of Economics.
Five minutes of good fun, at the expense of economists who take themselves too seriously, which you and your students might enjoy as a contrast to the gloom of impending meltdown - although I wouldn’t want to spoil the fun of their first lecture at university.
read more...»Unit 1 Micro: Sleep, Money, Happiness and Choices!
Autumn is arriving here in the UK. I cannot have been alone in finding it tough to drag myself out of bed on Friday morning to teach at the end of a tiring week. The marginal utility of an extra hour under a comfy duvet was so appealing, fortunately so too was the prospect of discussing the Greek debt crisis! Here is an interesting choice to put in front of your students - sure to prompt discussion.
read more...»Unit 1 Micro: Division of Labour
The division of labour occurs where production is broken down into many separate tasks. Division of labour raises output per person as people become proficient through constant repetition of a task – “learning by doing”. This gain in productivity helps to lower cost per unit and ought to lead to lower prices for consumers. But there are obvious limits to the division of labour.
read more...»Study Note - The Basic Economic Problem: Scarcity and Choice
It is often said that the central purpose of economic activity is the production of goods and services to satisfy our changing needs and wants.
Study Note - Economic Systems
Economic Systems
An economic system is a network of organisations used by a society to resolve the basic problem of what, how much, how and for whom to produce.
read more...»Study Note - Finite Resources and Sustainability
Starter Activity: Health Economics
This is a follow-up blog to Ben Cahill’s superb idea for a first lesson in economics focusing on making tough choices about resource use with a kidney dialysis machine. See: An activity for the first Economics lesson of the year!
I too will be using health care economics as a starter activity with my AS micro groups this year. I was interested in finding out some of the assumed costs of different health care treatments offered by the NHS and my research took me to published cost/price lists used by NHS Scotland. Drawing on a detailed spreadsheet I selected the following:
read more...»Unit 1 Micro: Opportunity Cost -
A hat tip to John Wilson from New Zealand for spotting this superb article which looks at smarter consumer spending and using opportunity cost as a concept to put some of our many choice in context. Some great examples here that might be used at the start of an AS Micro course.
Theory Thursdays! Interesting indices
Most students will now have met indices in some shape or form in their A-level course, probably in relation to the Consumer Price Index. This extension activity helps students to develop their understanding of the construction of indices in general. As a starting point, you may want to ask your students to contribute towards the latest Economist Big Mac Index, which looks at the price of a Big Mac in various cities around the world in order to work out whether exchange rates are over- or under- valued as well as the cost of living in various countries. The Economist has asked people around the world to go into their local McDonald’s and then post the price of a Big Mac onto their online forum - you can do this here.
read more...»Lesson Worksheet - Scarcity and Choice
Here is an mcq-based worksheet on the basics of scarcity and choice.
Download lesson worksheet on scarcity and choice
What can you do with a degree in economics?
I was looking for some data on UK Universities and came upon an article featured in The Guardian (25th June 2010) titled “What to do with a degree in economics?”. It is often a question asked by both parents and pupils and could be a useful handout for colleagues.
Read the article here
Erotic economics
We’ve seen various attempts at tax avoidance before, with the likes of the big debate about whether Jaffa cakes are truly biscuits or cakes , but today another “interesting” example appeared in the news here.
The Erotic Cinema in Belgium claimed it should benefit from the reduced 6% rate of VAT (instead of the normal 21%) paid by cinema owners, who get a discount under law to promote cultural activities. Perhaps unsurprisingly, it was rejected by the ECJ!
How do you shop?
Lip gloss is the new lipstick according to the ever-changing basket of goods and services that make up the CPI basket, discussed here.
read more...»Norway - your guys take a lot of beating!
Roy Hattersley makes a rare appearance in the economics blog today. He has an interesting piece in The Times on the relative prosperity of Norway - a country that lies outside the European Union but which has negotiated access to the EU single market. With very low unemployment (of less than 3% of the labour force, super high per capita incomes, a sovereign wealth fund worth more than £250bn and continued strong revenues from oil exports, Norway is unlikely to test the waters of EU membership anytime soon. A good piece for students of economic integration in the EU.
Economics of Healthcare - Introductory AS Microeconomics
I won’t be alone in choosing the thorny issue of healthcare as an introductory topic in AS microeconomics when we kick off next week. The agenda is vast and it is a topic that can be returned to on a regular basis as students accumulate a body of knowledge, concepts and fine-tune their evaluation skills. There is a streamed presentation available here
read more...»Q&A: How the PFF might be used in assessing a country’s economic performance
A production possibility frontier (PPF) is a boundary which shows the combinations of two or more goods and services that can be produced whilst using all available factor resources efficiently.
read more...»Images from a planned economy
This link might be useful for colleagues wanting to add to their image library when teaching economic systems. Most of these images seem to hark back to the days of state planned output, rigid price controls, long queues and a distinct lack of choice! I love the image of a shelf of soviet astronauts - light years before Buzz came along!
Q&A: Will the UK economy’s PPF shift inwards because of the recession?
Will the UK economy’s PPF shift inwards because of the recession?
This is an interesting question and hints that a deep recession that lasts longer than we expect can have a damaging effect on the UK economy’s supply-side performance and productive potential.
read more...»Darling’s Tough Love
Alister Darling’s interview in the Times today was revealing on several different levels. First for confirming that the Treasury is actively looking at altering the government’s own fiscal rules in time for the Pre-Budget statement in November. Second that Darling did not appreciate the extent of the negative fall-out on the real economy from the credit crunch - a crunch which has now reached Crunch 2.0 as it moves from the financial sector to manufacturing and services. And third that, given the parlous state of the government’s own finances - this year will be a particularly difficult one and tough choices will have to be made on spending priorities
”“So every chancellor has to be conscious of the fact that there’s a balance to be struck between how much you can spend, and how much people will say, ‘OK, if you’ve another pound to spend, remember me as well.”
A classic example of opportunity cost to use when the new term starts in September.
The dreadful public borrowing figures are reported here: public borrowing surges
