Get Summer 2014 Right First Time with tutor2u Exam Coaching & Revision Workshops
It was an industrial dispute that reshaped not just the British coal industry but also many other sectors. In 1984 a national strike broke out pitting Arthur Scargill against Margaret Thatcher. Channel 4 news looks back at the 30th anniversary of the start of a year-long bitter battle whose scars are still apparent.read more...»
In this memorable Newsnight interview, Jeremy Paxman quizzes / interrogates a senior Coca Cola executive about the amount of sugar in Coca Cola drinks. Coca Cola wants to "make sure that the information is available" but if they did would students, cinema goers and millions of other consumers change their preferences?read more...»
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
This blog brings together some of our resources on information failures in markets.
Click below for:
Mo Tanweer's superb revision notes on aspects of information economics
Try our short Zondle revision quiz on information failureread more...»
Boris Johnson, The Mayor of London, has been happy to extend the use of bicycles in London; and the pattern of use has thrown up some interesting points. There were 7.4 million cycle hire trips last year but an estimated 71% of cycling use was by men. Most of these journeys would have been made on foot (31%) or by public transport (47%). Coverage of the study published in the BMJ looked at the health effects is found here.. The notes in the article, provide good examples of the strengths and weaknesses of cost benefit analysis.read more...»
According to a report published by the Parliamentary Public Accounts Committee, the Government are currently underestimating how many students will actually pay back their university loans over the coming decades. Currently, the Government estimates that between 35 and 40% of loans to Higher Education students are never paid back - the Committee believes that the rate on non-repayment is much higher and reflects a weakness in the loan collection method. The primary reason for non-repayment is that student details get lost over a period of time particularly if the graduate moves and works abroad or was an EU citizen who has returned to their own country. The method of using the income tax registration process as a way of locating former students has been criticized for not being an effective method of collecting information. It is estimated that the shortfall could be as much as £80 million by 2042.read more...»
A great case study on the BBC about what has been driving up the price of almonds. Plenty of topics to explore in here: agricultural supply, determinants of demand, derived demand (almond milk), monopoly power, capital intensive production and maybe more.
This will be an excellent case study to use when you're discussing the issues around minimum prices to solve the problem of externalities.read more...»
If you attended the recent tutor2u revision conferences for up-coming micro-economic exams (look out for the macro workshops and combined micro and macro to come in March) you will have seen how fuel-pricing was used as an example of market failure, government intervention strategies and government failure.
Fortunately, the energy market is a gift that keeps giving to us in the economics world (every cloud has a silver lining) as a report out today (see this link for the BBC version of the story) indicates that Parliament is about to intervene to try and stop the energy companies charging more to customers who pay by cash rather than by direct debit (£114 per year, according to the report).read more...»
Here are ten revision questions covering income elasticity and cross price elasticity of demandread more...»
Here are ten multiple choice revision questions covering the topic market demand and market supplyread more...»
Here are ten questions for students wanting to check their understanding on markets in actionread more...»
It was announced yesterday that the Government is planning to abandon its use of expensive software such as Microsoft Office (see article in the Guardian here) partly as a way of reducing costs but also as a means of breaking some of the software company's 'oligopolistic' stranglehold on the market.
As well as offering an example of Government policy to combat market failure, this story gives us a little insight into the issue of contestability in the software industry.read more...»
Here is a short video on the challenges and opportunities facing cocoa producers across the world but especially in sub Saharan Africa which accounts for 70% of global production. Supply is struggling to keep pace with rising world demand and there have been some structural declines in production in several countries.
The FT's Emiko Terazono reports from Ghana on how chocolate manufacturers and traders are striving to boost cocoa supplies, which are coming under pressure from climate change and urbanisation amid growing demand for confectionery in emerging markets. Farmers are being encouraged to develop supplementary incomes and invest in sustainable production methods.read more...»
Here are ten questions for students wanting to check their understanding on government intervention in marketsread more...»
Saudi Arabia’s position as one of the largest players in the global oil market, producing more than a tenth of the world’s output and owning a quarter of the world’s proven reserves, has negative effects on other market participants. Writing in the Economic Journal, Anton Nakov and Galo Nuño document two features that have made the Kingdom different from other oil producers:read more...»
Proposing Government intervention strategies for dealing with externality market failure is a common enough exam question. Many of my students will concentrate on the use of indirect taxation, subsidies, pollution permits or regulation as a method of reducing consumption - often forgetting that the Government can use good, old-fashioned advice as a way of altering purchasing patterns.read more...»
Do consumers of carbonated soft drinks really know how much sugar is in their regular fix? This five minute Newsnight clip is ideal for showing when teaching aspects of the economics of information failure. Will "getting the information in people's hands" help them to adjust their lifestyles? What are the economic arguments for and against direct intervention in the market for carbonated drinks such as a tax on high sugar content products? What are the alternative options or should we simply let consumers make their own choices?read more...»
Most first year Economics students consider government intervention and government failure as key topics in their introductory microeconomics course. Finding compelling examples of state blunders is not that difficult but understanding how the complexity of the government apparatus lies behind failures of project and policy requires digging deeper.read more...»
The dates and locations for our popular exam technique coaching & revision workshops to prepare AS & A2 Economics students for exams in May & June 2014. The details are listed below together with important information about changes in way that bookings are processed.
Please note that for summer 2014 we are taking confirmed bookings only. Places are allocated on a strictly first-confirmed basis. Once each screen capacity is filled, the event is full and no further bookings can be accepted. Our overall capacity is lower than in previous years and we fully expect each workshop to be fully booked before the Christmas break - so please contact us early to ensure that your students can attend!read more...»
You may have seen news reports today about the Competition Commission announcing that it will continue its investigation into the car insurance market having decided that there are concerns to be addressed. The headlines concentrate on the market failure caused by the current system of non-fault claimants organising their own replacement vehicles (and then charging the at-fault insurers) but I thought it was just as interesting that the CC are looking at the relationship between the insurers and price comparison websites.read more...»
With London’s Victorian sewage system struggling to cope, the 25km Thames Tideway tunnel is intended to boost capacity. But the £4.2bn Super Sewer project has run into considerable and vocal opposition. London's main sewers are over 150 years old and built for a city for 2.5 million people. The population of London is now over 8 million and when heavy rainfall arrives, there are frequent and sizeable discharges of raw sewage into the river Thames. 39 million tonnes of untreated sewage flushes into the Thames in a typical year - that’s enough to fill the Royal Albert Hall 450 times. The sewage discharges puts the UK in breach of the EU Urban Wastewater Treatment Directive.
Critics of Thames Water argue that they have under spent on sewage system maintenance over the years despite recording persistently high profits. Thames Water announced £150 million profits in 2012.
Residents around the 21 proposed construction sites have protested about the externalities connected to the project. Other opponents argue that the money would be better spent on cheaper sustainable urban drainage techniques.
Future generations will benefit but today's water users will pay most of the construction cost with higher water bills imminent for a number of years to come. The Thames Water proposes adding £70 to £80 a year indefinitely to the average bill of Londoners to fund the 16-mile sewer from Acton in west London to Abbey Mills in east London. But a report by Bloomberg New Energy Finance calculates that the tunnel could be built for between £30 and £35 per household per yearread more...»
A streamed presentation on aspects of the price mechanism with links to three revision quizzesread more...»
Here is an updated revision glossary covering key terms on markets and government interventionread more...»
The cost of renting property in many parts of the UK continues to rise - would rent controls make any difference? Here is an updated Unit 1 economics revision presentation.read more...»
The Tutor2u slideshare channel has just notched up over a million hits and we continue to add new resources each week. Here is the link to the site.
Tim Harford explores the frustrations of using lifts. How much economics can you find in this BBC Newsnight report from November 2013?read more...»
Here is a revision presentation on the economics of producer and consumer subsidies as forms of government intervention in markets. There are a number of up to date examples highlighted together with an evaluation of the benefits and costs of subsidy payments. This is designed as a revision aid for unit 1 students taking their microeconomics papers.read more...»
"The market will define our future" - the words of an organic farmer growing produce in Mexico City's water farms and which - according to this excellent video report from the Financial Times - have the potential to feed huge numbers of people living in the metropolis. Careful husbandry of the canals and surrounding farm land creates the opportunity for farmers to complete between seven and nine harvests a year, an interesting link to the concept of price elasticity of supply. The video reinforces the importance of human capital - detailed, specific knowledge of the growing conditions and calendar of crops that is handed down from one generation to another.read more...»
Here is an example of direct intervention in markets to address some of the information failures associated with the obesity epidemic. US food authorities have taken the first step towards banning artificial transfats, substances that are found in processed foods. They say it is a move that could prevent 20,000 heart attacks and 7,000 deaths a year. According to the BBC website
"Artificial trans fats are used both in processed food and in restaurants as a way to improve the shelf life or flavour of foods. The fats are created when hydrogen is added to vegetable oil, making it a solid."read more...»
Do consumer choice and competition between suppliers improve the quality of outcomes for consumers? The answer might seem so obvious that it is hardly worth asking. But a powerful strand of political opinion is building up to an attack on the concept.read more...»
We are delighted to host on our blog this article from Alex Macarthur an upper-sixth student at Altrincham Grammar School for Boys. Alex enjoys is especially interested in ‘Behavioural Economics’. In this feature he looks at pricing anchoring in markets. This article was originally published in the student magazine www.lucigmag.co.ukread more...»
Here is an updated revision presentation covering price volatility in commodity markets and the economics of buffer stock "price stabilisation" schemes. designed for unit 1 micro courseread more...»
The FT video clip below provides a short interview with Dame Ellen MacArthur - the former ocean yachtswoman - and her idea of building a circular economy - this idea might be a fruitful area for student exploration when studying environmental economics. To quote from the web site:L
"The linear ‘take, make, dispose’ model relies on large quantities of easily accessible resources and energy, and as such is increasingly unfit for the reality in which it operates. Working towards efficiency—a reduction of resources and fossil energy consumed per unit of manufacturing output—will not alter the finite nature of their stocks but can only delay the inevitable. A change of the entire operating system seems necessary"read more...»
An autumnal hat tip to Jonathan Portes, Director of the National Institute of Economic and Social Research for spotting this textbook example culled from the Daily Mail of the problem of social cost and how application of the Coase theorem might be a solution! Click here for the article.
If you would like to know more about the Coase Theorem and the work of Ronald Coase who died earlier in 2013 at the ripe old age of 102 then click here for a superb blog entry from Mo Tanweer.
Energy prices are in the news. The recent actions of some of the energy companies can plausibly be described as provocative, no matter how well founded their decisions might be. They run the risk of provoking the ire of both the Opposition and the Government.
One interesting aspect of the debate is that it has become even clearer that decisions taken by Ed Miliband himself in the Brown government are partly to blame for our high energy bills. The plethora of green taxes and subsidies has become very expensive for consumers.
But how effective have such policies been? Not very much, seems to be the answer.read more...»
Where would you expect a Starbucks latte to be cheaper - in a coffee store in downtown New York or in a Starbucks store in China? Keep in mind that per capita incomes in China are around one tenth of those in the United States.
The answer may come as something of a surprise!
In a report on coffee prices that has caused something of a stir across social media platforms, the state-owned broadcaster CCTV reported that a medium-sized latte cost Rmb27 ($4.43) in China compared with Rmb19.98 in Chicago, Rmb14.6 in Mumbai and Rmb24.25 in London.
Starbucks responded that its pricing strategy was based on local market costs, including infrastructure investment, real estate and labour costs. It also added that its Asia-Pacific profit margin was for 14 countries, not just China. They added that each Starbucks market is unique and has different operating costs and that it would be inaccurate to draw conclusions about one market based on the prices in a different market.
The prices of imported goods in China are often raised because of the effects of import taxes (tariffs) - in this case the customs duty on roasted coffee beans is 15%. Add to that a sales tax of 17%.read more...»
After more than a year of relatively low prices, rising global demand for cocoa is a key factor behind a surge in the international price of cocoa beans, prompting fears that the traditional consumer splurge on chocolate treats during the Festive season will be noticeably more expensive this year! In this short BBC news video, some of the background to the rise in cocoa prices is explored. You can download the cocoa price chart below.read more...»
Air pollution is widely regarded as a negative externality arising from consumption and production. New research from the World Health Organisation finds that exposure to air pollution increases the risk of cancer - this 2 minute news report looks at their findings. You can find extensive revision notes on externalities and market failure by clicking this link.read more...»
The Guardian technology blog has given a less than glowing review of the recently launched Argos MyTablet computer - read Argos MyTablet review: cheap, nasty and frustrating to use - the price point says it all - £99 for a low entry level tablet supplied under the Bush brand name and marketed at younger members of the family. Surely this is another product to add to teaching examples of inferior goods? The discount tablet market is being fought over by major high street retailers - Tesco is selling the Hudl and now Argos has joined the battle. I'll be staying well away from this!read more...»
This is a cross-posting from the Business blog (written by Penny Brooks)
"The 20th Century was about dozens of markets of millions of consumers. The 21st Century is about millions of markets of dozens of consumers."
So said Joe Kraus, founder of a search engine called Excite in the middle of the 1990s. Never heard of it? That's not surprising; in 1999 it was a $6.7bn enterprise with hundreds of employees, but a year later the dot-com bubble burst and it disappeared from the market place. But this quote is one of in an article about Peter Day's Radio 4 Archive programme to be broadcast tonight, and already recommended by Michael Owen in his blog below; forgive me for this repetition, but this is such a brilliant article that it really merits a second look, and hopefully between us we will convince you of that!read more...»
Inequality has been rising for 30 years. The gap between rich and poor is the widest since the second world war. If current trends continue, we will have reached Victorian levels of inequality in 20 yearsread more...»
The cost of living will be a key battleground in the next election and the main political parties seem to be coming up with offers covering utility bills, rail fares, banking charges and the cost of housing as a way of limiting increases in the living costs of "hard-working" families! One should always take promises from politicians with a huge pinch of salt - intervention to freeze bills is fraught with risks and unintended consequences. This Channel 4 news clip looks at the issue.read more...»
Here is a familiar tale - sharply falling world coffee prices are causing the terms of trade to drop and threatening the commercial viability of coffee production among many of Indonesia's small scale coffee farmers. Can stronger marketing and investment in processing help these farmers move up the value chain?
The price of coffee in Indonesia has dropped to a third of the price from one year ago, due to an oversupply of it in the world's market. This has caused many coffee farmers in Indonesia to stop growing coffee and switch to other plants, such as oranges.read more...»
Ed Milliband’s conference speech last week gave us one of those all-too-rare moments where we can illustrate a real (or potential) government policy with a standard economic diagram.
Mr Milliband clearly stated that, should the Labour Party win the next General Election (in 2015) they will cap the price of domestic fuel. His policy is aimed at restricting how much people would have to spend on energy so as to improve their general purchasing power as well as reducing business costs. The big losers would be the energy companies themselves who do not seem particularly keen on the policy. Mr Milliband argued that their profits were sufficiently high and, besides, they have been using the lack of competition within the market place to bolster their coffers.
Assuming that teachers have already covered the basics in Demand and Supply diagrams, this link will take you to a short (up to 10 minute) activity asking students to draw the ‘Price-Cap’ diagram and consider the economic arguments for and against the policy proposal.
AS economics student Ed Hardy offers his interpretation of this question: “Within a few years the common problems we associate with scarcity will be a thing of the past.” Do you agree?read more...»
There are lots of resources out there for students and teachers wanting to cover the debate about HS2 - here is a brief selection of video clips on the debateread more...»
Since the appalling fire a few months back at the Rana Plaza complex that cost the lives of more than 1100 people, there has been intense interest and scrutiny of working and living conditions of thousands employed in Bangladeshi clothing factories.
On Monday night the BBC programme Panorama broadcast an investigation into this and the findings were compelling and deeply disturbing.
In "Dying for a Bargain" Panorama discovered there have been at least 50 fires in Bangladeshi clothing factories in the last 10 months. Clothing factory workers filmed by
#BBCPanorama were released at 2:30 am, 19 hours after they started. They were due back at 7am. You can see a clip of this here. Events uncovered at the Ha Meem Sportswear factory will no doubt have left executives at Lidl scrambling to find out the truth about what is happening at one of their major clothing suppliers.
Tesco launches an own-brand seven inch tablet with the forgettable name Hudl - how will it be received by Tesco customers and the wider constituency of people looking for an affordable device? My first instinct is to add this product to my list of inferior products! Tesco says that it is every bit as good as the competition and you can get it in four different colours - what do you think?read more...»
Thousands of students have been helped by the online videos on economics concepts produced and presented by Phil Holden. The good news is that he is back and delivering two new lectures each week. They are ideal for supporting your work in school and nailing the new concepts and relationships as the AS course progresses. Here are some of the early video pieces.read more...»