Economics CPD Courses Coming up this Term!- Book Your Places Now!
I really enjoyed reading this blog from Simon Taylor on the diminishing role of cash in contemporary economic life. Increasingly most cash is held in high denomination notes, even small scale transactions such as buying a coffee at the railway station or a book at the airport bookstore are paid using debit and credit cards. Is cash as a medium of exchange in almost permanent secular decline?
Simon Taylor looks in his blog at the concept of seignorage - the return on producing notes and coins for governments and their central banks.
Just recently I lost both of my debit cards and was grateful that I usually hold fairly large cash balances to ease my way through a week or so without a card to use. It certainly made me more aware of what I was spending!
Here is the link to the blog: http://www.simontaylorsblog.com/2014/08/27/could-w...
Sir James Mirrlees is one of the mere handful of British recipients of the Nobel Prize in economics. As his fine old Scottish surname might suggest, he has been active in the debate on independence. His latest intervention, which has attracted considerable publicity, is to pronounce that an independent Scotland should be willing to repudiate its share of the UK’s public sector debt. This would be, Mirrlees asserts, a bargaining chip to be used to ensure that a currency union with the rest of the UK will be set up. The Bank of England would continue to act as a lender of last resort to the Scottish banking system.read more...»
As commemorations continue, there is a feature on the BBC website, where Economics Editor Hugh Pym looks at the impact of the Great War on the UK economy. It’s a short, accessible piece with some interesting video clips.read more...»
Lord Adair Turner delivers the opening keynote speech of the Rethinking Economics 2014 conference at UCLread more...»
Tim Harford, the Undercover Economist has written an excellent article here on the impact of large scale monopolistic businesses on our economic welfare. Originally published in the Financial Times, you can read it in full by clicking this link to Tim's website. http://timharford.com/2014/08/monopoly-is-a-bureau...
Are highly profitable monopolies a crucial source of innovation (improvements in dynamic efficiency)? Or should we be looking for rigorous competition policy to address the X-inefficiencies often associated with established market dominance?
"The ferocious cut and thrust of smaller competitors seems a more reliable way to produce many of the everyday innovations that matter."
I am delighted to speak at this new event to be held at Bedales School in Hampshire on Thursday 9th October. More details of the event can be found by clicking this link: http://www.bedales.org.uk/home/events/leading-inde...read more...»
Here is some background on Amazon's all-cash purchase of live gaming site Twitch. Read through it and consider some of the likely business synergies from the acquisition.read more...»
Here is an excellent example of how adverse weather conditions can impact on the market price of a staple item in millions of people's supermarket trolleys.read more...»
With all the flurry of football transfer activity happening over the summer months and Manchester United spending a hefty £59.7m for Argentinian winger Angel di Maria, there has been lots of talk about transfer records. With this transfer surpassing the £50m paid by Chelsea for Fernando Torres, the record for a British transfer fee has changed a lot since the first holder of the title, Willie Groves in 1893 went for just £100. You can get a nice history here in this article at the BBC http://www.bbc.com/sport/0/football/28939359. These figures do not represent the 'real' value of the transfers however.read more...»
Standard economic theory would tell us that for many goods and services, price acts as a reasonably successful rationing device. In most countries, food is subject to market prices, with welfare payments and sometimes lower indirect taxes aiming to make it more affordable to those on lower incomes.read more...»
Here is a timely polemic from Will Hutton arguing for a return to state ownership of the railways and pointing to the success of Network Rail and Directly Owned Railways (which runs the East Coast line) as evidence in support of the argument that "networks of key public services such as rail are natural monopolies; ownership in other countries respects that truth, and Britain's attempt to escape it has been a costly debacle.' Do you agree?
Read the article here: http://www.theguardian.com/commentisfree/2014/aug/...
An autumnal hat tip to Robbie Harris from Sherborne for spotting and sharing this interesting discussion piece from Chris Huhne in the Guardian. There are many drivers of the reduction in energy consumption per unit of GDP for the UK economy - among them technological change, a global shift of production to the East, along with sustained high energy prices. But some of the longer term trends look more favourable. Has the UK moved decisively from the peak of the Kuznets environmental curve?
"The UK economy has doubled in real terms since 1985, but total energy consumption is exactly the same as it was in that year. Indeed, energy consumption has fallen since 1970 while the economy has nearly trebled in size."
Is Huhne overly optimistic about prospects for sustainably green growth?
Read the article here: http://www.theguardian.com/commentisfree/2014/aug/...
Data on energy trends from the ONS can be found here: https://www.gov.uk/government/collections/energy-t...
Guardian articles on the energy industry can be found here: http://www.theguardian.com/business/energy-industr...
The tutor2u briefing document on the new A Level Economics specifications (first teaching Sept 2015) is now available
If you have requested a printed copy, the tutor2u office will be sending this out later this week.
The briefing document aims to highlight the key changes for teaching colleagues and also compares and contrasts the different approaches adopted by the three main exam boards. I have also shared my views on the relative merits of the specifications that I hope will become just a small part of a vigorous and healthy debate among colleagues in the coming weeks and months!
The tutor2u team is preparing a series of new teaching & learning resources to support the extended use of quantitative methods in all the new specifications. This course is running in December to give colleagues plenty of time to integrate these resources and approaches into their planning for Sept 2015.
Nobel Laureate Alvin Roth (2012) gives his view on Repugnant Marketsread more...»
Nobel Laureate Joseph Stiglitz (2001) gives his view on why inequality mattersread more...»
Nobel Laureate Joseph Stiglitz (2001) gives his view on What Makes A Good Economistread more...»
Nobel Laureate Alvin Roth (2012) gives his view on How useful economics is. For more on Roth's work in theories of market exchange in areas such as organ donation click the links below.read more...»
Continuing from my last blog on the Foundations of Economics, another purpose of induction lessons is to help students develop a sense of international mindedness that is a feature of good economists, using examples of key current issues from around the world. There are a number of central themes on the IB spec and a few resources here that might make a good startread more...»
At the end of last term all our year 12's were set the task of writing a short article about a different developing country. They were tasked with covering:
- Key information- e.g. GDP, HDI, Gini coefficient, indicators of level of poverty/development
- What factors are limiting growth & development in this country
- How is the government and other stakeholders trying to promote growth & development in this country
- How successful have they been so far?
I have collated all these articles together into an e-book which teachers and students studying development economics should find very useful to make use of as part of the course.read more...»
A hat tip to Hannah Thomas who has spotted a new info graphic on human capital produced by the Office for National Statistics. You can find it here http://www.ons.gov.uk/ons/rel/wellbeing/human-capi... with more supporting detail and explanation here http://www.ons.gov.uk/ons/dcp171766_374868.pdfread more...»
De-mergers often figure in EdExcel Unit 3 questions e.g. on the structured multiple choice - so this one from mining giant BHP Billiton is a good example to be aware of and to understand the key drivers behind the decision. BHP Billiton plan to sell (divest) non-core assets such as their aluminium, manganese and nickel mines.
As always - focusing on core competencies, streamlining operations to avoid diseconomies of scale lie at the heart of the de-merger process
BHP Billiton is hugely profitable! BHP achieved full-year profits last year of $US13.8bn helped by a 15th straight year of record iron ore production.
More here on the planned demerger from Reuters Business Newsread more...»
Western Union and MoneyGram dominate the money transfer industry and the high level of fees that these companies has been heavily criticised in recent years. This is an important article given the huge scale of remittance transfers in the world economy to relatively poor countries such as India, the Philippines and many sub Saharan African nations.
Click here for an info graphic on remittances produced by the World Bank: http://econ.worldbank.org/WBSITE/EXTERNAL/EXTDEC/E...
Here is a really excellent blog on the issue of growth divergence - Simon Taylor contrasts the historical growth records of the United States versus Argentina and then South Korea against Ghana. The accompanying charts reveal starkly the widening gap in GDP per capita between each pair of countries over the very long term.
I will be following Simon Taylor's blog as the new school year comes into focus http://www.simontaylorsblog.com
I am arranging a one day discussion forum and seminar on economics teaching at Eton College, Windsor on Monday 17th November
The main aim of the day is to have an open discussion on teaching and learning strategies whilst sharing good ideas and resources and building networks between economics teachers from many different schools and collegesread more...»
The Asian Development Bank website is an excellent source of information and analysis for many of the developing / emerging countries that students will want to focus ones part of their A2 and IB economics studies. Click here to access their resources: http://www.adb.org
The RES is delighted to announce that the 2014 Young Economist of the Year is:
Kartik Vira of Hills Road VI Form College, Cambridge, who will receive the glass trophy and a prize of £1,000.
Second place goes to Jessica Zeng, Withington Girls’ School, Manchester (£500).
Joint third place goes to: Viva Avasthi, King Edward VI Handsworth School for Girls, Birmingham;
David Bullen, Manchester Grammar School;
and Hannah Dudley, Toot Hill College, Nottingham, each of whom will receive £250.
Here are the Economics A Level stats updated for this summer (June 2014)
Economics passes 70k for the first time in many years!
Student numbers taking AS Econ have more than doubled over the last 8 yearsread more...»
Plans for the Swansea Bay tidal lagoon power station are potentially a superb case study to use when teaching the multiplier effect, renewable energy, cost-benefit analysis, economies of scale and different forms of government intervention including subsidies for harnessing new energy sources.
According to an article in the Independent:
"The £850m, six-mile-long U-shaped seawall by the Swansea docks will not only generate enough electricity to power 120,000 homes for 120 years – it will also create nearly 2,000 construction jobs in the two years it takes to build; and it will leave the city with a tourist attraction drawing in up to 100,000 visitors a year."read more...»
This is a really excellent piece from Larry Elliott at the Guardian on some of the factors that the Bank of England will take into account when deciding the moment to move policy interest rates up from their historic low of 0.5%. To think, there are students who might make it through their entire secondary school education without experiencing a change in UK monetary policy interest rates!
My 2014 Edexcel Unit 3 Course Companion has been extensively revised and updated. New elements include updates on recent changes to UK competition policy, an extended business glossary and numerous exam tips for stronger analysis and evaluation built into the main text. There is a large number of topical case study applications throughout the 29 main chapters and 142 pages.
You can place an order for this companion - which is available for immediate dispatch - by clicking this link http://tutor2u.net/acatalog/Edexcel-A2-Economics-U...read more...»
When students first ask what economics is all about, I always find it tricky not to give a very long answer. It’s the same when starting to plan those induction lessons in economics: what will help them to understand the base principles of the subject but also develop an awareness of the economist’s mindset? At IB, the Foundations of Economics section of the syllabus sets out what to cover quite nicely. I've shared a few useful resource links below.read more...»
This article from the BBC news site is excellent for teachers and students wanting some applied examples of businesses that have succeeded in building through organic growth a durable market presence in the USA and some examples of bigger names / corporations that have failed.What are the key ingredients? How do import tariffs affect a business such as Brompton Bikes?
This is an excellent background video clip to use when teaching / studying capital-labour substitution and the likely changes in the pattern of demand for labour / employment in the UK jobs marketread more...»
A new study finds that incentives to switch to green vehicles produce big health benefitsread more...»
At the August 2014 Lindau Meeting, several plenary lectures by Nobel laureates will illustrate some of the ways in which economics can be useful for dealing with real-world problems. Here are some summaries of the presentations.read more...»
I’m always on the lookout for GDP stories – what is GDP, how is it measured, and what are the problems of using GDP to measure social progress, standard of living and sustainability.
Big changes coming to the national accounts next month, which means that GDP will be calculated slightly differently.read more...»
Why do we get summer holiday blockbusters? They seem to matter more and more to Hollywood studios. According to one professor "the entertainment industry is moving more towards a winner-take-all-market". Yet it wasn't supposed to be like this. A best-selling 2008 book, The Long Tail, argued that the mainstream was going to be "shattered into a zillion different cultural shards," as fickle consumers "scattered to the winds" using the internet to find the books, films and songs that met their unique taste. So what might be going on?read more...»
An almost perfect example of price discrimination is evident in this market revealed on the BBC online news site - read this section carefully!
"Charges vary for some motorists, even if they are picking up the same vehicle from the same location and from the same hire company."
Then read through the article to find clues as to how some vehicle hire businesses have been able to segment the market and discriminate between drivers from different countries inside the EU.
The regulators are onto the issue - expect some action unless vehicle hire businesses adjust their pricing tactics!read more...»
The Premier League kicks off again this weekend. Given the abysmal showing of our boys in the World Cup, a falling off of interest might be expected. But increasingly, the competition attracts many of the best players from all over the world. A self-reinforcing process has been set up on a global scale. The more popular both the League and its individual clubs become across the world, the more money is brought in through TV rights, merchandise sales and so forth. Even better players can be employed, which increases its attractiveness even further.read more...»
From the final shortlist of 18 essays drawn from a total entry of over 1600, the judging panel of Charles Bean (RES President), Professor Tim Besley (London School of Economics) and Stephanie Flanders (JP Morgan) have selected five winners and wish to congratulate them, together with all of the other students that made the short list.read more...»
Many readers at this time of the year will be looking forward to their summer break, perhaps contemplating with a certain amount of envy their colleagues who have already departed. But is leisure good for you? A bit of a no brainer one might think. Indeed, until recently the consensus amongst applied economists was that even enforced leisure, by being made unemployed, seemed to be a good thing.read more...»
The dates and locations for our programme of intensive exam coaching & revision days for AS & A2 Economics in Spring 2015 are now available. Details below. We'll add details of how to book online to this blog entry shortly.
To see what is involved in our exam coaching & revision days, watch this brief video from a recent event:read more...»
If you are looking for a good recent example of how takeovers can destroy returns for shareholders (of the investing business), then add Morrison’s purchase of Kiddicare to the list!read more...»
Fed up with the closure of a cracked road between Bristol and Bath where repairs were likely to last several months, a farmer has invested £150,000 to build a temporary 365m toll road which saves motorists from having to make a 10 mile detour. The businessman is charging cars £2 and motor cycles £1 for each journey and is offering a £10 offer for regular users who need to use the road on twelve occasions.
This is a lovely example of the difference between a quasi public good and a private good. The toll road has its own booth for collecting the charges and seems to have found favour with local residents. Whether or not sufficient cars make the journey to cover the operating costs remains to be seen. Repair work on the A431 at Kelston are likely to take five months and mean that 1,000 vehicles per day are needed for the project to break even.
The businessman Mike Watts has been using You Tube to provide the background to his decision to build the toll road!read more...»
We are delighted to announce the initial dates and locations for WOW! Economics 2015 - our flagship CPD course for ALL A Level Economics teachers.
WOW! Economics 2015 builds on the phenomenal success of the previous two years with yet another resource-packed day designed to provide teaching colleagues with effective and innovative teaching & learning materials.
The feedback from previous WOW! Economics courses has delighted us and we've grown the team of contributing Economics teachers to ensure that WOW! Economics 2015 is our best-ever.
Don't worry if you missed WOW! Economics 2014 - the full binder and CD of resources from the course can still be purchased from our online store together with a selection of individual resources from the inaugural WOW! Economics 2013.
Here are the initial confirmed dates and locations for the 2015 course programme:
11 November 2014: MANCHESTER
12 November 2014: BIRMINGHAM
13 November 2014: LONDON
25 November 2014: GLASGOW
28 November 2014: CARDIFF
17 June 2015: LONDON
18 June 2015: BIRMINGHAM
19 June 2015: MANCHESTER
A key feature of the new A Level and standalone AS specifications (for first teaching from September 2015) is a greater focus on quantitative methods.
The Ofqual subject criteria with which awarding bodies must comply states that specifications must require learners to:
"...develop analytical and quantitative skills in selecting, interpreting and using appropriate data from a range of sources"read more...»
P&G has announced that it will look to focus on a much smaller number of consumer brands and cull up to 100 brands from its extensive product portfolio. In a classic example of product portfolio management, P&G wants to focus on those 70-80 key brands that have existing strong market shares and/or fast growth prospects.read more...»
Here are some newly published resources covering aspects of behavioural economicsread more...»
I hope that many economics teachers in the UK and beyond will be very interested in following the debates about reforming the undergraduate economics curriculum. This link http://www.res.org.uk/view/art3Jul14Features.html takes you to an entry in the latest RES newsletter which covers some of the changes made to the INET curriculum programme being led by Professor Wendy Carlin from UCL.read more...»
Catastrophe Bonds (or cat bonds) are essentially a bet against natural disaster - insurance companies issue the bonds and investors get paid their interest in the event of natural disasters such as earthquakes not happening.
According to the Financial Times, "catastrophe bonds are typically issued for three years and, if no disaster occurs in that period, bond investors receive a good payout; otherwise, they have to pay out themselves."
Do the investors such as pension funds and insurance companies truly understand the risks that they are taking with (our) money?
Duncan Weldon investigates in this BBC Newsnight report. Ultra low interest rates in advanced economies appear to have encourage pension funds to search for riskier assets (a search for yield) to improve their return on their assets. A major natural disaster could trigger huge losses for those who have piled huge sums of money into them.read more...»