http://www.tutor2u.net/blog/index.php/economics/ en tutor2u.net Copyright 2009 2009-11-19T07:46:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/economics-of-government-subsidies/ http://www.tutor2u.net/blog/index.php/economics/comments/economics-of-government-subsidies/#When:07:46:00Z This new AS economics revision presentation looks at the use of subsidies by government for producers and consumers. Launch interactive presentation on Economics of Government Subsidies Download pdf handout of slides AS Micro, Agriculture, Government Intervention, Subsidies, Market Equilibrium and Price, Price Mechanism in Action, Supply-side policies 2009-11-19T07:46:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/price-volatility-in-markets-teacher-presentation/ http://www.tutor2u.net/blog/index.php/economics/comments/price-volatility-in-markets-teacher-presentation/#When:07:04:00Z This new revision presentation looks at the causes and conseqences of price volatility in markets - particularly commodity markets. It includes links to relevant news stories which help illustrate the basic demand and supply theory. Launch interactive version of presentation on Price Volatility in Markets Download pdf of slide handouts AS Micro, Commodities Markets, Market Equilibrium and Price, Price Volatility 2009-11-19T07:04:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/google-wave-trade-deficits-and-surpluses/ http://www.tutor2u.net/blog/index.php/economics/comments/google-wave-trade-deficits-and-surpluses/#When:22:55:01Z We were back on Wave last night considering some of the wider arguments surrounding persistent trade imbalances. Are trade imbalances a problem? We are hoping that - as more Economics teachers migrate to Google Wave - we will be able to schedule collaborative sessions (typically lasting between 45 to 60 minutes) where we can generate ideas, arguments and perspectives in real time and support eachother’s teaching on chosen topics or issues. A2 Macro, Balance of Payments, Emerging Economies, China Economy, Global Economy, Teaching of Economics, UK Economy, US Economy 2009-11-18T22:55:01-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/who-is-hit-hardest-by-unemployment/ http://www.tutor2u.net/blog/index.php/economics/comments/who-is-hit-hardest-by-unemployment/#When:09:27:01Z One sad consequence of the global recession is rising unemployment.  The figure in the US hit 8.6% of the workforce in September 2009 – with further rises anticipated.  You may well have given thought both to why these increases are occurring and even how unemployment is measured.  Here’s another query: which groups in America have been hardest hit? A2 Macro, AS Macro, Labour Economics, Recession Watch!, Unemployment, US Economy 2009-11-18T09:27:01-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/the-great-fiscal-policy-debate-this-one-will-run-and-run/ http://www.tutor2u.net/blog/index.php/economics/comments/the-great-fiscal-policy-debate-this-one-will-run-and-run/#When:20:44:00Z Stephanie Flanders, the BBC Economics Editor, is assessing what might happen to fiscal policy after the election next year. She has produced reports for the BBC news which can be accessed from her Stephanomics blog, and produced a discussion piece which draws upon current opinion as well as historical evidence to predict the likely differences and similarities between the political parties. As she says, both parties would expect to announce tough budget plans if elected - and both would tend to delay most of the pain until 2011 or 2012, when the economy is more firmly on the mend. There is a nice historical piece about Geoffrey Howe’s tax raising budget in 1981, and a reference to the pro’s and con’s of Vince Cable’s proposal to raise revenue by a “mansion tax” on houses worth more than £1m - one problem being that there are rather fewer of those houses now than there were a few months ago. Many A level students will be voting for the first time in this most important of elections, in which fiscal policy is surely going to be one of the hottest topics, and I would love to give them some of the elements of this discussion to evaluate as they prepare to be some of the better informed new generation of the electorate. A2 Macro, Fiscal Policy, Supply-side policies, UK Economy 2009-11-17T20:44:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/deflation-teacher-presentation/ http://www.tutor2u.net/blog/index.php/economics/comments/deflation-teacher-presentation/#When:07:44:00Z This new revision presentation examines the causes and effects of deflation and the possible economic policy responses. Launch interactive presentation on deflation Download pdf handout of presentation slides A2 Macro, Inflation, Monetary Policy, Supply-side policies, UK Economy 2009-11-17T07:44:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/nationalisation-teacher-presentation/ http://www.tutor2u.net/blog/index.php/economics/comments/nationalisation-teacher-presentation/#When:07:33:00Z This new revision presentation arose out of our first experiment with Google Wave.  It looks at the topical issue of nationalisation. Launch interactive presentation on Nationalisation Download pdf handout of presentation slides A2 Micro, Government Intervention, UK Economy 2009-11-17T07:33:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/consumption-externalities-in-singapore/ http://www.tutor2u.net/blog/index.php/economics/comments/consumption-externalities-in-singapore/#When:06:44:00Z The excellent Jason Welker has a superb post on aspects of consumption externalities in Singapore.  AS Micro, Market Failure, Externalities, Teaching of Economics 2009-11-17T06:44:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/a-first-test-of-google-wave/ http://www.tutor2u.net/blog/index.php/economics/comments/a-first-test-of-google-wave/#When:22:52:00Z Mo Tanweer and I got stuck into Google Wave tonight and I think we found the experience really exciting from a teaching perspective. In little over an hour we made big progress in developing a fresh set of teaching notes on the issue of nationalisation. I chose the initial topic (it ties in with my teaching this week) and Mo has chosen trade deficits as our second wave topic. We started by adding in examples of state-owned enterprises both here in the UK and from overseas (often more exciting and interesting for discussion) before editing some notes on arguments for and against nationalisation. The real time collaborative messaging system is easy to grasp and use. Within sixty minutes we generated many more ideas than had we worked at it alone - and it is thrilling and awesome to be able to edit each other’s points, add examples, embed video into waves, add other links and chat live. Imagine the whole department using this to come up with a worksheet on a tricky topic - you’d be able to do it in 1/4 of the time and come away with a real sense of a team effort in drafting, shaping and pulling a document together. Google has thrown open the source code so expect a wealth of apps to be developed in the next 6 months as Google Wave hits the ground running when it comes out of preview mode. Mo reckons this could work really well when editing / commenting on UCAS statements or essays with kids when they are at home! Online revision takes on a new dimension with Google Wave. We think a critical mass of perhaps four or five contributors at any one time works well - but perhaps we are underestimating the capacity of students to embrace this type of collaborative software - instant messaging on steroids! Google Wave invites seem to be thin on the ground at the moment, but if there are other economics teachers out there with access, we would love to hear from you and invite you to join in a few waves! Come on in, the water is lovely. Teaching of Economics 2009-11-16T22:52:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/going-once-going-twice-still-going-once-going-twice/ http://www.tutor2u.net/blog/index.php/economics/comments/going-once-going-twice-still-going-once-going-twice/#When:17:09:00Z (A hat-tip to C. Gee for spotting this!) For those of you who enjoyed Nudge, here is Professor Thaler in the New York Times discussing an interesting behavioural analysis of the website Swoopo.com. (If you haven’t visited the site yet, it’s very interesting to watch!). A2 Micro, Behavioural Economics, Game Theory 2009-11-16T17:09:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/pay-freezes-and-macro-performance/ http://www.tutor2u.net/blog/index.php/economics/comments/pay-freezes-and-macro-performance/#When:07:13:00Z The forum post I am setting my AS macro students this week focuses on the possible economic impact of wage cuts and pay freezes. I am hoping it will help to develop their evaluative skills and get them to apply some AD/SRAS concepts. As the UK economy continues to experience a recession, pay is under pressure. The average wage in Britain, including bonuses, fell by 0.4 per cent in the three months to March 2009 – knocking about £95 off annual salaries to £24,000. People working in the private sector are at highest risk of a wage freeze or actual wage cut and public sector workers are also at risk of pay freezes in the months ahead. Suggested reading Half of UK firms plan a pay freeze (Telegraph) Pay freeze in deal to save car plants (Independent) Osborne plans one-year public sector wage freeze (Independent) Outlook for jobs will remain grim for several years (The Times) Wage cuts might condemn the economy to more misery (Telegraph) FTSE bosses get big salary rise (BBC news) Examine some ways in which a move towards wage cuts or pay freezes might affect the macroeconomic performance of the UK economy The forum posting is designed to encourage students to read around the subject, develop a concise written style and build evaluation skills. The Moodle system is set up so that students can only see the postings of others once they have submitted their only entry. I will post a couple of replies later on in the week. AS Macro, Cycles and Shocks, Aggregate Demand, Aggregate Supply, Labour Economics, Teaching of Economics, UK Economy, Unemployment 2009-11-16T07:13:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/bottom-line-on-business-clusters/ http://www.tutor2u.net/blog/index.php/economics/comments/bottom-line-on-business-clusters/#When:21:20:00Z Evan Davis and his guests were on fine form this week in the edition of the Bottom Line on Radio 4. They discussed the development of business clusters in different localties and regions - a topic highly relevant to economic geography and one that links in well to external economies of scale and international competitiveness - two A2 topics. The Open University site is recommended for a range of follow-up resources. Business Economics, Teaching of Economics 2009-11-15T21:20:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/oyster-cards-and-pricing-on-the-tube/ http://www.tutor2u.net/blog/index.php/economics/comments/oyster-cards-and-pricing-on-the-tube/#When:21:14:00Z I am hoping that my A2 micro students will be able to apply some of the concepts we have been looking at in recent weeks to this short forum question on pricing on the London Underground. Scratching beneath the surface there is much that can be applied! I will post a selection of answers / thoughts later on in the week. A2 Micro, Business Economics, Teaching of Economics 2009-11-15T21:14:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/ted-talk-edward-burtynsky-photographs-the-landscape-of-oil/ http://www.tutor2u.net/blog/index.php/economics/comments/ted-talk-edward-burtynsky-photographs-the-landscape-of-oil/#When:19:53:00Z Edward Burtynsky photographs the landscape of oil from extraction to refinement and to the end of oil - cars, tyres, planes, and the environmental impact.  His manufactured landscapes DVD is a tremendous resource. Oil and Gas, Teaching of Economics 2009-11-15T19:53:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/easy-coast-line-becomes-state-owned/ http://www.tutor2u.net/blog/index.php/economics/comments/easy-coast-line-becomes-state-owned/#When:16:59:00Z A change of ownership for the much loved London to Edinburgh East Coast Line. East Coast is now operating the service - having taken over from the beleagured National Express. This BBC news report asks whether anything has really changed?  A2 Micro, Business Economics, Government Intervention, UK Economy 2009-11-15T16:59:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/inflation-measurement/ http://www.tutor2u.net/blog/index.php/economics/comments/inflation-measurement/#When:16:39:00Z This updated and extended revision presentation looks at the main measures of inflation - and some of the challenges and problems of measurement Launch interactive presentation on Measuring of Inflation Download printable pdf handout of presentation slides A2 Macro, Inflation, UK Economy 2009-11-15T16:39:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/inflation-causes-and-effects/ http://www.tutor2u.net/blog/index.php/economics/comments/inflation-causes-and-effects/#When:16:18:00Z This updated revision presentation takes a detailed look at the causes and effects of inflation. It explains the theory behind demand pull and cost push inflation, and examines recent trends in data on average earnings, commodity prices and the output gap.  There are also some new weblinks to great interactive resources on inflation. Launch interactive presentation on Inflation: Causes & Effects Download printable pdf handout of presentation slides A2 Macro, Cycles and Shocks, Exchange Rates, Inflation, UK Economy 2009-11-15T16:18:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/bop-question/ http://www.tutor2u.net/blog/index.php/economics/comments/bop-question/#When:18:10:00Z The Korean National Pension Fund (the world’s fifth largest pension fund) is reportedly interested in purchasing UK commercial property. How might this affect the UK balance of payments in the short term and medium term? I will throw this to my students on Monday. Balance of Payments, UK Economy 2009-11-13T18:10:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/economists-on-google-wave/ http://www.tutor2u.net/blog/index.php/economics/comments/economists-on-google-wave/#When:17:22:00Z Are there any Economics teaching colleagues out there with access to Google Wave? I am starting to use it and seek like minded Economists who might want to test a few waves on different topics. My wave email is tutor2uecon@googlewave.com. Thanks Teaching of Economics 2009-11-13T17:22:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/reasons-to-expect-a-nike-swoosh-recovery/ http://www.tutor2u.net/blog/index.php/economics/comments/reasons-to-expect-a-nike-swoosh-recovery/#When:07:10:00Z A failure of trust in global financial markets lies at the heart not just of the current recession but prospects for a sustained recovery in spending and jobs. Whilst journalists play the game of alphabet soup to describe the likely shape of the economic cycle, we might be better off thinking in terms of a Nike Swoosh. World growth is responding to an unprecedented policy stimulus but there is a real danger that the rebound inactivity will be constrained by a set of negative forces pushing down on growth. This was the message from Paul Donovan, Managing Director of Global Economics for UBS in his presentation to the Eton College Keynes Society last night. A2 Macro, AS Macro, Credit Crunch, Cycles and Shocks, Financial Markets, Recession Watch!, Teaching of Economics, UK Economy, Unemployment, US Economy 2009-11-13T07:10:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/google-and-average-revenue-product-of-labour/ http://www.tutor2u.net/blog/index.php/economics/comments/google-and-average-revenue-product-of-labour/#When:06:55:00Z Google’s headcount quadrupled between 2005 and 2009 but for some years the revenue per employee was in decline. This is now in reverse and income from each worked employed is now at a 3-year high at just over $300,000 a year! I might use this chart as a teaching aid when teaching labour market economics - Google is perhaps the world’s biggest advertising agency and it finds even more ways to monetise its services from month to month - whilst keeping the bulk of core functions free to users. Business Economics, Labour Economics 2009-11-13T06:55:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/gold-price-brings-prospectors-to-the-highlands/ http://www.tutor2u.net/blog/index.php/economics/comments/gold-price-brings-prospectors-to-the-highlands/#When:05:55:00Z The high price of gold, reported by Geoff yesterday, is giving a clear signal to a mining company in the Highlands of Scotland that it should start production from a gold mine that was first drilled 20 years ago, but has never been commercially worked because the price of gold did not provide enough incentive to the producers. However with the price of gold now at $1100 per ounce, mining operations could become profitable. Scotgold owns the Coronish mine near Tyndrum, a small village which is en route to Glen Coe, Fort William and Skye. Next month it will apply for planning permission begin mining operations in 2010 and this report from The Guardian says that Cononish is expected to start producing 200kg of gold a year at the mine site when full-scale mining begins in 2011 – enough to produce 30,000 wedding rings a year – and another 500kg each year by sending rocks for processing elsewhere. AS Micro, Business Economics, Commodities Markets, Market Failure, Externalities, Market Equilibrium and Price, Price Mechanism in Action 2009-11-13T05:55:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/will-they-wont-they-will-they/ http://www.tutor2u.net/blog/index.php/economics/comments/will-they-wont-they-will-they/#When:20:58:00Z Ahead of President Obama’s visit to Asia, earlier this week, the Chinese central bank issued a report signalling its intention to perhaps consider allowing a more flexible exchange rate regime come into force. A2 Macro, Balance of Payments, Emerging Economies, China Economy, Exchange Rates, International Trade, US Economy 2009-11-12T20:58:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/death-to-the-deficit/ http://www.tutor2u.net/blog/index.php/economics/comments/death-to-the-deficit/#When:19:51:01Z Following last week’s excellent “Analysis” programme on Economics comes another useful programme. This week, Frances Cairncross presented a programme on the government deficit and argued that tax rises won’t be enough; cuts in public spending across the board will be needed. The programme is repeated on Sunday at 9.30 pm and the podcast and accompanying article can be downloaded here. Next Monday should also be useful: what would happen if we were to leave the EU? Radio 4 at 8.30 pm. 2009-11-12T19:51:01-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/peak-gold/ http://www.tutor2u.net/blog/index.php/economics/comments/peak-gold/#When:12:12:01Z If world supply of gold is now past its peak, the bull run for gold on world bullion markets may have some distance to travel, This is the interpretation of this article in the Telegraph which reports that global gold output has been falling by roughly 1m ounces a year since the start of the decade. Total mine supply has dropped by 10pc as ore quality erodes, implying that the roaring bull market of the last eight years may have further to run. This BBC video report looks at the decision of India’s government to purchase of 200 tonnes from the International Monetary Fund - the single biggest gold purchase by a central bank in the past 30 years. The government is exchanging US dollars for their gold equivalent - a hedge against rising world inflation and a weakening dollar. AS Micro, Emerging Economies, Indian economy, Commodities Markets, Market Equilibrium and Price, Price Mechanism in Action, Price Volatility, Teaching of Economics 2009-11-12T12:12:01-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/apples-cash-mountain/ http://www.tutor2u.net/blog/index.php/economics/comments/apples-cash-mountain/#When:12:12:01Z Apple is amassing a huge cash pile - I might use this when teaching opportunity cost - and ask students why cash is important for businesses in a recession, how Apple has managed to accumulate so much, and what they might do with it. This BBC video provides a support. Business Economics 2009-11-12T12:12:01-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/the-power-of-words/ http://www.tutor2u.net/blog/index.php/economics/comments/the-power-of-words/#When:12:11:00Z Some say that “words have meaning and names have power”. Well when Mervyn King speaks, markets listen. And sell the pound too. A2 Macro, AS Macro, Economic Growth, Exchange Rates, Inflation, Monetary Policy, UK Economy 2009-11-12T12:11:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/economics-of-saving-teacher-presentation/ http://www.tutor2u.net/blog/index.php/economics/comments/economics-of-saving-teacher-presentation/#When:11:48:00Z This revision presentation examines recent data on the extent of saving in the UK economy. Launch interactive presentation on the Economics of Saving Download printable pdf of slides A2 Macro, Credit Crunch, Cycles and Shocks, Aggregate Demand, Saving, Monetary Policy, UK Economy 2009-11-12T11:48:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/uk-recession-and-business-capacity-teacher-presentation/ http://www.tutor2u.net/blog/index.php/economics/comments/uk-recession-and-business-capacity-teacher-presentation/#When:11:11:00Z This streamed presentation provides a snapshot of the latest economic data on UK business capacity. The slump in output in the British economy has left many businesses and industries with a huge amount of spare capacity and the negative output gap is expected to grow beyond 6% of GDP in 2010 according to the OECD. A high level of spare capacity (or productive slack) has important consequences for jobs, inflationary pressures, planned investment and business profits. Launch interactive presentation on Recession & Capacity Download pdf handout of slides A2 Macro, Cycles and Shocks, Aggregate Demand, Capital Investment, Aggregate Supply, Labour Economics, Recession Watch!, Teaching of Economics, UK Economy 2009-11-12T11:11:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/long-run-aggregate-supply-teacher-presentation/ http://www.tutor2u.net/blog/index.php/economics/comments/long-run-aggregate-supply-teacher-presentation/#When:10:32:00Z This updated revision presentation looks at the AS Macro topic of Long Run Aggregate Supply Launch interactive presentation on Long Run Aggregate Supply Download pdf of presentation slides AS Macro, Cycles and Shocks, Aggregate Supply 2009-11-12T10:32:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/a-broader-measure-of-unemployment/ http://www.tutor2u.net/blog/index.php/economics/comments/a-broader-measure-of-unemployment/#When:20:24:00Z The eminently readable Edmund Conway over at the Telegraph has written a blog post looking at a wider measure of unemployment than the published claimant count or labour force survey measure. This measure of unemployment includes: official unemployment, those classed as economically inactive who actually want a job and part time workers who would rather be working full time. The evidence is that this measure has grown by over 1.2million since the start of 2008 and is now pushing 5.7 million. Details here. This is part of a wider debate about the scale of under-employment in modern economies and also the economic and social costs of deep-rooted, persistent unemployment and economic inactivity.  A2 Macro, AS Macro, Recession Watch!, UK Economy, Unemployment 2009-11-11T20:24:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/fast-growing-developing-countries-may-mean-end-of-era-of-cheap-oil/ http://www.tutor2u.net/blog/index.php/economics/comments/fast-growing-developing-countries-may-mean-end-of-era-of-cheap-oil/#When:20:18:00Z A good video to use here when teaching the economics of the oil market/ Oil and Gas 2009-11-11T20:18:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/politics-pen-palatable-taxes/ http://www.tutor2u.net/blog/index.php/economics/comments/politics-pen-palatable-taxes/#When:19:26:00Z A great idea from Newsnight - invite Newsnight viewers to think about ideas for raising tax revenue to help curb the budget deficit and get them to pitch them to a panel of experts including Matthew Taylor and Sir Digby Jones. It raises issues about the canons of taxation - what makes a good tax? Here is the link to the video. A2 Macro, AS Macro, Fiscal Policy, Teaching of Economics, UK Economy 2009-11-11T19:26:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/toy-story/ http://www.tutor2u.net/blog/index.php/economics/comments/toy-story/#When:19:24:00Z The Go Go Hamster is set to be one of the top toys this Christmas. But this, and other toys in high demand, might be subject to a shortage of supply. Retailers had their fingers burned last year as demand for toys fell by 12% and many were left with excess supply after the Christmas period. Many toy retailers make over 50% of their sales in November-December, but the early stages of global recession reduced demand for toys in 2008, shifting the demand curve to the left so that, in order to clear excess stocks, retailers had to reduce prices. In a textbook example of cobweb theory, many have ordered fewer toys this year thus reducing supply, but in fact the early signs on both sides of the Atlantic and across Europe is that demand is, at least partly, restored, so there is now a risk of excess demand.  Credit Crunch, Market Equilibrium and Price, Nature of Demand, Nature of Supply, Price Mechanism in Action, Recession Watch! 2009-11-11T19:24:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/jing-for-the-mac/ http://www.tutor2u.net/blog/index.php/economics/comments/jing-for-the-mac/#When:19:19:00Z Snag-It by Techsmith is a superb screen capture tool for teachers - once downloaded you will use it at least half a dozen times a day! A version for the Mac is under development but for the moment Jing looks like the best alternative - free to download and use. Here is the link. Teaching of Economics 2009-11-11T19:19:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/economics-gtp-vacancy-tiffin-school/ http://www.tutor2u.net/blog/index.php/economics/comments/economics-gtp-vacancy-tiffin-school/#When:17:18:00Z News of a super GTP vacancy for Economics at Tiffin School… 2009-11-11T17:18:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/short-run-aggregate-supply-teacher-presentation/ http://www.tutor2u.net/blog/index.php/economics/comments/short-run-aggregate-supply-teacher-presentation/#When:07:41:00Z Our revision presentation on short run aggregate supply has just been updated.  Here are the links: Launch interactive revision presentation on Short Run Aggregate Supply Download pdf of slide handouts AS Macro, Cycles and Shocks, Aggregate Supply 2009-11-11T07:41:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/us-unemployment-breaking-down-the-data/ http://www.tutor2u.net/blog/index.php/economics/comments/us-unemployment-breaking-down-the-data/#When:17:28:00Z A fascinating interactive infographic from the New York Times which allows you to segment the trends in US unemployment by a series of variables, including ethicity, age and educational background.  Well worth a quick look US Economy 2009-11-10T17:28:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/new-regulatory-agencies-begin-work-today/ http://www.tutor2u.net/blog/index.php/economics/comments/new-regulatory-agencies-begin-work-today/#When:09:40:00Z In A2 micro today we were discussing price-capping by industry regulators as a way of overcoming some of the welfare losses created by monopoly. The new much-expanded regime of regulatory agencies charged with monitoring prices and setting caps when appropriate is available here - can colleagues suggest some more? !! A2 Micro, AS Micro, Business Economics, Competition Policy, Teaching of Economics 2009-11-10T09:40:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/the-economists-new-clothes1/ http://www.tutor2u.net/blog/index.php/economics/comments/the-economists-new-clothes1/#When:23:16:00Z Do you agree with Keynes and wish that economists were “as useful as dentists”? 2009-11-09T23:16:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/after-the-summer-of-luv/ http://www.tutor2u.net/blog/index.php/economics/comments/after-the-summer-of-luv/#When:08:22:01Z A hat tip to John Richards for spotting this article in the Times which also carries a nifty graphic that could work well when teaching the economic cycle. Does the LUV economic model work? Its inventor tests the figures. A2 Macro, AS Macro, Credit Crunch, Cycles and Shocks, Recession Watch!, Teaching of Economics, UK Economy 2009-11-09T08:22:01-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/macro-at-the-moller-fresh-ideas-for-teaching/ http://www.tutor2u.net/blog/index.php/economics/comments/macro-at-the-moller-fresh-ideas-for-teaching/#When:07:36:00Z The Annual Autumn Conference for Economics Teachers - Monday 23 November 2009 Venue: Moller Centre, University of Cambridge Make provisional bookings here ------------------------------------------------------------------------------------------------------------------------------- Just two weeks to go before our Autumn Economics Teacher Conference at the wonderful Moller Centre, Cambridge University. The day has a macroeconomic flavour but also some sessions dedicated to developing web skills for students and teachers to generate ideas and improve their evaluation skills. George Buckley, Chief UK Economist at Deutsche Bank and a frequent commentator on economic issues on television will be giving us a comprehensive macroeconomic update. Jon Clarke will be showcasing some tremendous economic policy simulation games and other PowerPoint-based economics resources. I will be presenting on collaborative web tools inside and outside the classroom. Ruth Tarrant and Amanda Campion will also showcase some of the most popular new economics teaching resources from their recent successful CPD programme. The Moller is a terrific venue and we are looking forward to meeting up with old friends and new. Accommodation is available for those staying on the Sunday night before our event. As usual we will be taking the ‘Sunday Night Crew’ for a hot supper and drinks courtesy of tutor2u and there will be free minibuses for colleagues who need a speedy getaway to the train station on the Monday afternoon. Make provisional bookings here Teaching of Economics 2009-11-09T07:36:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/time-to-reassess-rationality/ http://www.tutor2u.net/blog/index.php/economics/comments/time-to-reassess-rationality/#When:07:06:00Z In today’s Times, Roman Frydman, Professor of Economics at New York University, and Michael D. Goldberg, Professor of Economics at the University of New Hampshire, argue that a much deeper debate is required about economists’ flawed theories of market “efficiency” and “rationality”, which have led economics and policy astray in the past decade. Read the article here. A2 Macro, A2 Micro, Behavioural Economics, Teaching of Economics 2009-11-09T07:06:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/the-recession-in-cartoons/ http://www.tutor2u.net/blog/index.php/economics/comments/the-recession-in-cartoons/#When:22:32:00Z I missed this last week whilst away in Hong Kong - but the Guardian has a lovely section of recession-related cartoons guaranteed to brighten up a worksheet or two! Recession Watch!, Teaching of Economics 2009-11-08T22:32:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/david-blanchflower-on-unemployment-policies/ http://www.tutor2u.net/blog/index.php/economics/comments/david-blanchflower-on-unemployment-policies/#When:22:11:00Z David Blanchflower writes in the new Autumn edition of the RSA’s Journal about the help needed to avert an unemployment time bomb especially for younger workers. This piece builds on his recent talk at the RSA. It is a superb article and has some powerful sections on the economic and social consequences of high rates of unemployment.  A2 Macro, AS Macro, Government Intervention, Labour Economics, Market Failure, Factor Immobility, Recession Watch!, Teaching of Economics, UK Economy, Unemployment 2009-11-08T22:11:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/price-discrimination-teacher-presentation/ http://www.tutor2u.net/blog/index.php/economics/comments/price-discrimination-teacher-presentation/#When:21:41:00Z Fancy watching the Michael Jackson film “This is It” at your local cinema? Demand is strong and box office receipts are booming. As you pay for your ticket keep in mind that your local cinema will be engaging in a number of different forms of price discrimination to convert your hard earned cash into revenue and profit. Take the admission charges for a showing this coming Tuesday - the 10th of November mid afternoon at three Vue Cinemas across the UK. For a standard adult ticket there is a £1.95 price variation for these cinemas. Doncaster (3pm) £4.75 Staines (4pm) £5.95 Greenwich O2 (4pm) £6.45 Fulham Broadway (4.30pm) £6.90 The later showing at Greenwich which restricts customers to Only 18s only will cost an adult £8.75 for a ticket. We’ve updated our revision presentation on Price Discrimination which is available below: Launch interactive revision presentation on Price Discrimination Download pdf of slide handouts Business Economics, Monopoly, Price Discrimination 2009-11-08T21:41:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/economics-in-the-news-quiz-10-november-2009/ http://www.tutor2u.net/blog/index.php/economics/comments/economics-in-the-news-quiz-10-november-2009/#When:21:20:00Z Launch interactive version of Economics in the News Quiz - 10 November 2009 Download printable pdf handout version Download SCORM-VLE import Economics in News Quiz 2009-11-08T21:20:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/great-examples-of-near-pure-monopolies/ http://www.tutor2u.net/blog/index.php/economics/comments/great-examples-of-near-pure-monopolies/#When:12:42:00Z A big hat tip to one of my students Arno Albici for spotting a superb article in the Economist about a cluster of mid-sized Japanese manufacturers who continue to enjoy near pure-monopoly power in highly specific, high value-added businesses. decades of industry expertise and reinvesting profit to fund high levels of research and innovation continue to give these companies a remarkable competitive strength in the market. The barriers to entry for rival manufacturers are very high and this helps to explain the limited contestability in the global marketplace. For example: Shimano earns around $1.5 billion a year by supplying 60-70% of the world’s bicycle gears and brakes YKK makes around half the world’s zip fasteners by value, 75% of motors for hard-disk drives in computers come from a firm called Nidec 90% of the micro-motors used to adjust the rear-view mirror in every car are made by Mabuchi “Many technology products have become commodities, but certain components have not, since they require continual innovation. So entry barriers to the business of making them remain high, and although the margins on the final goods have deteriorated, the margins on specialised, high-end components are still juicy.: Much more here A2 Micro, Business Economics, Monopoly, Economic Growth, Economics of Technology, Manufacturing Industry, Teaching of Economics 2009-11-07T12:42:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/us-jobless-figure-climbs-above-10-per-cent/ http://www.tutor2u.net/blog/index.php/economics/comments/us-jobless-figure-climbs-above-10-per-cent/#When:17:53:00Z It perhaps has a political significance greater than its marginal economic impact - but when one worker in ten is out of work, an economy truly is on the verge of mass unemployment. The US economy is showing signs of a rebound in demand and production but the labour market data continues to show the depth of the preceding slump. Over eight million Americans have now lost their job since the start of the recession in December 2007, with more than 15m Americans now out of work. Here are some links to coverage of this news. Guardian: US jobless rate hits 10% Independent: Sharp rise in US unemployment figures A2 Macro, AS Macro, Credit Crunch, Unemployment, US Economy 2009-11-06T17:53:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/cash-is-the-enemy-of-creativity/ http://www.tutor2u.net/blog/index.php/economics/comments/cash-is-the-enemy-of-creativity/#When:09:24:00Z The Founder and CEO of King of Shaves, Will King gave an engaging and dynamic presentation to a large audience of economics and business students at our Entrepreneurship Society last night. The UK sales figures for the new Azor razors are quite remarkable and are testimony to the impact that this challenger brand is having on a monopolistic/duopolistic market. In the past four weeks in the UK KoS has sold 107,000+ Azor system razor handles and 602,000+ Azor Endurium cartridges. Conventional MBA theory would suggest that the barriers to entry are just too high for a new firm to dislocate and disrupt the cosy market power of Gillette and Wilkinson Sword. The razor remains of the most patent protected products in the world and the billions of blades sold each year (at profit margin of over 90 per cent) represent an enormous cash cow for the US shaving giants. But easy cash can often stifle genuine creativity. The momentum of passionate and persistent challenger brands who truly understand the web and who talk to customers in a different way can make a big difference. The big Mo is with King of Shaves and it is easy to see why! Will reports on his visit here Our next meeting (Thursday 12th November) focuses on global economics and is with Paul Donovan, Chief Economist of UBS. Business Economics, Teaching of Economics 2009-11-06T09:24:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/caffeinated-stimulus-to-demand/ http://www.tutor2u.net/blog/index.php/economics/comments/caffeinated-stimulus-to-demand/#When:09:03:00Z Coffee shops seem - by and large - to be surviving the recession and, in many cases thriving. The number of independent coffee stores has grown by more than 7% in the last year. Across the country hundreds of new stores have opened. This doesn’t make coffee an inferior good - whose demand rises as real income falls. Instead there are stronger forces at work, for example the rise of the nomadic entrepreneur who prefers to work away from expensive offices. Hugh Pym provides an overview of the strength of retail coffee demand in this piece from BBC news. London has the highest concentration of coffee stores in the UK followed by Edinburgh. Not every brand is enjoying the same performance. Costa Coffe which has 974 stores in the UK has reported like-for-like sales growth yesterday of 2.5 per cent in the six months to the end of August. Caffè Nero, which has almost 400 UK outlets, is believed to be trading at a similar level to Costa, although Starbucks has like-for-like sales down by an estimated 4.5 per cent to 5 per cent in recent months. Brand fatigue in action. A2 Micro, AS Micro, Business Economics, Competitive Markets, Market Equilibrium and Price, Nature of Demand, Price Mechanism in Action 2009-11-06T09:03:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/tim-harford-at-the-keynes-society/ http://www.tutor2u.net/blog/index.php/economics/comments/tim-harford-at-the-keynes-society/#When:17:34:01Z We are delighted to have the Undercover Economist Tim Harford returning to the Keynes Society on Thursday 19th November at 8-45pm in Upper School. Hot on the heels of his hugely successful books The Undercover Economist and The Logic of Life, Tim has made a timely and swift return to the top of the book charts with Dear Undercover Economist: The Very Best Letters from the “Dear Economist” Column: The Undercover Economist Solves Life’s Everyday Mysteries and Problems. Tim’s ability to connect with his audience and make Economics appealing, relevant and thought provoking is well established - it should be another super evening. A warm welcome is extended to teaching colleagues. We are likely to be pretty full for this meeting so if you are coming and plan to bring some students.  Teaching of Economics 2009-11-05T17:34:01-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/paul-donovan-at-the-keynes-society/ http://www.tutor2u.net/blog/index.php/economics/comments/paul-donovan-at-the-keynes-society/#When:17:29:00Z On Thursday 12th September we are delighted to welcome Paul Donovan, Chief Economist of UBS to speak at the Keynes (Economics) Society. Paul is a very highly rated city economist and a tremendous speaker. It should be a terrific opportunity to take the pulse of where the global economy is at this crucial stage of the cycle and just fifteen months after the meltdown in financial markets. A warm welcome is extended to teaching colleagues for this meeting. Please if you would like to come and if you plan to bring some students along. The meeting starts at 8-45pm in the Egerton Room, Eton and lasts one hour. Teaching of Economics 2009-11-05T17:29:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/sub-prime-carbon-government-failure/ http://www.tutor2u.net/blog/index.php/economics/comments/sub-prime-carbon-government-failure/#When:11:02:00Z This will be a teaching topic I return to in the spring, but Radio 4 today carried an excellent report by Roger Harrabin from the BBC on criticisms of the EU’s carbon trading scheme. The report focuses on new research from Friends of the Earth that is highly critical of the emissions trading scheme. “FoE says most trades are done not by polluting industries, but by speculative traders packaging carbon credits into complex financial products similar to those which triggered the sub-prime mortgage crash.” More here from Friends of the Earth which included a link to their report (in pdf format). Here is the link to the Radio 4 discussion - CEO of the European Climate Exchange Patrick Birley and the author of the FOTE report, Sarah Jane Clifton, discuss the rise in the carbon trading market.  A2 Micro, AS Micro, Cost Benefit Analysis, Environmental Economics, European Economy, Government Intervention, Government Failure, Teaching of Economics 2009-11-05T11:02:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/judging-the-impact-of-qe/ http://www.tutor2u.net/blog/index.php/economics/comments/judging-the-impact-of-qe/#When:10:32:01Z The BBC carries this interesting video discussion with De Anne Julius about the impact of the Bank’s Quantitative Easing programme designed to support demand and lending in the UK economy. She emphasises the importance of gradually withdrawing the QE programme and she argues that the main effect of QE so far has been to hold down the interest rate on government debt (gilts) but that there is little evidence so far that QE has enabled a rise in lending to consumers and small businesses. The Indy’s Big Question looks at QE in their edition today. A2 Macro, AS Macro, Credit Crunch, Cycles and Shocks, Monetary Policy, Recession Watch!, UK Economy 2009-11-05T10:32:01-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/job-vacancy-economics-teacher-at-tonbridge-school/ http://www.tutor2u.net/blog/index.php/economics/comments/job-vacancy-economics-teacher-at-tonbridge-school/#When:10:02:00Z Thanks to Dr John Richards for letting us know about a new job vacancy for an Economics Teacher to join the successful department at Tonbridge School.  Details have just been put on the Tonbridge website here. Again, please don’t forget to mention that you heard about the job from tutor2u - it helps Tonbridge identify the source of applications. 2009-11-05T10:02:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/stimulating-times/ http://www.tutor2u.net/blog/index.php/economics/comments/stimulating-times/#When:18:19:00Z I was drawn to this very interesting graphic from the latest IMF report on the state of government (fiscal) finances in countries around the world.  A2 Macro, AS Macro, Credit Crunch, Cycles and Shocks, Fiscal Policy, Keynesian Economics, Teaching of Economics, UK Economy 2009-11-04T18:19:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/the-economists-new-clothes/ http://www.tutor2u.net/blog/index.php/economics/comments/the-economists-new-clothes/#When:16:04:00Z This superb article from Stephanie Flanders provides a great discussion in her Stephanomics blog on the discipline of Economics from the view of some big hitters including Scholes (of Black-Schole options fame); Charlie Bean (of Bank of England fame); Lord Skidelsky (of Keynes fame); and Thaler (of Nudge fame). 2009-11-04T16:04:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/investment-teacher-presentation/ http://www.tutor2u.net/blog/index.php/economics/comments/investment-teacher-presentation/#When:08:34:01Z This revision presentation is ideal for AS Macro students who wish to build their knowledge and understanding of the important topic of investment and its role in driving macroeconomic performance. The presentation stays clear of AD-AS or PPF diagrams as we cover this analysis next - I will post a second presentation on applying investment to the AD-AS framework sometime next week. Launch interactive presentation on the economics of investment Download printable pdf (slides) AS Macro, Cycles and Shocks, Aggregate Demand, Capital Investment, UK Economy 2009-11-04T08:34:01-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/unemployment-the-uk-labour-market-teacher-presentation/ http://www.tutor2u.net/blog/index.php/economics/comments/unemployment-the-uk-labour-market-teacher-presentation/#When:08:21:00Z This updated revision presentation examines the key issues involved with rising unemployment in the UK labour market.  It looks at new data on the causes and consequences of UK unemployment and also touches on the regional, gender and other differences in the experience of unemployment - there is a set of right up to date charts on these aspects. Launch interactive presentation on UK unemployment Download printable pdf version of the slides A2 Macro, AS Macro, Labour Economics, UK Economy, Unemployment 2009-11-04T08:21:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/job-vacancy-head-of-economics-at-oundle/ http://www.tutor2u.net/blog/index.php/economics/comments/job-vacancy-head-of-economics-at-oundle/#When:22:06:00Z We are always happy to support requests from colleagues to highlight relevant job vacancies - and here is a cracker.  There is a vacancy for Head of Economics at Oundle School… 2009-11-03T22:06:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/glaxosmithkline-and-pfizer-choose-to-collaborate-on-hiv-drugs/ http://www.tutor2u.net/blog/index.php/economics/comments/glaxosmithkline-and-pfizer-choose-to-collaborate-on-hiv-drugs/#When:20:34:00Z Here is an excellent highly relevant article on cooperative behaviour between oligopolistic giants. Two of the world’s biggest drugs companies GlaxoSmithKline and Pfizer have announced a plan to merge their HIV treatments in a joint venture. ViiV Healthcare is an attempt for both companies to limit the risks of costly races to find new profitable treatments for HIV/aids and give them an opportunity to counter the loss of the revenues as these companies lose patent protection and are open to competition from generic drug makers. It is a strong reminder of the very high fixed costs of research into new drugs; the long lead times between new drug development, testing and finally getting it to the market. And also the impact of the entry of generic drugs into markets once patent protection runs out. The new company has a 19% share of the global drugs market, in comparison to the Californian company Gilead’s 31%. Drug firms’ collaboration pools HIV treatments (Independent) IPO of HIV business is ‘up to shareholders’ (Telegraph) A2 Micro, Business Economics, Oligopoly, Teaching of Economics 2009-11-03T20:34:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/newsmap/ http://www.tutor2u.net/blog/index.php/economics/comments/newsmap/#When:18:06:00Z For those of you who are “visual learners” or have a predilection for seeing things visually rather than in a long list of text hyperlinks, (or indeed don’t have time or the inclination to spend time sifting through the plethora of news articles in any given day) this neat website offers a different way of catching up on the hot stories of the day. You can tweak the settings to focus on Business news from your particular country Quirky Trivia 2009-11-03T18:06:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/rbs-lloyds-sell-off/ http://www.tutor2u.net/blog/index.php/economics/comments/rbs-lloyds-sell-off/#When:17:51:00Z The UK market has fewer bank brands than most other countries and choice has fallen in recent years after the Spanish bank, Santander bought up Abbey, Alliance & Leicester and Bradford & Bingley, and Lloyds has taken over all of HBOS’s brands. However, as per a ruling from the European Commission, RBS will sell 318 branches while Lloyds will dispose of more than 600 branches over the next four years.  A2 Micro, Business Economics, Competitive Markets, Oligopoly, Government Intervention, Regulation 2009-11-03T17:51:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/economics-revision-workshops-december-2009-fulham-birmingham-manchester/ http://www.tutor2u.net/blog/index.php/economics/comments/economics-revision-workshops-december-2009-fulham-birmingham-manchester/#When:11:46:00Z The session titles for the popular AS & A2 Economics revision workshops in December 2009 are outlined below.  Each one-day workshop has a distinctive micro flavour (focusing on Unit 1 / Unit 3) of the three main Econ exam boards.  Bookings are still being taken, though I think we’re pretty much full for AS in London already - so please send your details in as soon as possible. Bookings can be made here AS Economics Workshop Session 1. Essential market mechanism Session 2. Core business economics Session 3. Market failure basics Session 4. Market failure extras Session 5. Government intervention Session 6. Success in AS Economics with great exam technique A2 Economics Workshop Session 1. Growth and objectives of firms Session 2. Economies & diseconomies of scale Session 3. Monopoly and oligopoly Session 4. Barriers to entry & contestable markets Session 5. Regulating markets Session 6. Mastering examination technique at A2 2009-11-03T11:46:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/johannes-huth-at-the-management-society/ http://www.tutor2u.net/blog/index.php/economics/comments/johannes-huth-at-the-management-society/#When:07:51:00Z Johannes Huth, Manager of KKR’s Operations in Europe will be speaking at our Management Society this Wednesday at 8-45pm in Upper School. His topic is “Mergers and Acquisitions”. A warm welcome is extended to all teaching colleagues who might want to come to the meeting. Teaching of Economics 2009-11-03T07:51:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/will-king-at-the-entrepreneurship-society/ http://www.tutor2u.net/blog/index.php/economics/comments/will-king-at-the-entrepreneurship-society/#When:07:49:00Z The Founder of King of Shaves Will King speaks at our Entrepreneurship Society this coming Thursday at 8-45pm in the Egerton Room. All student places have been taken but a warm welcome is extended to any teaching colleagues who might want to come to the meeting. Teaching of Economics 2009-11-03T07:49:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/john-eatwell-at-the-keynes-society/ http://www.tutor2u.net/blog/index.php/economics/comments/john-eatwell-at-the-keynes-society/#When:07:46:00Z Cambriddge economist Lord Eatwell is speaking at our Keynes Society this Thursday evening at 8-45pm in Upper School. Teaching colleagues who are in the vicinity and who might like to come are extended a warm welcome. Teaching of Economics 2009-11-03T07:46:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/flexible-taxation/ http://www.tutor2u.net/blog/index.php/economics/comments/flexible-taxation/#When:05:48:00Z A report in Monday’s Times examines the way in which local councils are trying to avoid increases in council tax bills over the next year. Focusing on London councils, it is expected that on average council tax bills will be frozen, with a number of councils actually reducing local tax bills for residents. This is due in part to low inflation, but also to the local elections in London which will take place next May acting as an incentive for councillors to reduce the burden on their electors.  A2 Macro, Fiscal Policy, Government Intervention, Standard of Living, UK Economy, Regional Economics 2009-11-03T05:48:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/perfect-competition-teacher-presentation/ http://www.tutor2u.net/blog/index.php/economics/comments/perfect-competition-teacher-presentation/#When:18:10:00Z This revised PowerPoint presentation will help take students through the model of perfect competition. Links within the presentation encourage students to explore further by accessing relevant blog posts and video resources. Launch interactive version of Perfect Competition presentation Download printable pdf version (slides) A2 Micro, Business Economics, Competitive Markets, Market Equilibrium and Price, Teaching of Economics 2009-11-02T18:10:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/super-cruisers-and-the-law-of-increased-dimensions/ http://www.tutor2u.net/blog/index.php/economics/comments/super-cruisers-and-the-law-of-increased-dimensions/#When:13:02:00Z Graphically illustrated in this short piece from the Telegraph! A2 Micro, AS Micro, Business Economics, Economies of Scale 2009-11-02T13:02:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/hot-wiring-the-brain-to-pay-off-more-debt/ http://www.tutor2u.net/blog/index.php/economics/comments/hot-wiring-the-brain-to-pay-off-more-debt/#When:11:01:01Z This report for Radio 4’s Money Box programme is a superb example of behavioural economics in action and in particular the anchoring effect. Researchers have found that by putting a small minimum required payment at the bottom of credit card statements, people’s brains are wired to pay less back than if no such minimum was posted. The result is that debt takes many years more to repay and the accumulated interest to the lender is naturally much higher. Offering low minimum repayments each month seems seems intuitively to benefit the borrower - making the servicing of debt appear more manageable on a month-by-month basis. But the anchoring effect in fact lifts the profits of finance houses. Anchoring describes the human tendency to rely to heavily or ANCHOR on a trait or piece of information in particular. Natural human nature is to rely to heavily on certain pieces of information and then adjust to that piece of information to account for other elements of the circumstance. When a price anchor is established for a product, it serves as a reference price for all similar products and substitutes. For example, when bread-makers were first introduced to consumers in the USA at a retail price of $275, consumers were not prepared to buy them. However, when a similar product was priced at $400, consumers flocked to buy the $275 bread-maker because they perceived it to be available at a bargain price. This was because their price anchor had shifted from $275 per bread-maker to $400. Anchoring a price for a good or service at a higher level helps to attract consumers to products priced below the level of the anchor. A2 Macro, A2 Micro, Behavioural Economics, Teaching of Economics 2009-11-02T11:01:01-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/ofwat-plans-to-turn-the-tap-on-water-company-prices/ http://www.tutor2u.net/blog/index.php/economics/comments/ofwat-plans-to-turn-the-tap-on-water-company-prices/#When:06:28:01Z The Times today has an interesting article on the power battle between the water industry regulator OFWAT and the regional monopoly providers such as Thames Water. It appears that a much tougher pricing regime is planned for the utilities leading to cuts in the real price of water supplies for consumers. “Every five years, Ofwat sets limits on prices that water companies in England and Wales can charge. For 2010-15, it has proposed that, before taking inflation into account, bills should be reduced for many customers, bringing the average annual water and sewerage bill down by 4 per cent from £344 to £330 by 2015. The water companies had wanted a £28 rise to fund their business plans.” OFWAT wants the utilities to invest more in in improving drinking water quality, cutting leakage levels and raise the number of metered households from 36 per cent to 50 per cent (in a bid to control water usage). But will imposing real price cuts help achieve this objective? The aim is to have a pricing regime that forces the utilities to raise productivity and cut out as many inefficiencies as possible. Water is a good example of where a strong regulator is needed because of the absence of competition - after all consumers can’t switch supplier if they are given a poor service. A2 Micro, Business Economics, Monopoly, Government Intervention, Regulation 2009-11-02T06:28:01-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/economics-in-the-news-quiz-2-november-2009/ http://www.tutor2u.net/blog/index.php/economics/comments/economics-in-the-news-quiz-2-november-2009/#When:20:57:00Z The first weekly Economics quiz after half-term.  Were you keeping up-to-date? Launch interactive version of Economics in the News 2 November 2009 Download printable pdf handout version Download SCORM-VLE import file Economics in News Quiz 2009-11-01T20:57:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/monopoly-and-entry-barriers-teacher-presentation/ http://www.tutor2u.net/blog/index.php/economics/comments/monopoly-and-entry-barriers-teacher-presentation/#When:18:41:00Z This updated presentation provides an overview of the role of barriers to entry in protecting the position of a monopolist. Launch interactive version of presentation Download pdf slide handouts A2 Micro, Business Economics, Competitive Markets, Monopoly 2009-11-01T18:41:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/guardians-world-economic-cycle-guide/ http://www.tutor2u.net/blog/index.php/economics/comments/guardians-world-economic-cycle-guide/#When:19:48:00Z This is a fascinating time for keeping up to speed with where regions and countries are in their business cycles. The UK seems to be one of the laggards - Stephanie Flanders explores some of the reasons here - whereas the USA is tentatively starting a recovery. And demand and output in many emerging market economies remains strong. Click here for the Guardian’s interactive guide to the world economic cycle. A2 Macro, AS Macro, Credit Crunch, Cycles and Shocks, Global Economy, Recession Watch!, UK Economy 2009-10-30T19:48:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/the-us-economy-rebounds-teacher-presentation/ http://www.tutor2u.net/blog/index.php/economics/comments/the-us-economy-rebounds-teacher-presentation/#When:13:58:00Z Here is a topical teacher presentation that provides a snapshot of, and commentary on key economic data from the US as the world’s largest economy starts to pick up from the depths of the recession. Many questions remain not least the durability of a recovery and the extent to which the US experiences a jobless recovery. Launch streamed, interactive version - US Economy Rebounds Download pdf handout of slides: Mark Mardell reports on the latest US economic data in this BBC news video. Hamish McRae also reports on the state of health of the US economy in this piece from the Independent. A2 Macro, AS Macro, Credit Crunch, Cycles and Shocks, Global Economy, Recession Watch!, US Economy 2009-10-30T13:58:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/ib-economics-improving-evaluation-skills/ http://www.tutor2u.net/blog/index.php/economics/comments/ib-economics-improving-evaluation-skills/#When:12:28:00Z Here is a streamed version of the presentation I gave to the Hong Kong CPD day, focusing on how IB Economics students can improve their evaluation skills: Improving Evaluation Skills A2 Macro, A2 Micro, Teaching of Economics 2009-10-30T12:28:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/tutor2u-in-hong-kong/ http://www.tutor2u.net/blog/index.php/economics/comments/tutor2u-in-hong-kong/#When:11:13:01Z Eye weary and groggy from some fine Cathay Pacific house red, I have just landed hot foot from Hong Kong where I was the guest of Sha Tin College and a meeting of the Economics and Business Teaching Group from the English Schools Federation in Hong Kong. The whistlestop tour was great fun and I must thank everyone there for their warm welcome and superb organisation, not least Paul Hoang and his colleagues who put on the two day student conference and CPD event at their fine school. I will be posting some of the materials used in the Economics and IB blogs in the coming days....once the red leaves my system. Teaching of Economics 2009-10-30T11:13:01-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/youth-unemployment-and-the-recession/ http://www.tutor2u.net/blog/index.php/economics/comments/youth-unemployment-and-the-recession/#When:14:35:00Z This is a video of the presentation by Danny Blanchflower at the RSA this week.  Labour Economics, Recession Watch!, UK Economy, Unemployment 2009-10-29T14:35:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/230-million-unemployed-worldwide-the-economic-and-social-fallout/ http://www.tutor2u.net/blog/index.php/economics/comments/230-million-unemployed-worldwide-the-economic-and-social-fallout/#When:14:27:00Z I was listening to BBC Business World today and came across this revealing and thoughtful interview on the global impact of the huge rise in joblessness. According to the UN’s International Labour Organisation, there are upwards of 230 million unemployed people on this planet, around seven per cent of the workforce. This is a figure set to rise sharply despite an upturn in the global economic cycle - for as we know, unemployment is a lagging indicator. It tends to turn around with a delay after demand and production has started to rise again. A2 Macro, AS Macro, Cycles and Shocks, Global Economy, Labour Economics, Unemployment 2009-10-29T14:27:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/development-economics-sharp-practices-in-international-trade/ http://www.tutor2u.net/blog/index.php/economics/comments/development-economics-sharp-practices-in-international-trade/#When:07:44:00Z A new interactive resource from OXFAM provides a thought-provoking introduction into some of the issues facing developing economies. Development Economics, International Trade 2009-10-29T07:44:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/economics-teachers-on-twitter-join-the-twibe/ http://www.tutor2u.net/blog/index.php/economics/comments/economics-teachers-on-twitter-join-the-twibe/#When:07:15:00Z Twitter is taking off as a means for keeping in touch with Economics - and now there is a dedicated Twitter Group for Economics Teachers.  If you are on Twitter, come along to the EconomicsTeacher Twibe and join your colleagues. Your Twitter feed is automatically added to the Twibe Page.  Teaching of Economics 2009-10-29T07:15:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/paul-mason-on-the-wall-street-crash/ http://www.tutor2u.net/blog/index.php/economics/comments/paul-mason-on-the-wall-street-crash/#When:23:31:00Z Paul Mason - BBC Newsnight’s Economics Editor - is running a series of reports this week to mark the 80th anniversary of the Wall Street Crash. They are likely to be superb and a great resource for students and teachers. Here are the links to Paul’s output. What caused the Wall Street Crash? (11 mins) How the crash changed everything (13 mins) Lessons of 1929 A2 Macro, AS Macro, Cycles and Shocks, Economic History, Global Economy, Keynesian Economics, Teaching of Economics, Pre-U Economics 2009-10-28T23:31:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/soros-launches-new-economic-think-tank/ http://www.tutor2u.net/blog/index.php/economics/comments/soros-launches-new-economic-think-tank/#When:17:59:00Z For many years the billionaire George Soros has been a trenchant critic of neo-liberal free market fundamentalism. He has developed his own theory of reflexivity - a variant on behavioural economics thinking - which stresses the importance of perceptions in markets and powerful feedback effects. The FT describes his theory as one where ‘ financial markets tend to influence perceptions of reality, which in turn feed back into markets.’ Now Soros has announced that he is putting $50m into a new think tank - the Institute for New Economic Thinking (INET) - one of the aims is a moving away from the dominance of high level mathematics in university courses (a seriously good move in my opinion) towards giving students stronger insights in behavioural traits and the importance of politics and history in driving how people operate in real markets. According to Soros “The (economic) dogma has lost touch with reality.” NET’s founding Advisory Board members include Nobel laureates George Akerlof (famous for his work on the market for lemons and asymmetric information) and Sir James Mirrlees, Michael Spence and Joseph Stiglitz, Willem Buiter (from the LSE) Ian Goldin (seen here giving a talk at TED) Charles Goodhart (creator of Goodhart’s law) Anatole Kaletsky (arch-contrarian from the Times) John Kay (from the FT) global economics experts Ken Rogoff and Jeffrey Sachs. Quite a powerful list of people - all of whom are never happy to accept the conventional wisdom. This is an economics think tank worth keeping a weather eye on. A2 Macro, AS Macro, Credit Crunch, Teaching of Economics 2009-10-28T17:59:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/new-series-of-bbc-earth-report-deforestation-and-externalities/ http://www.tutor2u.net/blog/index.php/economics/comments/new-series-of-bbc-earth-report-deforestation-and-externalities/#When:20:38:00Z BBC World’s Earth Report has just started a new series of reports and the first edition is a powerful programme on deforestation in Indonesia and the impact that this has on carbon emissions.  Across south east asia peat swamp forest is being drained to make way for oil palm or pulpwood trees. The destruction of tropical forests causes about 20 percent of global greenhouse gas emissions – more than the world’s entire transport sector – making tropical forest countries such as Indonesia, some of the biggest emitters of greenhouse gases in the world. Which incentives will be most effective in limiting the permanent damage of huge rates of deforestation and the costs of damaging burning trees? A2 Macro, AS Micro, Emerging Economies, Development Economics, Environmental Economics, Global Economy, Government Intervention, Government Failure, Market Failure, Externalities 2009-10-27T20:38:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/interactive-guide-to-selected-eu-economic-data/ http://www.tutor2u.net/blog/index.php/economics/comments/interactive-guide-to-selected-eu-economic-data/#When:10:56:00Z The Telegraph website has a useful interactive guide to a selection of data on member countries inside the European Union. Our chart shows indices for GDP and there is also information the allocation of EU spending by country, population size and density. European Economy, Single Market, Teaching of Economics, Pre-U Economics 2009-10-27T10:56:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/warning-businesses-at-risk-from-economic-recovery/ http://www.tutor2u.net/blog/index.php/economics/comments/warning-businesses-at-risk-from-economic-recovery/#When:19:26:00Z An excellent recent article in the ACCA magazine examines an interesting phenomenon - more businesses collapse at the beginning of a recovery than during the depths of a recession. Its all to do with working capital… A2 Macro, AS Macro, Business Economics, Cycles and Shocks, Aggregate Demand, Recession Watch!, UK Economy 2009-10-26T19:26:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/global-food-prices-and-the-terms-of-trade/ http://www.tutor2u.net/blog/index.php/economics/comments/global-food-prices-and-the-terms-of-trade/#When:11:55:00Z Agflation refers to a sustained increase in the general price of foodstuffs and in recent years we have become accustomed to seeing the prices of many basic staple products rising. The era of cheap food looks to be over for now on the back of significant demand-side factors, not least rising population levels, higher per capita incomes and speculative demand for foods as prices have become more volatile. Supply-side factors are also important in explaining strong inflation in food prices. Both sides of the market are discussed by Ambrose Evans-Pritchard in his column in the Telegraph today “Food will never be so cheap again” - plenty of applied microeconomics here in addition to the huge number of macroeconomic issues that the trend rise in food prices has caused. One of the big changes in a switch in the terms of trade away from food importers towards food exporters. But do higher food prices necessarily cause agricultural supply to expand? A2 Macro, AS Micro, Emerging Economies, Commodities Markets, Cycles and Shocks, Aggregate Supply, Demography, Development Economics, Global Economy, International Trade, Standard of Living 2009-10-26T11:55:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/the-dying-celtic-tiger/ http://www.tutor2u.net/blog/index.php/economics/comments/the-dying-celtic-tiger/#When:07:58:00Z The Irish Economy was a model highly regarded and eagerly sought by global leaders. The Irish government believed in the late 1990’s that they had found the model that was going to give sustainable economic growth and increased prosperity for all. This was all true until the gloabl economic crisis occured. The Irish Times featured an article on 7 Reasons Why Ireland Will Be Left Behind Post-Recession. This is a good read to start a debate about post recession economic consequences on different economies. A2 Macro 2009-10-26T07:58:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/13-fall-in-household-wealth-will-shape-any-2010-rebound/ http://www.tutor2u.net/blog/index.php/economics/comments/13-fall-in-household-wealth-will-shape-any-2010-rebound/#When:16:09:00Z One key reason to expect a more subdued recovery from the downturn is that the household sector in the UK has suffered a huge negative wealth effect over the last couple of years. Asset values have fallen but outstanding debts have not and it is this imbalance that will shape the nature of any rebound in consumer demand for goods and services even though the cost of borrowing is at unusually low levels. The National Institute has done some research on the negative shift in personal sector wealth and it is reported in this article in the Telegraph.  A2 Macro, AS Macro, Cycles and Shocks, Aggregate Demand, Consumer Spending, Recession Watch!, UK Economy 2009-10-25T16:09:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/peak-oil-theory-and-economic-implications/ http://www.tutor2u.net/blog/index.php/economics/comments/peak-oil-theory-and-economic-implications/#When:16:00:00Z There is a highly relevant article on the depletion of global oil reserves and how this might affect UK energy policy in the Telegraph. The article links to concepts such as the marginal cost of extraction of different oil fields and the viability of exploring for oil at different prices. “The timing of the global peak remains uncertain but the window is rapidly narrowing. Since 1993, the world has produced half as much oil as was produced in the preceding century and now uses as much oil as the UK has ever produced in only 10 months. On current estimates, we have used between 28pc and 56pc of recoverable conventional oil – with much of what remains being located in smaller fields in less accessible locations, or requiring “enhanced recovery” techniques to extract.” The rest of the article can be found here A2 Macro, Commodities Markets, Cycles and Shocks, Environmental Economics, Oil and Gas, Market Equilibrium and Price, Nature of Supply, UK Economy 2009-10-25T16:00:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/lessons-from-an-ad-man-superb-microeconomics/ http://www.tutor2u.net/blog/index.php/economics/comments/lessons-from-an-ad-man-superb-microeconomics/#When:11:58:00Z The wonderful Rory Sutherland wows the audience at the TED conference in Oxford with a superb sixteen minute talk on advertising and aspects of behavioural economics. It is an immensely watchable video that will allow you to discuss with your students concepts such as perceived value, symbolic value,intangible value, hedonic opportunity cost and some ideas for nudging personal behaviour in socially beneficial ways. We learn of the extraordinary value of placebos, the rebranding of the potato in Prussian Germany. That all value is subjective and that persuasion is better than compulsion. Some super examples too of Veblen Goods, price discrimination and how the framing of the Italian penalty points system for drivers in Italy has a different impact than for motorists in the UK. A2 Micro, AS Micro, Behavioural Economics, Business Economics, Teaching of Economics 2009-10-25T11:58:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/navigating-our-global-future-ian-goldin-at-ted/ http://www.tutor2u.net/blog/index.php/economics/comments/navigating-our-global-future-ian-goldin-at-ted/#When:10:04:00Z Ian Goldin speaking at the TED conference in Oxford in 2009. A short but deeply interesting talk about globalisation and some of the systemic risks and systemic shocks that are likely to become more virulent. A2 Macro, AS Macro, Economic Growth, Economics of Technology, Global Economy, Teaching of Economics, Pre-U Economics 2009-10-25T10:04:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/soaring-cocoa-prices-as-supply-fails-to-keep-pace-with-demand/ http://www.tutor2u.net/blog/index.php/economics/comments/soaring-cocoa-prices-as-supply-fails-to-keep-pace-with-demand/#When:07:45:00Z There is an excellent article in the Times today about the surge in the world price of cocoa. Cocoa prices have hit a 30-year high as poor weather threatens to drive the price of chocolate up again for Western consumers. Cocoa has reached $3,412 a tonne in New York as concerns deepened about demand outstripping supply for the first time since 1968. This is a really good article to use to consolidate students’ understanding of how shifts in supply and demand can lead to price volatility. And also the importance of price elasticity of demand and supply in shaping price changes. “The surge in price also indicates that cocoa is increasingly being used for financial investment rather than merely sold to industry” * What factors are limiting cocoa supply? * Why is demand from western economies rising - even though many are still in recession? * Will cocoa farmersd necessarily gain from higher world prices? AS Micro, Emerging Economies, Commodities Markets, Development Economics, GCSE Economics, Market Equilibrium and Price, Nature of Demand, Nature of Supply, Price Mechanism in Action, Price Volatility 2009-10-25T07:45:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/new-edition-of-etonomics-sept-09/ http://www.tutor2u.net/blog/index.php/economics/comments/new-edition-of-etonomics-sept-09/#When:05:16:00Z The latest edition of our school economics magazine Etonomics has just been published. There are articles on digital economics, the national lottery and behavioural economics, game theory and climate change, the future for world aviation, microfinance and the inevitability (or otherwise) of economic recessions.  A download can be requested here: A2 Macro, AS Macro, Teaching of Economics, Pre-U Economics 2009-10-25T05:16:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/chinas-growth-starts-to-climb-back-above-the-8-target/ http://www.tutor2u.net/blog/index.php/economics/comments/chinas-growth-starts-to-climb-back-above-the-8-target/#When:15:51:00Z China’s leaders have set ambitious targets for economic growth - with an aim of reaching 8% growth of real GDP in 2009, a year in which world trade has shrunk and much of the developed world has been mired in recession.  An enormous stimulus programme seems to be having an effect with the latest data showing a pick up in output and annualised growth of GDP climbing above 8.5%. Exports remain weak and many Chinese manufacturers are finding that the prices they are able to get from advanced economy importers continues to fall - the terms of trade have moved against them. Lifting domestic demand has become a key macroeconomic objective for the Chinese government. China has poured £354billion into spending on infrastructure in order to boost its domestic economy as exports have suffered. This BBC news video reports on the latest Chinese growth figures. See also BBC: China economic growth accelerates The Times: The dragon roars again after new figures put China’s output on a growth hat-trick A2 Macro, AS Macro, Emerging Economies, China Economy, Credit Crunch, Cycles and Shocks, Development Economics, Fiscal Policy, Global Economy, Recession Watch! 2009-10-24T15:51:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/broadband-and-economic-development/ http://www.tutor2u.net/blog/index.php/economics/comments/broadband-and-economic-development/#When:13:51:01Z Access to and the speed and reliability of broadband infrastructure is one of the key institutional factors that impact on economic development. The lack of an affordable and cost-effective broadband network can be a huge barrier to economic growth especially in an age where companies in many rich countries are looking to outsource their back office and call centre services to countries where operating costs are lowest. The 2009 UNCTAD Information Economy Report provides a wealth of background information on the global digital divide. According to the latest report, businesses and consumers are 200 times more likely to have access to broadband in developed countries than in the poorest Least Developed Countries (LDCs). And the monthly cost of broadband access varies to an incredible degree - from over $1,300 a month in Burkina Faso, the Central African Republic to less than $13 in Egypt. A2 Macro, Emerging Economies, Business Economics, Economies of Scale, Cycles and Shocks, Aggregate Supply, Development Economics, Economic Growth, Economics of Technology, Global Economy, International Trade, Standard of Living, Teaching of Economics 2009-10-24T13:51:01-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/rwanda-invests-in-connecting-the-young/ http://www.tutor2u.net/blog/index.php/economics/comments/rwanda-invests-in-connecting-the-young/#When:13:14:00Z A deeply encouraging and inspiring report from Rory Cellan Jones on the One Laptop per Child policy being rolled out in Rwanda - a policy that aims to equip 100,000 students with access to the internet. Are there more important priorities than building an IT infrastructure such as meeting people’s basic needs and wants? Or can technology transform the economy just fifteen years after the genocide?  A2 Macro, Development Economics, Economic Growth, Global Economy, Standard of Living, Supply-side policies, Teaching of Economics 2009-10-24T13:14:00-06:00 http://www.tutor2u.net/blog/index.php/economics/comments/human-development-index-for-2009/ http://www.tutor2u.net/blog/index.php/economics/comments/human-development-index-for-2009/#When:10:45:00Z The Economist chose the release of new data on the Human Development Index as the subject of its chart of the day - available here together with a short commentary. It would make an excellent chart to use as part of a teaching handout. “Mozambique has improved the most, scoring almost 50% higher in the 2007 index than it did in 1990. Many other African countries have also seen increases in their quality of life” More here from the United Nations Development Programme A2 Macro, AS Macro, Emerging Economies, Development Economics, Global Economy, Standard of Living, Teaching of Economics 2009-10-24T10:45:00-06:00