Unit 4 Macro: Indonesia’s infrastructure deficit
Here is a video report from the fast-growing country of Indonesia where infrastructure deficiencies threaten their sustainable growth rate.
read more...»UK Economy: Has High Inflation Damaged the Economy?
What are the costs of a higher average rate of inflation? With CPI inflation staying persistently above target over much of the last six years, to what extent has this undermined UK macro performance? Or has a little extra inflation and an ultra-loose monetary policy (0.5% base rates and £375bn of quantitative easing) been a price worth paying to avoid an ever deeper recession and depression?
"The high retail price inflation seen in recent years has outpaced earnings and eaten into household spending power. Ongoing relatively high inflation will continue to impact consumer spending, especially with unemployment unlikely to fall quickly. The effect on consumer spending will vary between different demographic groups and product sectors, causing companies to revisit their offerings."
Here is the link to the Ernst and Young report - click here
UK membership of the EU - a chance for students to make Nigel Farage laugh or cry
The UK's membership of the EU is among the hottest of topics at the moment. With the UKIP party doing so well in recent elections and various senior political figures starting to show their real views on UK membership of the EU club even Barrack Obama was giving his opinions yesterday. This doesn't mean that the topic is any more likely to turn up on macro-economic exam papers over the next few weeks at AS and A2 (the OCR AS paper has already been and gone! Hope it went well) - the papers will have been written before the more recent votes.
However, the economic question about the UK's membership has been an important topic for quite a while and so it is worth having a look again just in case it rears its multi-lingual head. Added to that, students of economics will be in an ideal situation over the next few years to be able to make an informed decision in any referendum, based upon having some of the facts and figures and having developed their outstanding evaluative skills on the matter!
With this in mind, follow this link to find a short (10 minute) teaching resource that asks that very simple question - What are the economic arguments for and against remaining in the European Union? The Powerpoint file has a 4 minute timer to give students the chance to think about the answer and then a nice little graphic illustrating some possible answers that they could use in an exam. The BBC have also produced a succinct balanced webpage on a similar question.
Unit 2 Macro: Does High Home Ownership Cause Unemployment?
For many years Professor Andrew Oswald has researched the links between home ownership levels and labour market performance. This new paper with Professor David Blanchflower takes the debate forward - they argue that rising home ownership can bring about negative externalities for the rest of the economy, damaging labour mobility and curtailing new business start-ups. It is an argument worth looking at when we discover some of the structural causes of joblessness. Read the article here
See also: It's not the deficit that will haunt our children: it's unemployment (Heather Stewart, The Observer, May 2013)
See also: Forget inflation – what hurts the most is unemployment (David Blanchflower, Independent, April 2013)
UK Economy Revision - Downloadable Revision Sheet
Here is a link to a downloadable revision handout on key UK economic data designed for AS and A2 macro papers this summer. I hope it might be useful for some students and teachers.
read more...»Does it matter if we are in a recession?
Those of you who avidly follow Geoff Riley's blogs on this website may have read that he advises students to avoid getting too worked up about whether the economy is actually in recession.
Most economic students will readily tell you the official definition of a recession and can analyse the impact of an under-performing economy. However, it was interesting to read today that, having officially avoided a triple-dip recession last month we may have to revise whether we actually sank in to a double-dip recession in the first place. Follow this link to read the Telegraph's report on how the ONS are revising recent statistics on the economy's performance, suggesting that the shrink in the construction industry shrank by 5.0% (not 5.4% as originally reported) in the first three months of 2012 and, as a consequence, the UK did not slip into another recession.
As Geoff would tell you, whether the country was in a recession or not is the not the most important factor - the economy's sluggish growth should be the paramount concern and the word 'recession' has become more of a political tool. In the upcoming exams, students should remember that the avoidance of a double-dip or triple-dip is fairly irrelevant - the overall performance is the key indicator and there is still plenty to be worried about.
The exams are nearly here - as if you need reminding! Well, here’s a reminder!
Here's a very simple, but totally unsubtle reminder for your students on the upcoming dates and times of the AS and A level exams in Economics for the AQA, Edexcel and OCR awarding bodies.
Follow this link to download the 'Exam Countdown' file. There you will find a small and easy to use Powerpoint file called 'Exam Countdown'.
Follow this link for a quick tutorial on how to use the resource.
Open and run the slideshow (ensuring that you have 'enabled macros'). The screen will change to a setup slide after a couple of seconds. Click on the exam that you wish to remind your student about and the countdown timer will start. The timer shows how many days, hours, minutes and seconds remain before their exam starts. There's nothing like instilling a sense of urgency!
Please note this file is fully functional. If you would like an editable version (where you can edit the times, dates and 'event') you will find one as part of the 'Super Teacher Utility Belt' resource available from our PowerPoint games-based learning site.
UK Economy Revision - Policies to Reduce Unemployment
Here is a streamed (and downloadable) presentation on policies to cut unemployment in the UK economy.
read more...»AS Macro revision - The Codecracker
Here's a short activity that can be used to add something a little different to your upcoming revision sessions for AS Macro topics. The Codecracker file (downloaded by clicking on this link) can be used either in class or given to your students as an exercise at home.
The file has 8 multi-choice questions on a variety of topics from the AS macro syllabus. Students have to get all 8 right (collecting letters along the way) to get the correct code. If they get even one answer wrong then the code will not be cracked (and they have to start again!). This may last 5 minutes or 50 minutes!
This is stand-alone Powerpoint file called a '.pps' file which means that it will open up automatically without having to open Powerpoint first (and you don't need Powerpoint on your PC). You can pass the file to your students using your preferred method (e.g. email) and they can see if they can crack the code in their own time.
PS. An editable version of this resource will soon be available from this website.
Unit 4 Macro: Credit Constraints and the Economic Recovery
The credit crunch is widely regarded to have started during 2007 and is certainly not over yet! Indeed the period of severe constraints on credit availability and rising borrowing costs most notably for smaller businesses has now lasted longer than the Second World War. It represents a major barrier to sustained and hopefully more robust economic recovery. This short streamed presentation looks at the importance of the credit squeeze on the UK economy.
A number of new government policy initiatives have been introduced but doubts persist about their effectiveness. Underneath the surface new forms of business finance are taking shape including peer to peer lending and the rise of retail bonds issued by a number of businesses.
read more...»AS and A2 Key Term Glossaries
Brought together in one blog resource - click below for details
Paul Ormerod: The Reinhardt and Rogoff miscalculation
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.
The UK Peace Index - highlighting the opportunity cost of violent crime
I'm always sightly dubious about statistics and information represented by campaign organisations - I'm left with the reservation that information can presented in any way that you want to prove whatever point that you are trying to make (wasn't it an economist who came up with the phrase 'lies, damned lies and statistics'?). So this fascinating report from an organisation called 'Vision of Humanity' needs to be looked at with an open mind.
However, if you take it at face value, it offers some really interesting information.
read more...»AS, A2 & IB Economics Revision Quizzes - Master Listing
[updated 22 April 2013]
Our Economics team have been busy over the last few weeks authoring a comprehensive new collection of multiple-choice revision questions designed to support AS, A2 and IB Economics students.
Over the next couple of weeks, we'll be uploading these quizzes to the tutor2u website and also creating Zondle versions to enable them to played using the tutor2u mobile and tablet App.
Please bookmark and share the link to this blog entry and visit regularly to check on our progress as we add new revision quizzes.
read more...»Unit 2 Macro: Making Sense of the Data
This is an excellent resource for Unit 2 students. The BBC's Hugh Pym interviews some city economists about what is happening to many of the key macro economic indicators
read more...»The Angry Economist 2 - The George Osborne Edition (evaluating macroeconomic policies)
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.
Paul Ormerod: Whatever happened to all those miners? Shocks and economic resilience
Where have all the miners gone? To judge by the rhetoric of the BBC and other Leftist media outlets, whole swathes of Britain lie devastated, plagued by rickets, unemployment and endemic poverty – nearly thirty years after the pit closures under Lady Thatcher!
The reality is different. There is indeed a small number of local authority areas where employment has never really recovered from the closures in the 1980s. But, equally, there are former mining areas which have prospered.
read more...»
Scoop it Boards for Economics
A growing number of teachers are curating Scoop It Boards focusing on specific exam courses or aspects of the subject - ranging from ones on market failure and government intervention through to international economics, China, and relevant articles and resources for papers such as OCR F585 and Pre U. Maybe students can be encouraged to curate and develop their own boards as a way of keeping a study log of interesting blogs, news features, analysis and evaluative pieces?
read more...»Revision Quiz: AS Economics: Managing the Economy (1)
This 10 question quiz looks at the broad topic of macroeconomic management of the economy.
Launch Revision Quiz: AS Economics: Managing the Economy (1)
Unit 2 and Unit 4 Macro: Economic Simulation - the Government Game
Introducing The Government Game - tutor2u's new Economic Simulation game that is just perfect for revising for AS & A2 Macroeconomic Policy topics!
Unit 2 Macro: UK and US Growth Compared
In this short Financial Times video, Vicky Redwood the Chief UK Economist of Capital Economics looks at why economic recovery in the UK has been slower than in the USA since the end of the last recession.
read more...»Paul Ormerod: Sovereign debt and Euro zone reality
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...»Unit 4 Macro: From Domestic Product to Domestic Progress
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...»Economics Revision - Mind Map and Visual Notes Competition
There are thousands of AS and A2 students out there at the moment putting in some serious hours of revision ahead of the May and June papers. Effective revision is more of an art than a precise science but many students are producing some superb mind-maps, revision flash cards and other visual resources to telling effect.
We like to showcase some of them at this stage of the year. In the spirit of friendly competition, we will offer some book prizes to our favourite mind maps and similar revision notes. You can email them through to us (ideally one image per mind map, 800 x 600 size works best for us but we can resize any image). Or post them on twitter and add @tutor2u or @tutor2u_econ to your tweet so that we can see them!
We will announce the winners on the 1st of May! Check below to see some of the early entries. This blog will be updated on a regular basis.
read more...»Unit 2 and Unit 4 Macro: Unicef Child Well-Being Report 2013
Unicef have just released their latest 'report card' on the relative state of well being among children in 29 of the most wealthy countries. The report (a full version and a summary) are available from this link.
The report shows pleasing progress for the UK (our place on the overall ranking has gone up from last place to 16th) with an improvement in obesity levels and a reduction in consumption of alcohol, cigarettes and drugs compared to the 2007 report.
However, worryingly, the UK is ranked 24th in the table with regards to its provision of Education. The biggest weakness highlighted, is the fact that the UK has one of the lowest percentages of young people continuing with education post 16 (only 74%) and very high levels of young people not in education, employment or training at all (nearly 10%). Students of economics could use this as evidence of government failure with regards to supply-side policies - with such a low level of participation in comparison to our major competitors can we guarantee that we are developing skills that will allow the economy to grow in the future? Could your students suggest (and then evaluate) suggestions for how this situation could be remedied?
Unit 2 Macro: Labour Costs in the European Union
The European Union has just released some new figures on the spread of hourly labour costs among the member nations of the European Union. Labour costs are made up of wages & salaries and non-wage costs such as employers' social contributions e.g. national insurance payments in the UK. Students who have covered aggregate supply and demand theory might be able to consider why changes in labour costs can have an effect on key macroeconomic indicators such as inflation, demand, exports and growth.
Hourly labour costs are different from unit labour costs - the latter takes into account the productivity of people employed. For example, a 5% rise in hourly labour costs will leave unit labour costs unchanged if productivity rises by 5% over the same time period.
read more...»Resources on the Economic Legacy of Margaret Thatcher
There is huge media coverage of the death of former Prime Minister Margaret Thatcher. In this blog we are pulling together some resources that focus on the economic effects of her 11 year period of office.
read more...»Unit 2 Macro: Investment in UK Economy Remains Low
Capital investment spending in the UK has remained below 15% of GDP for four years and there are few strong signs that investment in Britain will rebound strongly in the near term. No other country inside the Group of 7 (G7) had experienced investment below 15% of GDP in any single year in the last thirty - it is clear that investment in the UK remains stuck in the doldrums and this may have damaging consequences for short term recovery and long-term competitiveness and growth.
Unit 2 Macro: Wealth of Nations and Human Capital
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 hereThe Changing Wealth of Nations - World Bank reports can be accessed here
read more...»
Unit 4 Macro: Getting Back to Growth - Lessons from the 1930s
How Britain escaped from the travails of the Great Depression and achieved 4% a year growth in the years from 1933 to 1937 has important lessons for today’s policy-makers, according to research by Professor Nicholas Crafts, presented at the Economic History Society’s 2013 annual conference.
read more...»
