Get Summer 2014 Right First Time with tutor2u Exam Coaching & Revision Workshops
I hope I'm right about this, but there should be plenty of blogs in 2014 on the impact of any economic recovery on inflation, unemployment, trade and so on. At this stage, even the idea of an economic recovery might seem a bit optimistic (Paul Ormerod looks back over 2008-2013 here). After all, we're only talking about the economy getting back to where it was in 2008, in GDP terms.read more...»
The end of a year is a good time to take stock. For the first time since 2007, prospects for the UK for the forthcoming year look unequivocally good. But looking back, just how bad have the last few years been across the developed world as a whole? And how do they compare with previous recessions in a historical context? To keep you out of suspense, the answer to both these questions is ‘pretty bad’. In one key respect, it has been awful.read more...»
The GINI coefficient for Switzerland is already low, at 29.6 (compared to the UK's 34, US's 45 and an EU average 30.4). Current data indicates the relative strength of the economy - real GDP growth at 1.9% in quarter 3 of 2013 (compared with a year earlier), 3.2% unemployment, real incomes rising, a current account surplus, high levels of both inward and outward FDI and a small government budget surplus. But things can always be improved, and the Swiss approach to 'direct democracy', which allows citizens to call for a referendum on anything they want, if they can gather 100,000 signatures calling for a vote, is currently resulting in a series of proposals to promote equality and social welfare.read more...»
The contrasting reactions to Vince Cable's announcement that the Government is launching a consultation on zero hours contracts but will not ban them because they offer "welcome flexibility" for some workers, offer some good opportunity for stakeholder analysis. The report linked here summarises the government's analysis of the advantages and disadvantages, emphasising the benefits of flexibility for both employers and workers, but also the need to ensure fairness and transparency in the labour market. Here you have the differing viewpoints of employers, from the Institute of Directors andread 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...»
With Christmas fast approaching, a gift card can be a tempting present when you have run out of ideas or simply think that the recipient will be happier choosing their own gift. But a good economics student should know that there are both micro and macroeconomic implications of this decision!read more...»
Here it is - a monster 20-question Biz Quiz covering some of our favourite business stories from 2013. This is a tough one. Is there anyone out there who can get all 20 correct?
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...»
Calling all previous delegates of our Wow Economics CPD events! If you attended Wow Economics last academic year (2012-2013) you may recall an activity called 'The Average Wage Game'. If you have attended this academic year I'm sure you will remember the activity 'The Value of Occupations'. Both resources were aimed at introducing or stimulating initial discussion about wage determination before moving on to developing the theory behind Marginal Revenue Product and its value.
Both activities relied upon data relating to UK wage rates by occupation. This data was based upon information taken from what was the latest ONS report on wages in the UK (November 2012). I said, at the time, that when the data was updated I would forward information for both games so that teachers can update them accordingly. This information is now here and ready for you to download!read more...»
We can get such a lot from maps and infographics - far more than one blog can cover. Before I set to work putting a few favourites together, here's a great one for UK earnings.read more...»
We are delighted to pass on details of a development economics conference that is being organised by the Marshall Society at Cambridge scheduled for Saturday 25th January 2014. The one-day event will be held at the famous Cambridge Union buildings in central Cambridge and promises to be an excellent opportunity for interested, enthusiastic and ambitious sixth form students keen to deepen their awareness and understanding.read more...»
Which of these brands are British?
- Newcastle Brown
- Aston Martin
- Rolls Royce
- Branston's pickle
- Land Rover
- HP sauce
- PG Tips
- John Smiths bitter
- Sarson’s vinegar
- Rowntree Mackintosh
If you didn't quite grasp the importance of agglomeration economies in driving and sustaining growth and wealth creation in cities, then this wonderful piece from Bridget Rosewall will do it I am sure! It highlights the importance of vision and a willingness to take risks in bond-funded infrastructure projects in London (and elsewhere). Bridget Rosewall's new short book is available direct from the publishers - click here for details
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...»
The phrase ‘industrial policy’ seems to take us decades back in time. In 1964, a powerful catchphrase of the new Labour Prime Minister, Harold Wilson, was the need for Britain to embrace the ‘white heat of the technological revolution’. Sadly, by the 1970s this vision had deteriorated into a list of institutions, stuffed with dull businessmen and trade unionists, meeting to decide how to prop up yet another failed sector of the UK economy.
But the concept is now back in vogue. Perhaps surprisingly, given the historical experience, the coalition chose to preserve Labour’s Technology Strategy Board (TSB) quango. The TSB has a budget of £400 million to “accelerate UK economic growth by stimulating and supporting business-led innovation”. A key way in which it plans to do this is through the purchasing decisions of the public sector.read more...»
The availability heuristic is a mental shortcut that occurs when people make judgments about the probability of events by how easy it is to think of examples. The availability heuristic operates on the notion that if something can be recalled, it must be important. Subsequently, people tend to heavily weigh their judgments toward more recent information, making new opinion biased toward that latest news.
During this week's Champions League match between Man Utd and Shakhtar Donetsk
The euro should either be dismantled in an orderly way or the leading members should do what is necessary to make it growth- and employment-friendly as fast as possible. That is the central message of Nobel laureate Professor Sir Christopher Pissarides, when he delivers his inaugural lecture as the first Regius Professor of Economics at the London School of Economics.
Professor Pissarides was once a passionate believer in the benefits of European monetary union. He now thinks that either the euro should be dismantled or the direction of economic policy dramatically reversed so as to promote growth and jobs and avoid creating a lost generation of educated young people.
‘We will get nowhere plodding along with the current line of ad hoc decision-making and inconsistent debt-relief policies’, he will say. ‘The policies pursued now to steady the euro are costing Europe jobs and they are creating a lost generation of educated young people. This is not what the founding fathers promised.’
The co-recipient of the 2010 Nobel Memorial Prize in Economic Sciences will outline what needs to be done to bring Europe back to life:read more...»
Boris Johnson has got into trouble for his statement that it is "surely relevant to a conversation about equality" that just 2 per cent of “our species” has an IQ over 130. Over the past couple of years, the Occupy movement has made headlines by attacking the top 1 per cent.
The summer 2013 edition of the top American Journal of Economic Perspectives focuses specifically on the “Top 1 Per Cent”. This is written almost exclusively in English rather than maths, and top economists debate a range of intriguing questions.read more...»
A nice example of price discrimination by manners - charging different prices to different consumers for a coffee, depending on whether they are polite when they request one or not:
Two cartoons to illustrate two key issues: Britain doesn't export enough (especially goods) and so has a large current account deficit.
That's not to say that the UK doesn't have significant exports markets - but where?read more...»
Students tend to struggle with drawing externality diagrams, so I designed this flowchart to help them to get to grips with them. It is primarily used for AQA students who need to know four different diagrams.
If anyone would like the original Word document, feel free to contact me @PhilsEconomicsread more...»
Twenty years ago, South Africa had a GDP of $136bn. Today, that has almost tripled to $385bn. Tax receipts have risen from 114bn South African Rand to 814bn Rand, and in the last ten years labour productivity per worker has risen from $8,800 to $25,600. Electricity was available to only 58% of households in 1996, now it is available to 85%. And social grants for welfare which were paid to 2.4mn people in 1994 are now paid to 16.1mn.read more...»
Ed Conway's analysis of the UK (and EU) housing market provides excellent discussion points:
Read the detailed analysis here.
The clip from Geoff Riley’s Economics at the Movies - The Hudsucker Proxy post is now a staple in my classroom - a great way to introduce the idea that price is only one of the factors that impacts on demand for a good or service. This year, a quick trip down to the P.E department made it an even more enjoyable lesson.read more...»
Amongst all the festive fare, I spotted this article - flagged up on Tyler Cowen's excellent Marginal Revolution website (a prime of example of how Economics can be cool! Really!!!) - on the Behaviourial Insights Team at 10 Downing Street. "The what?", I hear you cry. It's the Ministry of Nudges, that branch of government that tries to utilise the insights of Thaler and Sunstein to improve the delivery of policy.read more...»
What links Midsomer Slaughter, pig breeders, empty boxes, and Piers Morgan? All fall into a category of embarrassing exports from Britain.read more...»
The M6 Toll Road or Birmingham Northern Relief Road, is a 27 mile section of motorway operated by Macquarie Atlas Roads's subsiduary Midlands Expressway.read more...»
Dust off your free trade notes... After many years of being dogged by the failure of the Doha Round of negotiations, the World Trade Organisation finally reached a historic deal this weekend after all 159 members agreed to a package of measures that is expected to boost global trade by $1 trillion through standard customs procedures (the trade facilitation agreement), and gave developing countries room to provide subsidised food to the poor.
This weekend saw the first multilateral pact passed in the global trade body's 18-year history.
India secured a deal which would allow it to offer farm subsidies for public stockholding and food security programmes without inviting any censure. It will now be able to smoothly implement its ambitious Food Security Act, which would otherwise have led to breaching of the farm subsidy limit allowed under the WTO pact of 1994.
The WTO agreement on agriculture limits food subsidies to 10% of the output. The developed countries were offering a 4-year "peace clause" to developing countries.
It demonstrates that the WTO can work and hopefully will lead to other, maybe even bigger deals going forward.
To read more analysis of this deal, see these links:
Hopefully the UK economy will turn a corner in 2014 and return to robust growth and good health, raising living standards for some of the poorest people in the UK. It would be very odd if you hadn't reflected on the plight of the poor in the UK over the last few years, and in the build up to Christmas.
Much discussion of poverty in Economics is of a normative nature. What do we mean by poverty anyway? Isn't it all just a matter of opinion? Is poverty a lifestyle choice, picked up by people who have been given the wrong incentives by the welfare system? Perhaps it's the fault of immigrants, or greedy business, or dishonest politicians.....
Some relatively impartial data would be very welcome in this very heated debate.read more...»
That time of the year again... Fancy the ‘12 days of Christmas’ gifts? It’ll cost you $27,393.17 in 2013.
The cost of buying your true love all the gifts named in the holiday song "The 12 Days of Christmas" has shot up in 2013, according to a holiday-themed inflation index, significantly outpacing the rate of U.S. inflation.
Find out more here: http://www.cnbc.com/id/101238587
You can buy a Partridge for $80 and a Pear Tree for $162.44
Nine Ladies Dancing vaulted with a 20 percent this year, while Lords-a-Leaping jumped 10 percent, combining for a $1,736 increase from 2012.
True Loves will pay a grand total of $39,762.61 to buy the items online, a drop of 1.7 percent from last year, yet still $12,300 more than buying in person.
Very thoughtful True Loves must fork over $114,651.18 for all 364 gifts, a slightly more "reasonable" increase of 6.9 percent increase compared to last year.
"In general, Internet prices are higher than their non-Internet counterparts because of premium shipping costs for birds and the convenience factor of shopping online,"
Much like the government's CPI, the PNC CPI also measures a Core Index -- up an even more dramatic 10.6 percent this year - that excludes the Swans, which tend to be the most volatile in the index. This year, however the swans remained steady from 2012 at $7,000, which is also the same price they cost in 1984, the first year of the index.
Other Key Components Include:
-- Seven items: the Partridge, Two Turtle Doves, Three French Hens, Five
Gold Rings, Six Geese-a-Laying, Seven Swans-a-Swimming and Eight
Maids-A-Milking, remained the same price as last year.
-- Muffled Increase: The prices for 11 Pipers Piping ($2,635.20) and 12
Drummers Drumming ($2,854.80) advanced minimally this year, both up just
-- Pear Tree: While housing prices in the general economy have been on the
upswing, the PNC CPI splintered that trend as the Pear Tree dropped in
price by 3.2 percent, down to $184.00. This is the only item in the index
to drop in price this year.
-- Maids-a-Milking: As the only unskilled laborers in the PNC CPI, the price
for the eight Maids-a-Milking is represented by the minimum wage. With
the Federal minimum wage flat at $7.25 per hour, hiring the maids this
year will not increase labor costs.
A piece of festive government intervention from Wiltshire County Council, and a good way to consider cost benefit analysis linked to the suspension of car parking fees. It helped with some of my Christmas Shopping.
Employees in the UK are not being denied their fair share of economic growth, according to research by João Paulo Pessoa and Professor John Van Reenen, director of the Centre for Economic Performance at LSE. Their investigation of claims that wage growth has become ‘decoupled’ from productivity growth finds that decoupling has been overstated and cannot be used to justify redressing the balance between wages and profits.read more...»
We’re very used to the idea of monitoring inflation, measuring it, and worrying about the consequences of it. But like any good answer that requires an element of balance, it’s worth noting that too little inflation can be a problem too.read more...»
Our Wow Economics teacher CPD event is continuing its tour of the country with events planned for Edinburgh (7th January) and Cardiff (10th January) in the New Year.
If you've never attended a Wow Economics event before you are missing out on a day of high-quality teaching resources and a chance to network with other passionate teachers.read more...»
Great Newsnight clip with Paxman on form grilling Coca Cola about sugar content and labelling. Could also be used for, negative externalities and social responsibility in business.
This is a version of a revision and summing up game that can be helpful at the start and the end of topics.read more...»
This is a one page revision sheet covering some of the key data on the state of the UK economy - I hope it might be useful for students taking their mock exams in macroeconomics. There was also an excellent feature on prospects for the UK here - Is Britain's economy really on the path to prosperity? (Observer, 1st December 2013)read more...»
An eight page practice paper for the structured MC question section of EdExcel Unit 1 Economics - answers in the grid below. Download the practice paper as a pdf: Structured_AS_Micro_MC_Question_Practice.pdfread more...»
Tips on exam technique for answering unit 4 Macro questions - improve your exam scores by writing stronger paragraphs and evaluating wellread more...»
A streamed presentation on aspects of the price mechanism with links to three revision quizzesread more...»
This advert makes me want to sell my house and my car and buy a Volvo truck. I have tried to use this clip in a few Transport Economics lessons. You can use it to show the use dynamic efficiency, R&D, absence of sunk costs, non-price competition or just watch it for sheer amazement. I promise, your students will love it.read more...»
There are a lot of advent calendars in my household. My children have one each and even the dog has one. With this in mind I thought I would create one for my Economics students and here is the attempt.
It is aimed at AS students, but I will also be using it with my A2 students (a little starter activity) as there are a mix of AS linked questions and more general/festive questions.
The release of two major new iterations of games console including the PS4 is an opportune moment to take stock of the transformation of the oligopolistic computer gaming industry into one whose revenues now exceed films and where social gaming, connectivity and collaboration are features of an industry where dynamic efficiency is crucial. Paul Mason from Channel 4 news reports in this short clip.read more...»
Here is an updated revision glossary covering key terms on markets and government interventionread more...»
Price fixing and bid rigging by groups of firms in Europe are not solely the preserve of highly concentrated industries. According to research by Professor Stephan Davies and Dr Oindrila De, even industries with relatively large numbers of firms feature such anti-competitive practices – and they typically have a ‘ringleader’, which organises and enforces the cartel. Their study, published in the November 2013 issue of the Economic Journal, finds that roughly a quarter of the 89 cartels detected by the European Commission over the past two decades have a ringleader or ringleaders. In cartels with relatively large numbers of firms, the ringleader tends to be the dominant firm, acting aggressively to set prices and ensure that smaller firms fall in line.read more...»
Working with one of my A2 Economics classes, we spent a few lessons rsearching useful case studies for the development economics section of Edexcel's course. Here is the results of our work.read more...»
Notes from a talk on eradicating poverty given by Mark Goldring – Chief Executive of Oxfam at the LSE on Thursday 28th November.read more...»