Economists call for a fiscal tightening

A group of leading economists has written to the Sunday Times stressing the need for a credible and timely start to reducing the UK government’s fiscal deficit. The letter can be found here.. Among the letter’s signatories are Kenneth Rogoff, a former chief economist at the International Monetary Fund; Howard Davies, director of the London School of Economics and former head of the Financial Services Authority; and Roger Bootle, former chief economist at HSBC

There is plenty of interest and significance here for A2 students

“The bulk of this fiscal consolidation should be borne by reductions in government spending, but that process should be mindful of its impact on society’s more vulnerable groups. Tax increases should be broad-based and minimise damaging increases in marginal tax rates on employment and investment”

1/ What is a structural budget deficit?
2/ Why do the economists favour cuts in government spending over higher taxes?
3/ Can you think of broadly-based tax increases that might be introduced?
4/ Why are the economists concerned about the impact of higher marginal tax rates on employment and investment?

More here from the BBC: Economists urge swift action to reduce budget deficit

Investment in Energy Infrastructure [23 May 2012]
Unit 2 Macro: Cyclical and Structural Economic Issues Facing the UK [23 May 2012]
Unit 2 Macro: Evaluation on Supply-Side Policies [21 May 2012]
Unit 2 Macro: The Current Account of the Balance of Payments [20 May 2012]
Unit 2 Macro: Migration and the UK Economy [20 May 2012]
Unit 2 Macro: Positive and Negative Multiplier Effects [20 May 2012]
Unit 2 Macro: The Importance of Productivity [20 May 2012]
Unit 2 Macro: Measuring Unemployment in the UK [20 May 2012]
Q&A: What do we need to know about output gaps? [20 May 2012]
Unit 2 Macro: The Output Gap [20 May 2012]
Revision notes on unemployment [20 May 2012]
Unit 1 Micro: Revision Presentation on Government Intervention [16 May 2012]
Unit 1 Micro: Revision Presentation on the Price Mechanism [16 May 2012]
Improving Evaluation Skills in Economics Exams [16 May 2012]
Unit 4 Macro: African Human Development Report 2012 [15 May 2012]
Unit 1 Micro: Economics of a Minimum Wage [12 May 2012]
Unit 1 Micro: Poverty and Inequality and Market Failure [12 May 2012]
Unit 2 Macro: Revision Notes on Supply-side Policies [10 May 2012]
Unit 1 Micro: Revision Blogs on Markets and Intervention [10 May 2012]
Unit 2 Macro: Model answer for revision data question [9 May 2012]
Unit 2 Macro: 10 Key Revision Topics for EdExcel [7 May 2012]
Unit 2 Macro: Growth and Development Glossary [5 May 2012]
Unit 2 Macro: Trade and Balance of Payments Glossary [5 May 2012]
Unit 2 Macro: Unemployment Glossary [5 May 2012]
Unit 2 Macro: Fiscal Policy Glossary [5 May 2012]
Unit 2 Macro: Economic Cycle Glossary [5 May 2012]
Unit 2 Macro: Aggregate Demand Glossary [5 May 2012]
Exam Technique for Economics - Weesteps to Evaluation [5 May 2012]
Macro Revision - Key Statistics on the UK Economy [4 May 2012]
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Macro Revision: Putting Things in Context [29 Apr 2012]
Tullow Oil and African Development [25 Apr 2012]
Unit 4 Macro: The Euro Zone Crisis (Revision) [22 Apr 2012]
Unit 2 Macro: Heathow’s Capacity and Connectivity Crunch [22 Apr 2012]
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Unit 2 Macro: Better news on jobs in the UK? [19 Apr 2012]
Unit 3 Micro: Key Diagrams for Business Economics [17 Apr 2012]
Unit 4 Macro: Managing the Global Commons - Limits to GDP [15 Apr 2012]
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Unit 2 Macro: Skills Shortages Hold Back Recovery [12 Apr 2012]
Government Intervention in the Energy Market [11 Apr 2012]
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Superb article on unemployment [8 Apr 2012]
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Unit 1 Micro: The Collapsing Price of Carbon [3 Apr 2012]
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Unit 2 Macro: Revision on Capital Investment [30 Mar 2012]
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Life in the Slow Lane - UK Growth in 2011 Lags the Euro Area [28 Mar 2012]
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Unit 2 Macro: Seasonal and Structural Unemployment [15 Mar 2012]
Unit 2 Macro: Policies to Drive Economic Recovery [9 Mar 2012]
Unit 1 Micro - Labour Migration and the Economy [5 Mar 2012]
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Unit 1 Micro: Highest and Lowest Paid Jobs in the UK [26 Feb 2012]
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Unit 2 Macro: Living below the Breadline [19 Jan 2012]
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Unit 4 Macro: Time to Re-Boot the British Economy [14 Jan 2012]
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Unit 4 Macro: Competitive Advantage in Trade (Some Videos) [12 Jan 2012]
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Unit 2 Macro: Factors Driving Business Investment [10 Jan 2012]
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Unit 4 Macro: Natural Disasters and their Economic Impact [7 Jan 2012]
Unit 2 Macro: Revision Quiz on Economics of Unemployment [5 Jan 2012]
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Unit 4 Macro: Video Resources on Unemployment [3 Jan 2012]
Unit 1 Micro: Prezi on the Economics of Negative Externalities [2 Jan 2012]
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Unit 2 Macro: The UK Housing Market in 2011 [26 Dec 2011]
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