Unit 4 Macro: Time to Re-Boot the British Economy
This special blog in the Guardian from Professor Danny Quah of the London School of Economics is superb for Unit 4 students taking their papers in June 2012. in “The UK and the eurozone in the shifting global economy” Professor Quah focuses on many of the underlying difficulties in the UK economy. Digging deeper inside the trade data he finds that, focusing on the UK’s 50 largest trading partners in 2009: 56% of our exports go to the 10 slowest-growing economies in that group. We are missing many opportunities to fully embrace trade and investment with faster-growth countries notably in Africa and Asia.
A note for your diaries if you are within reach of London on Monday 23rd January. Martin Wolf from the FT is speaking on The State of the Global Economy in 2012 - an event not to be missed for fans of his writing and insight. He is speaking along with Jean Michel Severino, nspector general at the French Ministry of Finance. Here are the details.
Unit 4 Macro: Economics of Fiscal Deficit Reduction
How far, how fast and in what way should the UK government seek to cut the annual budget deficit and improve the state of public sector finances? These questions continue to be at the centre of a fierce debate among economists.
read more...»Unit 4 Macro: Competitive Advantage in Trade (Some Videos)
Here is a selection of short video clips that I use when teaching competitive advantage in markets and when introducing the factors that determine the competitiveness of UK producers in global markets. The focus here is on the UK economy but I will add some more videos to the blog as I work my way through this teaching topic.
read more...»Unit 4 Macro: UK Bond Yields Reach Record Lows
The yields on UK government issued bonds has been falling steadily in recent months and, as we turned into January 2012, the yield on ten year government debt edged below 2% - when the UK government continues to borrow eye-wateringly large sums, why are bond yields so low?
The yield on a bond is the income received from a fixed-interest bond, calculated as a percentage of the price paid for it. So a ten year bond bought for £10,000 and paying a fixed annual interest of £600 would offer a yield of £600 / £10,000 = 6.0% per annum.
If the market price of a bond rises - for example, it rises from £10,000 to £12,000, the fixed interest remains the same (£600) but the yield will fall. £600 / £12,000 expressed as a percentage = 5%.
read more...»Unit 4 Macro: UK Trade Patterns
The Guardian DataBlog has a superb resource here on the patterns of UK exports and imports in 2011. Ideal for printing out and using when introducing international trade. There is more official UK trade data here
Revision Presentation: Economics Evaluation Skills
Here is a short revision presentation on evaluation skills for AS and A2 economics questions which we produced a couple of years ago which might still be useful for the forthcoming exams.
read more...»Unit 4 Macro: Does Manufacturing Matter?
Vicky Pryce FRSA has a new article on the economic significance of manufacturing industry for UK economic renewal. It is available here from the January 2012 edition of the RSA Journal. In a related article Sir Christopher Frayling FRSA discusses the rise of the Maker Movement.
Back in November 2011 Channel 4 news ran a special on the future for UK manufacturing here is a link to a related video
Unit 4 Macro: Natural Disasters and their Economic Impact
From tsunamis to tornadoes, from droughts to floods, 2011 was a particularly nasty year for natural disasters in many parts of the world. These natural disasters inevitably have demand and supply side effects affecting not just those countries affected but ripple impact across regions and in the broader global economy.
The Al Jazeera news video report below provides a clear overview of some of the major natural climatic shocks of 2011 and could easily be used as an introductory resource to discuss what are some of the micro and macroeconomic effects in both the short and medium term.
These include:
* Effects on the stock of physical capital / infrastructure
* Impact on a country’s human capital
* Effects on commodity prices, export revenues
* Effects on agricultural output, profits, investment, productivity
* Ripple effects on manufacturing industries and energy supply/cost
* Impact on state tax revenues and the costs of re-building and providing emergency financial support
* Effect on the movement of population following extreme climatic events
* Natural disasters and changes in the distribution of income / risk of poverty
This Economist graphic (published in Jan 2012) looks at the human cost of natural disasters and claims that “the world has succeeded in making natural disasters less deadly.”
read more...»AS and A2 Economics - 10 Ways to Improve Evaluation
As students build their revision efforts ahead of the impending A Level Economics units, here is an updated version of my revision document on evaluation skills for AS and A2 economists…
read more...»Unit 4 Macro: Video Resources on Unemployment
This blog entry brings together a selection of recent news reports and videos covering the economics of unemployment in the UK and inother countries.
read more...»Unit 4 Macro: Exchange Rate Economics - Where next for the US Dollar?
Is the US dollar going to be knocked off its perch as the only true global currency? Professor Barry Eichengreen, the author of Exhorbitant Privelege argues that there are strong reasons to believe that the US dollars’ position in the world financial system will decline in the years ahead.
The US dollar has been for many years the world’s most powerful currencies but this power seems to be waning as other currencies rise in significance and the US economy struggles to recover from their financial and economic crisis and the fiscal challenge. Eichengreen argues that there will be three truly global currencies going forward - the dollar, the Euro and the remnimbi.
read more...»Unit 4 Macro: Development Issues: The Baby Boom in Zambia
In this special report from BBC reporter Fergus Walsh, the rapid population growth in the African country of Zambia is examined. Population growth in the country is so quick that it could perpetuate deep poverty in the country despite relatively fast growth in recent years. In Zambia, the UN predicts that the population could triple by 2050, reaching 100 million by the end of the century.
Resources on Keynes and Hayek
In this blog we are putting together a suite of web-based resources on the clash between supporters of Keynes and Hayek, a debate that have gathered momentum in recent times largely in the wake of the global financial crisis.
read more...»2011 in Review - The US Economy
2011 for the US economy was a year of slow growth and fears of a double-dip recession, but there were some more positive signs as 2011 came to a close.
Can the world’s biggest economy sustain a more durable upturn in activity during 2012? Keep in mind that this coming year will be dominated by the lead-in to the November Presidential election.
read more...»Review of the Year in Economics - Guardian
Larry Elliott from the Guardian provides this excellent overview of key developments in the UK and world economy in 2011.
Unit 4 Macro: Human Capital and Economic Growth
In A2 macroeconomics the underlying causes of economic growth and development and constraints on both of these are covered in more depth. One of the concepts students might be familiar with is that of human capital.
I have always summarised the idea of human capital as being a measure of the overall quality of the human input available to produce goods and services in an economy. The ONS have published a new study on the value of human capital in the UK and they draw on a definition given by the OECD
read more...»The Eurozone Crisis Explained (again!)
A superb, relatively simple, explanation of the Eurozone debt crisis with good data on historical compliance to the ‘Stability and Growth Pact’. Plenty data for students to get their teeth into. How significant is the level of government debt?
Unit 4 Macro: Prospects for the African Economy
In recent times there have been several new reports focusing on growth and development prospects for the African continent. Contained within them is plenty of useful background analysis and comment for students and teachers who spend time looking at developments and issues affecting Africa as part of their economics studies. Follow the links below for more details:
read more...»Economic Corruption - Global Rankings for 2011
The scale and depth of corruption - defined by Transparency International as the abuse of entrusted power for private gain varies greatly across the world. No country can ever score a perfect score for eliminating corruption from their economy but the annual rankings of perceived corruption provide a useful way of identifying the best and the worst performers (most of whom are plagued by extreme poverty, war and failed government). Systemic corruption damages human lives and can undermine almost everything that international organisations seek to do to promote development and poverty reduction.
Several countries have made sizeable progress in tackling and reducing endemic corruption and are thus better placed to attract sustainable inward investment as part of their development strategies.
Here is a link to a video on the Economic Corruption rankings for 2011 produced by Transparency International
read more...»Prospects for the UK Economy in 2012 - PowerPoint download
Geoff has kindly made available for download his presentation made to students at Dulwich College recently in which he analyses the prospects for the UK Economy in 2012. A Slideshare-streamed version is also provided below.
read more...»Millennium Development Goals - Uneven Progress
This blog brings together some recent videos on progress made towards meeting some of the Millennium Development Goals (MDGs).
The Millennium Development Goals include ambitious targets to
o Eradicate extreme poverty and hunger
o Achieve universal primary education
o Promote gender equality and empower women
o Reduce child mortality and improve maternal health
o Combat HIV/AIDS, malaria and other diseases
o Ensure environmental sustainability and develop a global partnership for development
Unit 4 Macro: The Rise in Self Employment
One feature of the jobs market data in the UK in the last couple of years has been the surge in measured levels of self-employment (the data is collected as part of the huge Labour Force Survey)
The total number of self-employed people in the UK increased by 166,000 in the three months to the end of November to reach 4.14 million - this is the highest number of self-employed people since comparable records began in 1992.
What helps to explain the growth of self employment? Optimists might claim that it is a sign of a pick up in entrepreneurial activity in Britain as many people who have been made redundant decide to strike out on their own by starting a new business.
A more realistic explanation is that rising self employment is a sign of macroeconomic weakness. Hundreds of thousands of people have lost their jobs and a sizeable number will simply re-categorise themselves as self employed when they are quizzed as part of the Labour Force Survey. They are likely to be scouting around for jobs and are much likely to take one or more part time jobs when they can.
Part time employment was up sharply, but do not forget that the number of full-time employees fell by 188,000 in the three-month period covering August, September and October - that is more than 2,000 people per day losing their jobs.
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Great Economics Blog to Follow - Danny Quah
Professor Danny Quah from the London School of Economics has a superb blog and I recommend it heartily to economics teachers and students. It is particularly excellent for understanding developments in the global economy, not least Danny’s work in plotting the changing centre of gravity in the world economy over the long term. Here is the link to use.
The LSE Public Events team has just released their programme for the New Year, there are plenty of really interesting talks coming up and you can access the Spring 2012 Events Programme by clicking on this link
Unit 4 Macro: India - the Road Ahead
Here is a short 12 minute video on prospects for the India economy produced by economists at the International Monetary Fund. It covers some of the key current issues including high inflation in a supply-constrained economy, partial progress in reducing poverty and the impact that poor infrastructure has as a constraint on further growth and development. Click on the video link below
read more...»Unit 4 Macro: Celebrating (?) Ten Years of Euro Notes and Coins
The European Central Bank has just released a special six minute video celebrating the first ten years of the euro banknotes and coins! The new head of the ECB makes an appearance but does the video give enough time and emphasis to the structural problems and fault-lines of the system? And will the video become an interesting historical relic before we elect to use it in the classroom? Anyway…..here is the link
read more...»Unit 4 Macro: Does UK Manufacturing have a Future?
Here are links to two superb short reports on prospects for UK manufacturing as the British economy struggles to escape from recession and sluggish growth forecasts in 2011 and 2012. Both are from Channel 4 News that produced a special on the health of the manufacturing sector - excellent for evaluation and for some applied examples to build into essays. The links appear below
read more...»Where is the UK Economy? National Output
The first of an occasional series - putting economic data into context. First we focus on the level of real national output in the UK in the aftermath of the recession and with recovery appearently grinding to a halt.
UK GDP remains well below the peak of national output at the end of the last cycle in the early months of 2008. During the recession, national output fell by a cumulative 7 per cent. Since then there has been a slow and uncertain recovery and the Bank of England has recently slashed their growth forecasts for the remainder of 2011 and for 2012. Growth of less than 1 per cent will cause unemployment to rise and will damage business and consumer confidence (animal spirits) and further undermine planned capital investment spending.
There is a real danger than UK trend economic growth (the estimated annual growth of potential GDP) will continue to edge lower affecting living standards and any chance of the government meeting its medium term deficit reduction targets.
Bank of England: Bank of England finds risk of crisis biggest since 2008
Jim O’Neill - The Growth Map: Economic Opportunity in the BRICs and Beyond
Jim O’Neill the Chairman of Goldman Sachs Asset Management has a new book published early next week and it looks like being a tremendous resource for teachers and students wanting to deepen their understanding of crucial changes in the global economy. The Telegraph has been publishing extracts from the book - to have a view please click on the links below:
read more...»Stephen King - Great Article on Macroeconomics
Stephen’s piece in the Independent on Monday would make for a terrific Unit 4 discussion with your A2 students. Here is the link to follow Ten things people thought they knew about economics
You can follow all of Stephen King’s recent economics articles in The Independent by clicking here
UK unemployment in November 2011 - a video overview
The presentational style might leave a little to be desired, but this analytical ONS video might provide colleagues with a different teaching resource to help explain the rapid rise in UK unemployment.
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