http://www.tutor2u.net/blog/index.php/economics/ en tutor2u.net Copyright 2012 2012-02-11T19:04:45+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/china-bans-its-airlines-from-paying-eu-carbon-tax http://www.tutor2u.net/blog/index.php/economics/comments/china-bans-its-airlines-from-paying-eu-carbon-tax#When:05:52:33Z On 1st January this year, the EU introduced an Emissions Trading Scheme (ETS) which levies a charge on flights in EU airspace based on carbon emissions. They estimate that this will add between 2 and 12 euros to flight tickets. Airlines are required to purchase emissions permits, like utilities and heavy industry in the EU, and airlines that do not comply face fines of 100 euros for each tonne of carbon dioxide emitted for which they have not surrendered allowances. In the case of persistent offenders, the EU has the right to ban airlines from its airports. A2 Micro, Emerging Economies, China Economy, Business Economics, Environmental Economics, European Economy, Government Intervention, Indirect Taxes, Market Failure, Externalities, Transport Economics, 2012-02-06T05:52:33+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/unit-4-macro-money-debt-and-the-new-world-order http://www.tutor2u.net/blog/index.php/economics/comments/unit-4-macro-money-debt-and-the-new-world-order#When:18:40:23Z “All money these days is really a form of debt from somewhere else. We know now in 2012 that our debts cannot be repaid in full.” Philip Coggan from the Economist was on fine form at the LSE last week when he spoke to a packed audience in the new academic building on the subject of his latest book. When trust in the monetary system breaks down we are in a very difficult place and, in a wonderfully broad historical sweep Philip Coggan offered some revealing insights into what a reformed global monetary system might look like in the years ahead. AS and A2 Specifications, AQA Economics Unit 4, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Macro, Emerging Economies, Cycles and Shocks, European Economy, The Euro, Financial Markets, Global Economy, Macroeconomic Policies, Monetary Policy, OECD Economies, Teaching of Economics, 2012-01-22T18:40:23+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/france-and-flexible-employment http://www.tutor2u.net/blog/index.php/economics/comments/france-and-flexible-employment#When:10:03:05Z This article could be useful as an illustration of the EU context in relation to employment in general, and flexible employment in particular. Attracting inward FDI is arguably a significant benefit of UK membership of the EU, and one of the advantages which the UK can offer compared to, say, France is relatively flexible employment laws. AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, EdExcel Economics Unit 2, EdExcel Economics Unit 4, A2 Macro, Business Economics, Competitive Markets, European Economy, Labour Market, Macroeconomic Policies, Supply-side policies, OECD Economies, French Economy, Teaching of Economics, 2012-01-22T10:03:05+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/unit-4-macro-russia-joins-the-wto http://www.tutor2u.net/blog/index.php/economics/comments/unit-4-macro-russia-joins-the-wto#When:09:50:52Z I am using Russia’s entry to the World Trade Organisation in my teaching on international trade and development this term. It appear to be a significant moment for the global economy. Russia is the last member of the Group of 20 major economies to join, after China gained membership in 2001. Progress towards membership has been delayed by numerous geo-political issues not least the disputes with neighbouring Georgia. Joining the WTO involves making a commitment to the rules of the international trade system - for Russia as with other new members, this will mean reduced import tariffs, the staged elimination of industrial domestic and export subsidies, and better greater access to foreign companies. Russia will also have to improve adherence to international accounting standards. * Russia’s average bound tariff will be 7.3 percent for manufactured products (compared with 9.5 percent currently) * Farm tariffs will be 10.8 percent (compared with 13.2 percent currently) * Russia commits to zero export subsidies on agricultural products - to end by 2017 * Russia will privatise 100 pct of United Grain Company by 2012 * Russia will introduce duty-free and quota-free provisions for the least developed countries * Russia will eliminate preferential tariffs for carmakers making large investments in Russian-based production by July 1, 2018 * Russia plans to introduce International Accounting Standards How would you use a supply and demand diagram to show the impact of a fall in an import tariff? Russian exports as a share of her GDP has actually been on a declining trend in recent years. Will movements towards trade and foreign investment liberalisation reverse this through trade creation and FDI effects? How can a stronger commitment to becoming an open economy supprot higher living standards over time? What are the risks for Russia of WTO accession? AS and A2 Specifications, AQA Economics Unit 4, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Macro, AS Macro, Emerging Economies, Development Economics, Russia Economy, Cycles and Shocks, Economic Growth, European Economy, Global Economy, International Trade, Macroeconomic Policies, Trade Policies, Oil and Gas, OECD Economies, Standard of Living, Teaching of Economics, 2012-01-22T09:50:52+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/unit-3-micro-the-economics-of-solar-subsidies http://www.tutor2u.net/blog/index.php/economics/comments/unit-3-micro-the-economics-of-solar-subsidies#When:22:15:53Z This blog provides a link to a new prezi presentation on the economics of solar subsidies - I have been using it as part of my teaching on aspects of environmental economics for Unit 3 AQA but it might also be useful for unit 1 market failure. I have kept theoretical diagrams out of it and plan to build up relevant analytical concepts such as economies of scale, consumer subsidies, economic and social welfare, government failure et al on a normal whiteboard rather than embed them into the Prezi. I hope it is useful. Follow the tags at the bottom of the blog entry for more recent articles on solar subsidies such as feed-in-tariffs and other environmental economic resources. AS and A2 Specifications, AQA Economics Unit 1, AQA Economics Unit 3, EdExcel Economics Unit 1, A2 Micro, AS Micro, Cost Benefit Analysis, Environmental Economics, European Economy, Government Intervention, Subsidies, Market Failure, Merit & De-Merit Goods, Market Equilibrium and Price, Nature of Demand, Nature of Supply, Price Mechanism in Action, Teaching of Economics, UK Economy, 2012-01-18T22:15:53+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/unit-4-macro-france-loses-her-aaa-credit-rating http://www.tutor2u.net/blog/index.php/economics/comments/unit-4-macro-france-loses-her-aaa-credit-rating#When:14:36:24Z It is perhaps a moment of more political than economic significance, but on Friday 13th January 2012 Standard and Poors, a leading credit rating agency announced that France was losing her triple A (AAA) credit rating for sovereign debt. It was part of a larger downgrading of government bonds among a sizeable chunk of Euro Zone countries, the argument being that plans to achieve deficit reduction lacked credibility. France was downgraded, S&P also lowered the long-term ratings on Austria, Malta, Slovakia, and Slovenia, by one notch. The rating levels for Cyprus, Italy, Portugal and Spain were dropped two notches. Here is a brief Channel 4 report on the news and some other links to the story. Only four Euro Zone countries now have an AAA rating. Do you know who they are? AS and A2 Specifications, AQA Economics Unit 4, EdExcel Economics Unit 4, A2 Macro, European Economy, The Euro, Global Economy, Credit Crunch, Teaching of Economics, UK Economy, 2012-01-15T14:36:24+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/unit-1-micro-low-cost-airlines-beat-the-recession http://www.tutor2u.net/blog/index.php/economics/comments/unit-1-micro-low-cost-airlines-beat-the-recession#When:20:57:39Z The global financial and economic crisis has created many problems for airlines - falling business and 1st class passenger revenues, increased insurance costs, problems in getting loan finance, volatile exchange rate and the challenges of steep increases in aviation fuel prices to name just a few. We could also add the shockwaves from the spring 2011 Japanese earthquake and tsunami, the Arab Spring and a decline in tourism, and the steadily deteriorating global economic outlook - with the Euro Zone crisis threatening a second recession for Western Europe. But discount airlines - carriers that offer no-frills and charge plenty for extras on top of low basic fares - seem to have fared pretty well despite the turbulent conditions. Many passengers now appear willing to sacrifice luxury for cheaper flights and there are plenty of news stories of low-cost airlines in Europe, Asia and Africa who are announcing expanded route maps for 2012 and beyond. What economic factors help explain the continued expansion of low-cost airline carriers? AS and A2 Specifications, AQA Economics Unit 1, EdExcel Economics Unit 1, AS Micro, Emerging Economies, Business Economics, European Economy, Global Economy, Transport Economics, 2012-01-01T20:57:39+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/spain-opts-for-more-austerity-in-2012 http://www.tutor2u.net/blog/index.php/economics/comments/spain-opts-for-more-austerity-in-2012#When:07:57:57Z Spain’s new government has said the public deficit for 2011 will be 8% of GDP, well above its target of 6%, and has announced increases in income and property tax along with a wage freeze for civil servants to tackle it.  Looks like a very tough year ahead for the Spaniards, one of several in the last few years,as illustrated in this timeline. European Economy, OECD Economies, Spain Economy, 2011-12-31T07:57:57+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/surveys-statements-and-predictions-for-2012 http://www.tutor2u.net/blog/index.php/economics/comments/surveys-statements-and-predictions-for-2012#When:16:22:45Z As one of many turn-of-the-year round-ups, the BBC has polled 34 ‘leading economists’ in the UK and EU to find out what they expect for the EU in 2012. Unfortunately this report of the results doesn’t give details, but says that25 of the 27 respondents expect recession to return to Europe next year, with many finding it fairly likely that the eurozone will break up, and 20% expecting that at least one member will leave during next year. A2 Macro, AS Macro, Economic Growth, European Economy, International Trade, Macroeconomic Policies, UK Economy, Recession Watch, 2011-12-30T16:22:45+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/european-economics-resources-on-the-cap http://www.tutor2u.net/blog/index.php/economics/comments/european-economics-resources-on-the-cap#When:19:47:30Z This blog entry will provide a regularly updated set of links to resources to the European Union’s Common Agricultural Policy and attempts to reform this contentious and complex system of farm support. Check below for suggested links AS and A2 Specifications, AQA Economics Unit 1, AQA Economics Unit 3, EdExcel Economics Unit 1, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Micro, AS Micro, Agriculture, Emerging Economies, Commodities Markets, European Economy, EU Farming and Fishing, Government Intervention, Buffer Stocks, Government Failure, OECD Economies, French Economy, Market Equilibrium and Price, Price Mechanism in Action, Teaching of Economics, UK Economy, Regional Economics, 2011-12-28T19:47:30+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/the-eurozone-crisis-explained-again http://www.tutor2u.net/blog/index.php/economics/comments/the-eurozone-crisis-explained-again#When:14:28:45Z A superb, relatively simple, explanation of the Eurozone debt crisis with good data on historical compliance to the ‘Stability and Growth Pact’. Plenty data for students to get their teeth into. How significant is the level of government debt? AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, EdExcel Economics Unit 2, EdExcel Economics Unit 4, OCR AS Economics Unit F582, A2 Macro, AS Macro, Economic History, European Economy, The Euro, Macroeconomic Policies, 2011-12-22T14:28:45+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/unit-3-micro-patent-wars-a-touchy-subject-for-apple http://www.tutor2u.net/blog/index.php/economics/comments/unit-3-micro-patent-wars-a-touchy-subject-for-apple#When:17:24:57Z This excellent news piece from Ben Cohen at Channel 4 looks at the increasingly aggressive patent war being fought by the manufacturers of the world’s leading mobile phone and tablet devices - the most profitable products in the digital economy. “Where once the giants (Google and Apple) competed on features, they now compete on patents.” The news feature looks in particular at the intellectual property surrounding the slide-screen technology used by millions to unlock a device. Apple claims the IP to this but a video tracked back to twenty years ago suggests that developers were already thinking of something remarkably similar long before the iPhone came into existence. Can the makers of Android defend legal claims from Apple that their IP has been infringed? And who will end up paying for the enormous legal fees and possible extra licencing costs?   AS and A2 Specifications, AQA Economics Unit 3, EdExcel Economics Unit 3, A2 Micro, Business Economics, Monopoly, Oligopoly, Economic Growth, Economics of Technology, European Economy, Single Market, Government Intervention, Regulation, Market Equilibrium and Price, Nature of Demand, Teaching of Economics, 2011-12-16T17:24:57+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/unit-4-macro-celebrating-ten-years-of-euro-notes-and-coins http://www.tutor2u.net/blog/index.php/economics/comments/unit-4-macro-celebrating-ten-years-of-euro-notes-and-coins#When:12:03:56Z The European Central Bank has just released a special six minute video celebrating the first ten years of the euro banknotes and coins! The new head of the ECB makes an appearance but does the video give enough time and emphasis to the structural problems and fault-lines of the system? And will the video become an interesting historical relic before we elect to use it in the classroom? Anyway…..here is the link AS and A2 Specifications, AQA Economics Unit 4, EdExcel Economics Unit 4, A2 Macro, European Economy, The Euro, Global Economy, Macroeconomic Policies, Teaching of Economics, 2011-12-02T12:03:56+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/bbc-interactive-graphic-eurozone-debt-who-owes-what-to-whom http://www.tutor2u.net/blog/index.php/economics/comments/bbc-interactive-graphic-eurozone-debt-who-owes-what-to-whom#When:16:34:05Z A great graphic from the BBC showing how much money is owed by each country to banks in other nations. The arrows point from the debtor to the creditor and are proportional to the money owed as of the end of June 2011. The colours attributed to countries are a rough guide to how much trouble each economy is in. European Economy, The Euro, 2011-11-18T16:34:05+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/unit-2-macro-should-the-eu-introduce-a-tobin-tax http://www.tutor2u.net/blog/index.php/economics/comments/unit-2-macro-should-the-eu-introduce-a-tobin-tax#When:00:42:14Z AS Economics student Freddie Bickford-Smith looks at some of the argument surrounding proposals to introduce a financial transactions tax in the EU. I will post another essay on this topic from a fellow student, offering an alternative perspective from that developed here! Following the financial crisis of the past few years, and the amassing of blame on the financial sector for it, it has come to the attention of many - including the European Commission - that there must be a way of rectifying the situation, and promoting greater economic stability. One popular suggestion is the ‘Tobin Tax’, an idea proposed by Professor James Tobin (the Nobel prize-winning American economist) for a tax on worldwide financial transactions AS and A2 Specifications, AQA Economics Unit 2, EdExcel Economics Unit 2, EdExcel Economics Unit 4, A2 Macro, AS Macro, European Economy, Financial Markets, Global Economy, Government Intervention, Indirect Taxes, Macroeconomic Policies, OECD Economies, Teaching of Economics, 2011-11-15T00:42:14+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/eurozone-crisis-a-selection-of-resources http://www.tutor2u.net/blog/index.php/economics/comments/eurozone-crisis-a-selection-of-resources#When:09:25:05Z How to deal with this in school? I cannot be the only teacher who is struggling to keep up with the eurozone developments myself, let alone help my students to make any sense of it. Some searching this morning has come up with a variety of articles, graphics and interviews which range from the very basic such as the one-minute video reports from Robert Peston, which might be helpful to an AS student who is just starting to get to grips with the principles of macroeconomics, to some analysis of actual and potential threats to the UK economy and graphics showing the interrelated borrowing between the eurozone countries, which might help the ambitious A2 students to stretch themselves. These are listed below, with a brief description of each one. I am sure that you will have many more to add to the list. A2 Macro, AS Macro, European Economy, Financial Markets, Macroeconomic Policies, OECD Economies, UK Economy, 2011-11-12T09:25:05+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/unit-1-micro-has-the-time-come-for-a-tobin-tax http://www.tutor2u.net/blog/index.php/economics/comments/unit-1-micro-has-the-time-come-for-a-tobin-tax#When:15:22:26Z This week I am setting my AS micro students a question on proposals for a Tobin Tax - partly because it is hugely topical and also as a way of developing their evaluation skills on paper and coming to a reasoned final conclusion. Here are some of the links to suggested reading and some video shorts on this topic: AS and A2 Specifications, AQA Economics Unit 1, AQA Economics Unit 2, EdExcel Economics Unit 1, EdExcel Economics Unit 2, AS Macro, AS Micro, European Economy, The Euro, Financial Markets, Global Economy, Government Intervention, Indirect Taxes, OECD Economies, Market Equilibrium and Price, Price Mechanism in Action, Teaching of Economics, 2011-11-06T15:22:26+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/global-economy-making-it-clear http://www.tutor2u.net/blog/index.php/economics/comments/global-economy-making-it-clear#When:05:15:06Z I have just come across this page on the BBC website which act as a portal, collecting together a variety of stories around a topic, and is therefore really useful to refer students to. It is listed as a Special Report; I am not sure if it is new or not so apologies if you have been aware of it for a long time already; however, if you have not, it seems worth highlighting here. AS and A2 Specifications, AQA Economics Unit 4, A2 Macro, AS Macro, Emerging Economies, European Economy, International Trade, Teaching of Economics, UK Economy, 2011-11-02T05:15:06+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/european-bailout-the-movie http://www.tutor2u.net/blog/index.php/economics/comments/european-bailout-the-movie#When:08:26:18Z Confused by what happened in Brussels?  Need an alternative explanation for the complexities of the European bank bailout?  then this short animated movie clip might help… A2 Macro, European Economy, 2011-10-29T08:26:18+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/world-collapse-explained-in-3-minutes http://www.tutor2u.net/blog/index.php/economics/comments/world-collapse-explained-in-3-minutes#When:21:16:43Z A nice summary of the world economy situation…... compressed into three minutes .... click on the You Tube link below AS and A2 Specifications, AQA Economics Unit 4, EdExcel Economics Unit 4, A2 Macro, AS Macro, European Economy, The Euro, Global Economy, Credit Crunch, Teaching of Economics, 2011-10-17T21:16:43+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/can-the-invisible-hand-solve-africas-poverty http://www.tutor2u.net/blog/index.php/economics/comments/can-the-invisible-hand-solve-africas-poverty#When:21:51:10Z At last night’s Senior Economics Society at Oundle we had a riveting talk by Hywel Rees-Jones, Managing Director of CDC, which covered so many areas of the issues of development economics. The talk was entitled “Can the invisible hand solve poverty in Africa?” Whilst conceding that some of the statements were broad generalisations across a variegated continent, Hywel discussed some of the key issues facing Africa. AS and A2 Specifications, AQA Economics Unit 4, EdExcel Economics Unit 4, A2 Macro, AS Macro, Emerging Economies, African Economy, Development Economics, China Economy, Commodities Markets, Economic Growth, Environmental Economics, European Economy, Global Economy, Government Intervention, International Trade, Manufacturing Industry, OECD Economies, Teaching of Economics, 2011-10-13T21:51:10+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/unit-3-micro-science-cities-and-external-economies-of-scale http://www.tutor2u.net/blog/index.php/economics/comments/unit-3-micro-science-cities-and-external-economies-of-scale#When:12:14:59Z This feature article from the BBC web site is essentially about the vital importance of high-knowledge industries in sustaining competitiveness and growth in a globalising world. Europe lags behind many emerging countries in terms of the resources devoted to science and technology, research and development and creative industries in particular. But the article makes reference to the expansion of science cities - knowledge clusters that bring together higher education expertise and entrepreneurial zeal - their number continues to grow from California and Boston in the USA, Cambridge in the UK, Education City in Qatar, Science City in Zurich and Digital Media City in Seoul. All good examples to use of the commercial leverage from external economies of scale in high-tech industries. AS and A2 Specifications, AQA Economics Unit 3, EdExcel Economics Unit 3, A2 Micro, Emerging Economies, Business Economics, Economies of Scale, Economic Growth, Economics of Technology, European Economy, Single Market, Global Economy, International Trade, Macroeconomic Policies, Supply-side policies, Manufacturing Industry, Teaching of Economics, UK Economy, 2011-09-29T12:14:59+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/greek-debt-decision-tree http://www.tutor2u.net/blog/index.php/economics/comments/greek-debt-decision-tree#When:12:16:00Z I have been looking for resources to use with my A2 students to investigate the Greek debt crisis, and why it is causing such global concern. So first I am really grateful to find the powerpoint that Geoff has posted to the blog this morning, which sets out the scale of the problem there very clearly. I would like to suggest another resource I have just come across which I think complements the powerpoint quite well - especially to help answer the question “What will happen if the Greeks do default?”. Someone at the BBC has devised a decision tree looking at possible outcomes which depend on how the Greek authorities respond to their “Troika” of lenders - the European Union, International Monetary Fund and European Central Bank. The potential outcomes range from a pyrrhic victory in which Greece forces its lenders to write off most of its debts, but bankrupts it’s banks, to global meltdown. What the decision tree doesn’t include is probablilites for each outcome. That could be the class activity for the week, perhaps. AS and A2 Specifications, AQA Economics Unit 4, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Macro, European Economy, The Euro, Global Economy, IMF, OECD Economies, Greece Economy, 2011-09-25T12:16:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/unit-4-macro-greek-economy-at-defaults-door http://www.tutor2u.net/blog/index.php/economics/comments/unit-4-macro-greek-economy-at-defaults-door#When:10:50:00Z A2 level economists studying macroeconomics are almost certainly going to be discussing the economics of a Greek government default in the coming days and weeks. Many of the main macro indicators for Greece have been heading in the wrong direction for some time and the country provides a rich opportunity to study the causes and consequences of a fiscal, economic and wider social crisis. I haave put together a slide presentation of ten key macroeconomic charts for Greece. Students and teachers might want to use this (and edit / improve) when discussing events as they occur in the days ahead. AS and A2 Specifications, AQA Economics Unit 4, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Macro, European Economy, The Euro, Global Economy, IMF, OECD Economies, Greece Economy, 2011-09-25T10:50:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/unit-2-macro-greece-on-the-brink-of-default http://www.tutor2u.net/blog/index.php/economics/comments/unit-2-macro-greece-on-the-brink-of-default#When:10:40:00Z AS level economists studying macroeconomics are almost certainly going to be discussing the economics of a Greek government default in the coming days and weeks. Many of the main macro indicators for Greece have been heading in the wrong direction for some time and the country provides a rich opportunity to study the causes and consequences of a fiscal, economic and wider social crisis. I haave put together a slide presentation of ten key macroeconomic charts for Greece. Students and teachers might want to use this (and edit / improve) when discussing events as they occur in the days ahead. AS and A2 Specifications, AQA Economics Unit 2, EdExcel Economics Unit 2, AS Macro, Cycles and Shocks, European Economy, The Euro, Global Economy, IMF, OECD Economies, Greece Economy, Teaching of Economics, 2011-09-25T10:40:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/unit-2-macro-human-development-index-hdi http://www.tutor2u.net/blog/index.php/economics/comments/unit-2-macro-human-development-index-hdi#When:20:41:00Z The Human Development Index (HDI) forms part of the annual human development report and is a composite measure of economic and social welfare that has three main components. At its most basic it focuses on longevity, basic education and minimal income and progress made by countries in improving these three outcomes. The inclusion of education and health indicators is a sign of successful government policies in providing access to important merit goods such as health care, sanitation and education. 1. Knowledge: First an educational component made up of two statistics – mean years of schooling and expected years of schooling 2. Long and healthy life: Second a life expectancy component is calculated using a minimum value for life expectancy of 25 years and maximum value of 85 years 3. A decent standard of living: The final element is gross national income (GNI) per capita adjusted to purchasing power parity standard (PPP) “Human development is the expansion of people’s freedom to live long, healthy and creative lives; to advance other goals they have reason to value; and to engage actively in shaping development equitably and sustainably on a shared planet. People are both the beneficiaries and the drivers of human development, as individuals and in groups” Source: HDR Report, November 2010 AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, EdExcel Economics Unit 2, EdExcel Economics Unit 4, A2 Macro, AS Macro, Emerging Economies, Development Economics, Economic Growth, European Economy, Global Economy, International Trade, 2011-09-13T20:41:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/a-gloomy-outlook-for-the-global-economy http://www.tutor2u.net/blog/index.php/economics/comments/a-gloomy-outlook-for-the-global-economy#When:10:15:00Z Some excellent data and analysis in today’s OECD Interim Economic Assessment.  The overall picture is pretty gloomy - certainly for the US and European economies.  As the press release states; “Economic recovery appears to have come close to a halt in the major industrialised economies, with falling household and business confidence affecting both world trade and employment, according to new analysis from the OECD” AS and A2 Specifications, AQA Economics Unit 4, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Macro, European Economy, Global Economy, OECD Economies, 2011-09-08T10:15:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/eurozone-macroeconomics-for-9-year-olds-brick-by-brick http://www.tutor2u.net/blog/index.php/economics/comments/eurozone-macroeconomics-for-9-year-olds-brick-by-brick#When:16:47:00Z It’s time to start treating our A2 economics students like 9 year-olds…in a kind-hearted way.  How?  With this highly creative and engaging piece of analysis by the market analysts at JP Morgan. The Eurozone crisis is both political AND economic, with the underlying issue one of who pays the bill for nation and bank bailouts.  The political impasse in Europe over the crisis is difficult to understand.  But this Lego-inspired graphic does a pretty good job of explaining who wants what. Follow the commentary underneath the graphic to hear the story. Hand it out to your A2 students and see if they can make sense of it. AS and A2 Specifications, AQA Economics Unit 4, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Macro, European Economy, OECD Economies, French Economy, German Economy, Greece Economy, Ireland Economy, Spain Economy, 2011-09-07T16:47:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/keynes-vs-hayek-how-to-solve-an-economic-crisis http://www.tutor2u.net/blog/index.php/economics/comments/keynes-vs-hayek-how-to-solve-an-economic-crisis#When:07:42:00Z As major economies are buffeted by crisis again, the excellent Keynes vs Hayek debate held at the LSE last month is thrown into ever sharper context. You can hear the 30-minute radio programme made from the debate here on BBC i-player, or download it as a podcast. There is also an article here introducing the opposing arguments, which students could use in September to analyse the changes to the global economic situation - no doubt there are still many twists and turns to come in the next month for them to work with. Cycles and Shocks, European Economy, Financial Markets, Government Intervention, Macroeconomic Policies, Monetarism, Teaching of Economics, UK Economy, Recession Watch, 2011-08-08T07:42:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/the-euro-crisis-time-for-a-song http://www.tutor2u.net/blog/index.php/economics/comments/the-euro-crisis-time-for-a-song#When:20:29:00Z As we enter a period of significant uncertainty and danger for the global economy, let’s pause to enjoy this musical interlude inspired by the crisis gripping the euro zone… European Economy, Global Economy, 2011-07-20T20:29:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/unit-3-micro-oligopsony-dairy-losses-drive-farmers-from-the-fields http://www.tutor2u.net/blog/index.php/economics/comments/unit-3-micro-oligopsony-dairy-losses-drive-farmers-from-the-fields#When:21:43:00Z Hats off to the herd! Milk production in the UK is expanding yet many dairy farmers have or are likely to leave the industry over the next five years unless raw milk production becomes more economically viable. Can the stakeholders in the sector reach fresh agreement on sustainable contracts for the near 40 million litres of milk produced every day? AS and A2 Specifications, AQA Economics Unit 3, EdExcel Economics Unit 3, A2 Micro, AS Micro, Agriculture, Business Economics, Economies of Scale, Oligopoly, European Economy, EU Farming and Fishing, Government Intervention, Market Equilibrium and Price, Nature of Demand, Nature of Supply, Price Mechanism in Action, Teaching of Economics, UK Economy, Regional Economics, 2011-07-10T21:43:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/global-economy-increased-risk-of-future-shocks http://www.tutor2u.net/blog/index.php/economics/comments/global-economy-increased-risk-of-future-shocks#When:07:05:00Z A new OECD report on the risks of external shocks to the global economy looks like being really useful for teachers preparing fresh materials for their courses. “The interconnectedness of the global economy makes it more vulnerable to major shocks…...these shocks include cyber attacks, pandemics, geomagnetic storms, social unrest and financial crises.” The report can be downloaded here. AS and A2 Specifications, AQA Economics Unit 4, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Macro, AS Macro, Emerging Economies, Business Economics, Management Issues, Cycles and Shocks, Aggregate Demand, Aggregate Supply, Environmental Economics, European Economy, Global Economy, Credit Crunch, Government Intervention, Macroeconomic Policies, OECD Economies, Teaching of Economics, UK Economy, 2011-06-28T07:05:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/as-micro-fears-over-a-century-of-hunger http://www.tutor2u.net/blog/index.php/economics/comments/as-micro-fears-over-a-century-of-hunger#When:08:19:00Z Nigel Cassidy reports in this video from BBC news on fears that the world faces “a century of hunger” if the international community cannot agree on new rules regarding food prices. Food security is a hugely important global economic, political and social issue and one of the best resources for keeping up to speed on this is the Guardian’s dedicated page of articles. Here is the link. Check the links at the bottom of the blog for past articles on this topic. AS and A2 Specifications, AQA Economics Unit 1, AQA Economics Unit 4, EdExcel Economics Unit 1, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Macro, AS Micro, Agriculture, Emerging Economies, Development Economics, Commodities Markets, Cycles and Shocks, Economic Growth, European Economy, EU Farming and Fishing, Global Economy, Government Intervention, Buffer Stocks, International Trade, Poverty and Inequality, Market Equilibrium and Price, Price Mechanism in Action, Price Volatility, Standard of Living, Teaching of Economics, 2011-06-22T08:19:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/oceans-at-grave-risk http://www.tutor2u.net/blog/index.php/economics/comments/oceans-at-grave-risk#When:19:28:00Z The tragedy of the commons and the grave consequences for the state of marine ecology are highlighted in this new report. Covered with passion in this blog. Climate change, pollution and over-fishing are two fundamental problems for the oceans. More details here from the International Programme on the State of the Ocean (IPSO) website. The report identifies a number of important policy approaches to tackle the problems - The scientists say that the ‘precautionary principle’ must be used in terms of oceanic impacts, in other society shouldn’t don’t proceed with activities unless they are proven to be largely safe for marine ecosystems.  And they argue for much stringer use of property rights by widening the size of international marines of the sea. TED Talk: Jeremy Jackson: How we wrecked the ocean   AS and A2 Specifications, AQA Economics Unit 1, AQA Economics Unit 3, EdExcel Economics Unit 1, EdExcel Economics Unit 4, A2 Micro, AS Micro, Emerging Economies, Cost Benefit Analysis, Environmental Economics, European Economy, EU Farming and Fishing, Global Economy, Government Intervention, Market Failure, Teaching of Economics, 2011-06-20T19:28:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/econ4-context http://www.tutor2u.net/blog/index.php/economics/comments/econ4-context#When:19:13:00Z Geoff’s blog about ECON4 (see below) is fantastic advice, and I hope that my A2 students will spend much of the next 2 days working their way through it, checking they are secure in their knowledge of the topics he has identified, and can apply them to the context areas suggested there. If they have finished all that, and want yet more up-to-date evidence there is plenty in the news in the last few days. AS and A2 Specifications, AQA Economics Unit 4, A2 Macro, Emerging Economies, China Economy, Commodities Markets, Cycles and Shocks, European Economy, International Trade, Macroeconomic Policies, OECD Economies, Standard of Living, UK Economy, 2011-06-20T19:13:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/do-you-agree-that-the-government-should-provide-support-to-the-uk-car-indus http://www.tutor2u.net/blog/index.php/economics/comments/do-you-agree-that-the-government-should-provide-support-to-the-uk-car-indus#When:09:25:00Z This is a fairly classic A2 macroeconomics question, and one that the European Automobile Manufacturers Association has been considering at their meeting in London last week. Their conclusion? That non-European governments should scale back assistance for their own automotive industries, but at the same time governments in Europe should support the industry’s efforts to cut car emissions. A2 Macro, Emerging Economies, Business Economics, Competitive Markets, European Economy, Government Intervention, Subsidies, Macroeconomic Policies, Supply-side policies, Manufacturing Industry, 2011-06-12T09:25:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/a2-micro-economies-of-scale-in-solar-power http://www.tutor2u.net/blog/index.php/economics/comments/a2-micro-economies-of-scale-in-solar-power#When:10:22:30Z How about this for economies of scale in the renewable energy industry? A new photovoltaic park has opened in Les Mées in France, By the end of 2011, solar panels will cover 200 hectares and produce around 100MW, making it the biggest solar array in France. AS and A2 Specifications, AQA Economics Unit 3, EdExcel Economics Unit 3, A2 Micro, Business Economics, Economies of Scale, Economic Growth, Economics of Technology, Environmental Economics, European Economy, Single Market, Market Failure, Merit & De-Merit Goods, Market Equilibrium and Price, Nature of Supply, Teaching of Economics, 2011-05-27T10:22:30+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/aqa-a2-economics-european-context http://www.tutor2u.net/blog/index.php/economics/comments/aqa-a2-economics-european-context#When:15:37:00Z Each of the AQA a2 economics papers contains data response questions where understanding and awareness of the context of the economics of the European Union comes into play. We have a EU Economy in Focus study companion which is published in updated form each year. Details are available here. One area for revision focuses on the analysis diagrams that might be used to support your answers to EU context questions, I have put together a listing of topic areas where a diagrammatic approach might pay dividends - it is not exhaustive of course, merely some suggestions that might be useful. It appears below: AS and A2 Specifications, AQA Economics Unit 3, AQA Economics Unit 4, A2 Macro, A2 Micro, European Economy, EU Enlargement, EU Farming and Fishing, Single Market, The Euro, OECD Economies, Teaching of Economics, 2011-05-23T15:37:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/comparing-the-uk-with-europe http://www.tutor2u.net/blog/index.php/economics/comments/comparing-the-uk-with-europe#When:07:55:00Z Stephanie Flanders has posted a very useful blog examining Eurozone growth, and whether the UK can best be compared to France and Germany or to Greece, Portugal and Spain. She starts with Ed Balls rejection of the Chancellor’s habit of likening the position of the UK economy to those of the southern states which are struggling so badly at present; the Shadow Chancellor believes a better comparison would be with our traditional competitors in northern Europe. AS and A2 Specifications, AQA Economics Unit 3, AQA Economics Unit 4, A2 Macro, Balance of Payments, European Economy, International Trade, OECD Economies, French Economy, German Economy, Spain Economy, Teaching of Economics, UK Economy, 2011-05-14T07:55:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/a2-macro-chinese-investment-in-the-eu http://www.tutor2u.net/blog/index.php/economics/comments/a2-macro-chinese-investment-in-the-eu#When:13:23:00Z There is much focus on Chinese foreign direct investment in Africa and Latin America - China is also making huge investments in Australia as my friend Mark Johnston writes about in this blog. Here Euro News looks at investment in the European Union by Chinese owned businesses. New motorways in Poland ahead of the 2012 European Football Championships, co-financed by the EU, are being built by Chinese companies. The Chinese are also buying up public debt, in Greece, Spain and Portugal. AS and A2 Specifications, AQA Economics Unit 4, EdExcel Economics Unit 4, A2 Macro, Emerging Economies, China Economy, Cycles and Shocks, Aggregate Supply, Economic Growth, European Economy, EU Enlargement, Single Market, Global Economy, Macroeconomic Policies, Supply-side policies, OECD Economies, Poland, Teaching of Economics, 2011-05-03T13:23:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/eu-enlargement-evaluating-the-impact http://www.tutor2u.net/blog/index.php/economics/comments/eu-enlargement-evaluating-the-impact#When:17:01:00Z Many of Europe’s newer member states have outperformed established EU countries since they joined the single market in 2004 and 2007. And as a result there has been a process of convergence in average living standards and improved employment opportunities. Europe’s new nations have injected extra dynamism into the region despite inevitable teething problems along the way. For students revising aspects of EU enlargement here is a streamed version of a presentation I gave to a Tutor2u event in London a few weeks ago A streamed version of the presentation is available here PDF Handout of the presentation Related news issues Germany expects influx of Polish workers (BBC news, April 2011)   AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, EdExcel Economics Unit 2, EdExcel Economics Unit 4, A2 Macro, AS Macro, European Economy, EU Enlargement, Labour Market, OECD Economies, French Economy, German Economy, Greece Economy, Ireland Economy, Poland, Spain Economy, Teaching of Economics, UK Economy, 2011-04-30T17:01:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/a2-micro-eu-aviation-state-aid-and-state-ownership http://www.tutor2u.net/blog/index.php/economics/comments/a2-micro-eu-aviation-state-aid-and-state-ownership#When:16:48:00Z I have put together a short revision exam-style question for AQA Unit 3 (Micro) focusing on some of the issues / problems facing the European Airline industry. Many of the established airlines are part-state owned and the question of nationalisation, government emergency funding / state aid was highly topical this time last year in the wake of the recession and the volcanic ash crisis. The document can be downloaded below and I have linked also to some other A2 micro revision resources EU_Airlines_State_Aid_Nationalisation.pdf AS and A2 Specifications, AQA Economics Unit 3, EdExcel Economics Unit 3, A2 Micro, Business Economics, European Economy, Single Market, Government Intervention, Subsidies, Teaching of Economics, Transport Economics, 2011-04-28T16:48:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/the-economic-social-benefits-of-migration http://www.tutor2u.net/blog/index.php/economics/comments/the-economic-social-benefits-of-migration#When:19:56:00Z My own students know that I am strongly in favour of open migration and oppose the government’s attempts to impose artificial caps on economic migrants from outside of the EU. A hat tip to Philippe Legrain for spotting this article from today’s Guardian which is heavily tilted towards the longer-term economic and social benefits of migrants for the UK economy. So David Cameron wants to talk about immigration? Bring it on As a partial counter-balance perhaps I should link you towards a piece in the Daily Mail by Andrew Green: Why is the BBC STILL so hideously biased on immigration?  I have also linked below to some of our recent blogs on the migration issue. And here is a link to a presentation on the enlargement of the EU that I gave in London back in February 2011. AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, EdExcel Economics Unit 2, EdExcel Economics Unit 4, A2 Macro, AS Macro, Cycles and Shocks, Aggregate Supply, European Economy, EU Enlargement, Labour Market, Standard of Living, Teaching of Economics, UK Economy, 2011-04-16T19:56:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/externalities-of-nitrogen-pollution-in-europe http://www.tutor2u.net/blog/index.php/economics/comments/externalities-of-nitrogen-pollution-in-europe#When:11:25:00Z Roger Harrabin reports on fresh research on the impact of air pollution on Europe’s natural habitats. A classic example of negative externality effects - already targeted by the EU natural habitat directive, but a regulation that appears to be ineffective. “Earlier this week, the European Nitrogen Assessment - the first of its kind - estimated nitrogen damage to health and the environment at between £55bn and £280bn a year in Europe, even though nitrogen pollution from vehicles and industry had dropped 30% over recent decades.” More here: Nitrogen pollution ‘costs EU up to £280bn a year’ The report can be accessed here   AS and A2 Specifications, AQA Economics Unit 1, AQA Economics Unit 3, EdExcel Economics Unit 1, A2 Micro, AS Micro, Agriculture, Cost Benefit Analysis, Environmental Economics, European Economy, Government Intervention, Regulation, Market Failure, Externalities, Teaching of Economics, 2011-04-16T11:25:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/soap-powder-cartel-leaves-stain-on-colluders http://www.tutor2u.net/blog/index.php/economics/comments/soap-powder-cartel-leaves-stain-on-colluders#When:20:30:00Z The EU Competition Commission got into a LATHER about alleged price fixing by a number of multinational soap and washing powder producers and in a ruling today they have imposed fines on Unilever and Procter & Gamble €315.2m ($456m) for fixing washing powder prices in eight countries within the single market. An investigation was prompted by whistle-blowing from Henkel, a German competitor (manufacturer of Persil) and so the investigation CYCLE began. Unilever was fined €104m and Procter & Gamble was fined €211.2m. Henkel was not WHITER THAN WHITE but under EU cartel rules, it avoided a hefty fine because of alerting the authorities to the price fixing scheme. AS and A2 Specifications, AQA Economics Unit 1, AQA Economics Unit 3, EdExcel Economics Unit 1, EdExcel Economics Unit 3, A2 Micro, AS Micro, Business Economics, Oligopoly, Competition Policy, European Economy, Single Market, Market Failure, Teaching of Economics, 2011-04-13T20:30:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/ocr-f585-june-2011-a-brain-drain-from-spain http://www.tutor2u.net/blog/index.php/economics/comments/ocr-f585-june-2011-a-brain-drain-from-spain#When:08:15:00Z High unemployment, declining real wages and worsening employment prospects might be causing a surge in net migration out of the Spanish economy.  The economic and social consequences of high unemployment figures prominently in the OCR F585 stimulus material for the June 2011 exam. One in five under the age of 30 in Spain is unemployed, and a staggering 64% of those age 16 to 19 are unemployed. Youth unemployment rates in Spain are higher than both Egypt and Tunisia Official data shows that 118,000 people left the country in the two years to April 2010 - many of them heading to Germany where economic growth is strong and unemployment rates are falling. There is also growing evidence of younger Spaniards heading to Latin America. 30,000 Spaniards moved to Argentina between June 2009 and November 2010 — an 11 per cent increase over that period. Some 6,400 went to Chile — a jump of 24 per cent in the same timeframe — and 6,800 headed for Uruguay, an increase of 16 per cent. If the brain drain effect gathers momentum consider some of the possible consequences for the Spanish economy. Canadian Press: Portuguese, Spaniards seek new lives in old colonies as they face dead-end future at home Spanish jobless level hits another record high (April 29th)   AS and A2 Specifications, OCR A2 Economics Unit F585, European Economy, OECD Economies, Spain Economy, 2011-04-13T08:15:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/focus-on-irelands-economy http://www.tutor2u.net/blog/index.php/economics/comments/focus-on-irelands-economy#When:12:46:00Z Ireland is an economy suffering an economic, financial and political crisis. Her freedom to operate an independent macroeconomic policy is constrained by her membership of the single European currency and there are many who doubt that Ireland will be able to achieve a sustained recovery without some form of debt default. Our charts below track some of the key macroeconomic indicators for the Irish economy and below them we have gathered together recent blogs on Irish economic issues. AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, EdExcel Economics Unit 2, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Macro, AS Macro, European Economy, The Euro, OECD Economies, Ireland Economy, 2011-04-12T12:46:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/a2-macro-back-to-roubini-a-year-on http://www.tutor2u.net/blog/index.php/economics/comments/a2-macro-back-to-roubini-a-year-on#When:18:51:00Z Almost a year ago I headed to the LSE to hear Nouriel Roubini launch a new book “Crisis Economics”. The notes that I took at the time are reprised below and reading through them again, I am struck by just how accurate the Roubini assessment was of where the next phase of the financial and economic crisis would move. Many of the remarks are relavant to students preparing for the OCR F585 paper for June 2011 and also for other A2 macro students wanting some evaluative comments on the international economic crisis. I have repeated my comments from the May 2010 blog and they appear below. There has been some minor editing and I have supplemented the blog with some charts drawn from the team at Timetric. AS and A2 Specifications, AQA Economics Unit 4, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Macro, Cycles and Shocks, European Economy, The Euro, OECD Economies, Greece Economy, UK Economy, Recession Watch, 2011-04-11T18:51:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/ocr-f585-june-2011-euro-area-on-the-rocks http://www.tutor2u.net/blog/index.php/economics/comments/ocr-f585-june-2011-euro-area-on-the-rocks#When:12:20:00Z Is the Euro Area on the rocks? Yes according to economist Roger Bootle writing in the Telegraph. He argues that there are four facets to the Euro Area crisis - debt, uncompetitiveness, property price deflation and fragility in the European banking system. These are themes well known to students preparing for the OCR F585 paper in a few weeks time. “Given the multi-faceted nature of the euro’s problems, this mixture of depression and deflation is extremely dangerous. Because it reduces aggregate demand, fiscal austerity will intensify the downward pressures on house prices and undermine the quality of banks’ assets!” More here AS and A2 Specifications, OCR A2 Economics Unit F585, European Economy, The Euro, 2011-04-11T12:20:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/a2-macro-paul-masons-blogs-on-the-euro-crisis http://www.tutor2u.net/blog/index.php/economics/comments/a2-macro-paul-masons-blogs-on-the-euro-crisis#When:22:13:00Z For incisive comment on the issues facing the Euro Area, Paul Mason is hard to beat at the moment. Here is a link that tags his recent articles on the Euro Crisis. AS and A2 Specifications, AQA Economics Unit 4, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Macro, European Economy, The Euro, Teaching of Economics, 2011-04-07T22:13:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/ecb-breaks-rank-and-raises-interest-rates http://www.tutor2u.net/blog/index.php/economics/comments/ecb-breaks-rank-and-raises-interest-rates#When:15:20:00Z The European Central Bank has become the first of the four major central banks to lift policy interest rates since the start of the global financial crisis. This decision came on the same day as Portugal applying for emergency support in a bail out that might be worth Euro 80 billion. David Blanchflower, a former member of the Monetary Policy Committee has called the move “a big mistake” hinting that Spain - where more than 80% of mortgages are on variable interest rates - is more vulnerably to financial distress than many are prepared to admit. The ECB is starting to move their policy interest rates towards normal levels - but this tightening of monetary policy starts with the Euro Area suffering 10 per cent unemployment - it takes a hawkish central bank to start increasing the cost of borrowing money when one in ten people in the currency union is out of work and when the Euro has already been appreciating against the US dollar threatening the strength of an export-led recovery for the currency union. The ECB was forced to reverse a rate rise in the autumn of 2008 when the financial crisis took hold. Might they have to do the same sometime this summer? It seems that the ECB has confirmed that the Euro Area will now experience a two-speed currency union for the next few years with Germany leading a group of fast-growing countries and the debt-ridden periphery (the PIIGS) condemned to grow more slowly and suffer the impact of a period of painful fiscal austerity. Eurozone interest rate rise explained (BBC news) Guardian: Portugal bailout analysis: Is Spain next for EU help? - video   AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, EdExcel Economics Unit 2, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Macro, AS Macro, European Economy, The Euro, Macroeconomic Policies, Monetary Policy, OECD Economies, 2011-04-07T15:20:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/euro-crisis-portugal-reaches-for-bail-out http://www.tutor2u.net/blog/index.php/economics/comments/euro-crisis-portugal-reaches-for-bail-out#When:22:00:01Z Portugal has requested an emergency bail out from the European Union to address it’s sovereign debt crisis. It becomes the third Euro Area economy to require help from European partners in the wake of bail outs for Ireland and Greece. The move came after the Portuguese government was forced to pay an interest rate of more than 5% for borrowing money for just one year and in the expectation of the European Central Bank raising policy interest rates in the near future. The Portuguese economy has a major state-sector debt crisis as our Timetric chart below shows. And the economy has been performing poorly for several years with rising unemployment and a steep fall in relative living standards. Already several of Europe’s new economies (including Slovenia and the Czech Republic) have overtaken Portugal in terms of income per capita (PPP adjusted).  Portugal’s long-term credit rating was downgraded by Moody’s by one notch to Baa1 earlier on this week. BBC: EU austerity drive country by country Independent: Portugal seeks €80bn bailout as third nation falls to eurozone crisis Guardian: Portugal’s bailout was all but inevitable Bloomberg: Goldman Sachs Says Portugal Is Last Euro Nation to Seek Bailout Independent, Sean O’Grady: If Spain fails, it will be too expensive to save   AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, EdExcel Economics Unit 2, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Macro, AS Macro, European Economy, The Euro, Financial Markets, OECD Economies, UK Economy, 2011-04-06T22:00:01+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/focus-on-poland http://www.tutor2u.net/blog/index.php/economics/comments/focus-on-poland#When:16:43:00Z Poland is the largest of the central and eastern european countries (CEECs) to have entered the European Union Single Market in the recent enlargement process. And her macroeconomic record during and after the global financial crisis stands comparison as one of the best of the twenty seven EU member nations. Recession has been avoided and the economy is set to continue a long run of economic growth that is (slowly) bringing about a rise in relative living standards and a sustained fall in unemployment. The Guardian newspaper has been running a series on New Europe and this set of articles focuses on some of the challenges and opportunities facing Poland as Europe seeks to drag itself into a durable recovery phase. Guardian - New Europe - Focus on Poland Larry Elliott: Poland’s past and future mix in Gdansk, the start of the road to the 21st century OECD Report on the Polish economy   AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, EdExcel Economics Unit 2, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Macro, AS Macro, European Economy, EU Enlargement, Global Economy, OECD Economies, Poland, 2011-04-05T16:43:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/tracking-the-effects-of-the-recession-on-gdp http://www.tutor2u.net/blog/index.php/economics/comments/tracking-the-effects-of-the-recession-on-gdp#When:11:59:01Z An excellent resource for Unit 2 and Unit 4 macroeconomics. Vishnu Padmanabhan from Timetric has this excellent look at the impact of the recession on real GDP growth in OECD countries. Which countries did best and worst in the recession? It turns out that Australia, Poland, Israel and South Korea were the countries least affected by the crisis and all avoided a full-blown recession - experiencing instead a soft landing. Here is Vishnu’s article. Our own growing selection of Timetric charts can be found by scrolling down to the bottom of this blog entry. The OECD has just produced their annual review of Going for Growth - a largely supply-side look at policies designed to promote long-term growth in productive potential in the world economy. Details can be found here. AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, EdExcel Economics Unit 2, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Macro, AS Macro, Cycles and Shocks, Economic Growth, European Economy, The Euro, Global Economy, Credit Crunch, OECD Economies, French Economy, German Economy, Greece Economy, Ireland Economy, Japan Economy, Spain Economy, US Economy, Teaching of Economics, UK Economy, 2011-04-05T11:59:01+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/as-macro-key-term-relative-deflation http://www.tutor2u.net/blog/index.php/economics/comments/as-macro-key-term-relative-deflation#When:08:20:00Z The term “relative deflation” is generally used to describe an economy with an inflation rate, which has not necessarily descended into negative territory, but is markedly lower than comparable economies. Over time, a low relative rate of inflation can lead to an improvement in price competitiveness in international markets, assuming that there has not been a compensating change in the exchange rate between two countries. In our data example shown below we track consumer price inflation in Ireland, Spain and Germany. For most of the period shown, the annual rate of inflation in Germany was substantially lower than two of her partners in the European single currency area - this is an example of relative deflation. AS and A2 Specifications, AQA Economics Unit 2, EdExcel Economics Unit 2, AS Macro, European Economy, The Euro, Inflation and Deflation, OECD Economies, German Economy, Ireland Economy, Spain Economy, 2011-04-02T08:20:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/ocr-f585-june-2011-competitiveness http://www.tutor2u.net/blog/index.php/economics/comments/ocr-f585-june-2011-competitiveness#When:11:32:00Z One important aspect of the OCR F585 stimulus materials for June 2011 is the economics of competitiveness within the single currency zone - the Euro Area. A conventional view is that some of Europe’s peripheral countries (notably the PIIGS) have become uncompetitive because they have allowed their producer prices, consumer prices and relative unit labour costs to rise. This - in the absence of a compensating exchange rate depreciation - has made their manufacturing and service industries relatively more expensive leading to a deterioration in trade balances, slower growth and stagnating living standards. European Economy, The Euro, OECD Economies, Spain Economy, Teaching of Economics, OCR F585 Economics, 2011-03-31T11:32:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/ocr-f585-june-2011-data-charts-2 http://www.tutor2u.net/blog/index.php/economics/comments/ocr-f585-june-2011-data-charts-2#When:21:58:00Z Here are the second set of updated data charts that I have built into my toolkit for the OCR F585 June 2011 paper. The focus of much of the stimulus material is on the economic difficulties in the Euro Area and this collection of charts reflects this - it looks at the output gap, unemployment and gross government debt for the Euro Area as a whole. European Economy, The Euro, Teaching of Economics, OCR F585 Economics, 2011-03-30T21:58:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/ocr-f585-june-2011-data-charts http://www.tutor2u.net/blog/index.php/economics/comments/ocr-f585-june-2011-data-charts#When:21:39:01Z Here are the updated data charts that I have built into my toolkit for the OCR F585 June 2011 paper. The focus of much of the stimulus material is on the economic difficulties in the Euro Area and this first collection of charts reflects this. European Economy, The Euro, Teaching of Economics, OCR F585 Economics, 2011-03-30T21:39:01+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/poor-human-capital-in-portugal http://www.tutor2u.net/blog/index.php/economics/comments/poor-human-capital-in-portugal#When:07:49:00Z A hat tip to Philippe Legrain for spotting this piece in the Wall Street Journal highlighting the chasm in educational outcomes in Portugal (Western Europe’s poorest nation) contrasted with other EU countries. Only 28% of Portuguese aged 25-64 have completed secondary school vs 85% in Germany and 91% in the Czech Republic. “Portugal must generate enough long-term economic growth to pay off its large debts. An unskilled work force makes that hard.” More here AS and A2 Specifications, AQA Economics Unit 4, European Economy, Single Market, The Euro, Labour Market, 2011-03-25T07:49:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/progress-towards-low-carbon-economic-growth http://www.tutor2u.net/blog/index.php/economics/comments/progress-towards-low-carbon-economic-growth#When:19:56:00Z I am grateful to Tom Whitmey and Leo Barnes for heading over to the lecture and discussion headed up by Lord Nick Stern at the LSE last night. Their notes from the talk are below. AS and A2 Specifications, AQA Economics Unit 1, AQA Economics Unit 3, A2 Micro, AS Micro, Emerging Economies, Cost Benefit Analysis, Environmental Economics, European Economy, Government Intervention, Market Failure, Externalities, Teaching of Economics, 2011-03-18T19:56:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/timetric-currency-movements-against-the-euro http://www.tutor2u.net/blog/index.php/economics/comments/timetric-currency-movements-against-the-euro#When:10:26:01Z A set of Timetric charts following currency movements for non-Euro countries against the Euro European Economy, The Euro, Exchange Rates, 2011-03-16T10:26:01+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/focus-on-spain http://www.tutor2u.net/blog/index.php/economics/comments/focus-on-spain#When:10:18:00Z I will be developing a series of data charts and links to other resources in this blog for students and teachers who want to use developments in the Spanish economy as part of their macro studies. The economy is a member of the single European currency but widely regarded as experiencing deep structural problems and facing a tough adjustment process in the years ahead. At the bottom of the blog we link to recent articles on the Spanish economy. The OCR F585 June 2011 paper focuses on Spain as one of the countries experiencing difficulties within the Euro Area. May 2011 Migrants pushed towards exit by Spanish jobs crisis (BBC) April 2011 Spain economy gets IMF vote of confidence Spanish jobless level hits another record high March 2011 Spain pledges additional measures to strengthen economy   European Economy, OECD Economies, Spain Economy, Teaching of Economics, OCR F585 Economics, 2011-03-16T10:18:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/timetric-comparative-prices-in-the-eu-single-market http://www.tutor2u.net/blog/index.php/economics/comments/timetric-comparative-prices-in-the-eu-single-market#When:23:44:00Z All twenty-seven nations of the EU are members of the single market. Seventeen countries have entered the Euro Area and share a common currency.  Under EU law, as an EU national, you cannot be charged a higher price than local residents when buying products or services anywhere else in the EU, unless the price difference is justified. Price convergence shows the degree to which prices for goods and services in European Union Member States have moved together, or converged, and is an important indicator of the success of the internal market. In contrast, price divergence shows the degree to which prices have moved apart. It is calculated by examining the coefficient of variation of the comparative price levels. The lower the coefficient, the greater is price convergence within the EU Our Timetric chart tracks what has happened to comparative prices within the EU over the years. We see a gradual process of price convergence but there remain widespread and persistent price differences across Europe for similar / standardised products - from petrol to hotel rooms, from clothing to a meal out. I ask students if they can explain some of these price differences and if they can use cost and revenue curve analysis to illustrate them? European Economy, Single Market, Teaching of Economics, UK Economy, 2011-03-15T23:44:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/european-economics-video-resources-for-teaching http://www.tutor2u.net/blog/index.php/economics/comments/european-economics-video-resources-for-teaching#When:22:41:00Z I will keep this blog updated with a selection of video clips relevant to the study of the EU - please check below for some links and embedded videos AS and A2 Specifications, AQA Economics Unit 4, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Macro, AS Macro, European Economy, EU Enlargement, EU Farming and Fishing, Single Market, The Euro, Global Economy, Teaching of Economics, Digital Learning, 2011-03-15T22:41:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/guardian-new-europe-interactive-data http://www.tutor2u.net/blog/index.php/economics/comments/guardian-new-europe-interactive-data#When:23:56:00Z The Guardian has a new series of reports, picture galleries and other resources on New Europe - much here of interest and value for students and teachers who want to broaden their understanding of what is happening within the European Union. Here is the link And you can follow their updates on Twitter. European Economy, EU Enlargement, Teaching of Economics, 2011-03-14T23:56:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/timetric-price-convergence-within-the-eu http://www.tutor2u.net/blog/index.php/economics/comments/timetric-price-convergence-within-the-eu#When:09:10:00Z Has the growth and development of the European Union single market and the Euro accelerated a process of price convergence within the EU? Price convergence means that the gap in prices for the same good or service has come down and in theory, having one currency and an open market ought to bring down the extent of price variations. Our Timetric chart below tracks what has been happening to the price convergence indicator. A fall in the measure indicates a coming-together of average prices. AS and A2 Specifications, AQA Economics Unit 3, A2 Micro, Business Economics, Monopoly, Price Discrimination, European Economy, Single Market, Market Equilibrium and Price, Price Mechanism in Action, Standard of Living, UK Economy, 2011-03-13T09:10:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/timetric-unemployment-rates-for-selected-countries http://www.tutor2u.net/blog/index.php/economics/comments/timetric-unemployment-rates-for-selected-countries#When:20:41:00Z In this Timetric chart blog we look at unemployment rates for a selection of country groups - these automatically updated charts will track what is happening to the standardised jobless rates for clusters of countries starting with one that includes the Euro Area, Germany, USA, UK and Japan. The second chart is the unemployment rates in the so-called PIIGS - Portugal, Italy, Ireland, Greece and Spain AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, EdExcel Economics Unit 2, EdExcel Economics Unit 4, A2 Macro, AS Macro, European Economy, The Euro, OECD Economies, German Economy, Greece Economy, Ireland Economy, Japan Economy, Spain Economy, US Economy, Teaching of Economics, UK Economy, Unemployment, 2011-03-12T20:41:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/ireland-mass-unemployment-and-shrinking-gdp http://www.tutor2u.net/blog/index.php/economics/comments/ireland-mass-unemployment-and-shrinking-gdp#When:18:40:00Z We know that Ireland is in deep economic and financial trouble. Our Timetric chart will keep pace with what is happening to Irish real national output and their unemployment rate (measured as a % of their labour force). And in the links below you can connect to recent blog posts on Ireland - one of the countries inside the Euro Zone that faces a huge sovereign debt crisis that may take years to resolve. Here is the chart AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, EdExcel Economics Unit 2, EdExcel Economics Unit 4, A2 Macro, AS Macro, European Economy, The Euro, Macroeconomic Policies, OECD Economies, Ireland Economy, 2011-03-10T18:40:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/life-at-the-jagged-edge-of-the-euro-zone http://www.tutor2u.net/blog/index.php/economics/comments/life-at-the-jagged-edge-of-the-euro-zone#When:20:50:00Z Paul Mason continues his journey through some of the countries inside the EU facing an economic crisis. Portugal is in recession, construction has slumped and the government is introducing fiscal austerity measures but they are keenly aware that the sovereign debt crisis is yet to hit the economy with full force. A vivid and colourful report from one of the BBC’s top reporters. European Economy, Single Market, The Euro, 2011-02-20T20:50:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/fraud-hits-eu-carbon-emissions-trading http://www.tutor2u.net/blog/index.php/economics/comments/fraud-hits-eu-carbon-emissions-trading#When:20:40:00Z The European Union faces legal action over fraudulent carbon emissions trading according to this article from the Guardian. Students on the short history of carbon emissions trading in the EU will know that the early years of emissions trading have been riddled with problems - not least the over-allocation of permits, a failure to establish proper auction systems, volatile and often low prices - but most serious of all the fraud that appears to be a widespread feature. This undermines the legitimacy of the system. Environmental Economics, European Economy, Government Intervention, Market Failure, Externalities, 2011-02-20T20:40:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/intense-focus-on-cutting-emissions-is-dumb-argues-lomborg http://www.tutor2u.net/blog/index.php/economics/comments/intense-focus-on-cutting-emissions-is-dumb-argues-lomborg#When:23:30:00Z —————————————————————————————— Follow Geoff Riley and tutor2u on Twitter—————————————————————————————— The quality and range of the free lectures at the LSE is hard to beat and half term has given me the chance to pop into several this week. I attended a public seminar on climate change at the London School of Economics last night where the principal speaker was the Skepical Environmentalist Bjorn Lomborg - adjunct professor at the Copenhagen Business School. Once this guy gets going he is difficult to hold back! A relentless delivery was tough to stay with after a busy day in London. I have heard Bjorn Lomborg before and didn’t learn too much that was fresh but it was useful once more to draw a contrarian view on the intense policy focus on cutting C02 emissions as the centre-piece of environmental policy. His new film “Cool It” is released in the UK next month (March 2011) and will no doubt stoke fresh media interest.   AS and A2 Specifications, AQA Economics Unit 1, AQA Economics Unit 3, EdExcel Economics Unit 1, EdExcel Economics Unit 3, A2 Micro, AS Micro, Emerging Economies, Cost Benefit Analysis, Environmental Economics, European Economy, Government Intervention, Market Failure, Externalities, Market Equilibrium and Price, Price Mechanism in Action, Teaching of Economics, 2011-02-16T23:30:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/unemployment-in-germany-and-spain http://www.tutor2u.net/blog/index.php/economics/comments/unemployment-in-germany-and-spain#When:22:54:00Z For many years Germany was criticised for persistently high unemployment rates and an inflexible labour market. But having weathered the worst of the steep contraction in global manufacturing output and trade in 2009 the German economy is being propelled forward by a strong surge in export sales. Unemployment is falling and for the first time in recent memory, the official jobless rate in East Germany is now lower than the state of California! AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, EdExcel Economics Unit 2, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Macro, AS Macro, European Economy, OECD Economies, German Economy, Spain Economy, Unemployment, 2011-02-14T22:54:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/economics-qa-should-the-cap-be-scrapped http://www.tutor2u.net/blog/index.php/economics/comments/economics-qa-should-the-cap-be-scrapped#When:09:12:00Z The Common Agricultural Policy is a system of farm support that was set up by the EU to assist the agricultural sectors of its member states. The CAP accounts for nearly half of the EU’s budget, at approximately £48bn, and combines direct subsidy payments and price support schemes. Economic welfare is concerned with levels of human well-being, and can be achieved through an efficient allocation of resources, thereby maximising consumer and producer surplus. AS and A2 Specifications, AQA Economics Unit 1, AQA Economics Unit 4, EdExcel Economics Unit 4, Economics Q&A, Q&A - Market Failure, Q&A - Markets, A2 Macro, AS Micro, Agriculture, European Economy, EU Farming and Fishing, Government Intervention, Government Failure, Market Equilibrium and Price, Price Mechanism in Action, 2011-02-14T09:12:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/mo-tanweer-on-global-currency-wars http://www.tutor2u.net/blog/index.php/economics/comments/mo-tanweer-on-global-currency-wars#When:01:35:00Z I would have to travel a long way to hear a better and more incisive talk than Mo’s talk at Fulham on Monday about the economics of currency wars. His students are lucky indeed to have such a gifted and authoritative communicator in their classroom! It was fascinating and focused on so many global economic forces that A2 macroeconomists need to have a handle on as their exams loom. Here are some brief notes taken during Mo’s talk and (at the end) a link to a pdf download of Mo’s presentation - full of fantastic supporting charts! AS and A2 Specifications, AQA Economics Unit 4, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Macro, Emerging Economies, European Economy, Exchange Rates, Global Economy, Macroeconomic Policies, Teaching of Economics, UK Economy, 2011-02-11T01:35:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/david-smith-on-shifting-sands-in-the-global-economy http://www.tutor2u.net/blog/index.php/economics/comments/david-smith-on-shifting-sands-in-the-global-economy#When:23:50:00Z David Smith from the Sunday Times was on fine form in his talk to the Global Economy Student Enrichment event at Fulham yesterday. I have some brief notes below on some of his key themes and the pdf version of his presentation can be downloaded from the link at the bottom of the blog AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, EdExcel Economics Unit 2, EdExcel Economics Unit 4, OCR A2 Economics Unit F585, A2 Macro, AS Macro, Emerging Economies, Cycles and Shocks, European Economy, Global Economy, Credit Crunch, Macroeconomic Policies, OECD Economies, Teaching of Economics, UK Economy, Recession Watch, 2011-02-08T23:50:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/high-taxes-stimulate-rise-in-smuggling-of-cigarettes http://www.tutor2u.net/blog/index.php/economics/comments/high-taxes-stimulate-rise-in-smuggling-of-cigarettes#When:21:08:00Z One of the unintended consequences of the steep rise in the real price of cigarettes in the UK is the strong incentive to bring contraband cigarettes into the UK from elsewhere in the EU single market. This Guardian article reports on the expected rise in smuggling as cigarette duties reach fresh highs in 2011. The average price of a pack of 20 cigarettes reached £6.29 in the UK last summer, compared with £2.80 in Spain and £1.57 in Poland. AS and A2 Specifications, AQA Economics Unit 1, EdExcel Economics Unit 1, AS Micro, European Economy, Single Market, Government Intervention, Indirect Taxes, Market Failure, Externalities, Merit & De-Merit Goods, Market Equilibrium and Price, Nature of Demand, 2011-02-06T21:08:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/5-fresh-links-videos-to-attract-fdi http://www.tutor2u.net/blog/index.php/economics/comments/5-fresh-links-videos-to-attract-fdi#When:19:04:00Z I am teaching European and Global context for A2 macro this term and one of the key topics is the economics of EU enlargement. The opportunities to attract inflows of direct investment is one of the major attractions for new EU countries as they enter the single market. Here is a selection of videos promoting FDI into a selection of European nations. AS and A2 Specifications, AQA Economics Unit 4, A2 Macro, AS Macro, Cycles and Shocks, Aggregate Demand, Capital Investment, European Economy, EU Enlargement, Single Market, Macroeconomic Policies, Supply-side policies, Trade Policies, Teaching of Economics, 2011-02-04T19:04:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/carbon-taxes-the-best-hope-for-a-low-carbon-future-in-europe http://www.tutor2u.net/blog/index.php/economics/comments/carbon-taxes-the-best-hope-for-a-low-carbon-future-in-europe#When:10:03:00Z With EU carbon emissions market has closed since the middle of January after hackers stole €30m of permits the economics of a EU wide carbon tax has been given fresh prominence in recent weeks. Charles Hart evaluates the arguments for and against a tax on emissions in this super applied micro essay. After the essay there are some links to recent blog posts and other resources on carbon trading and carbon taxation. AS and A2 Specifications, AQA Economics Unit 3, EdExcel Economics Unit 3, Economics Q&A, Q&A - Market Failure, A2 Micro, AS Micro, Business Economics, Environmental Economics, European Economy, Single Market, Global Economy, Government Intervention, Indirect Taxes, Market Failure, Externalities, Information Failure, Market Equilibrium and Price, Price Mechanism in Action, Teaching of Economics, UK Economy, 2011-02-03T10:03:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/wto-finds-boeing-guilty-of-using-illegal-subsidies http://www.tutor2u.net/blog/index.php/economics/comments/wto-finds-boeing-guilty-of-using-illegal-subsidies#When:08:23:00Z This is one of the longest running disputes in trade history. Europe and the US have been fighting for more than six years over each other’s subsidies for large passenger aircraft in the duopolistic battle between Boeing and Airbus. Now the World Trade Organisation has found that Boeing received at least $5bn (£3.1bn) in illegal subsidies and was only able to launch its 787 Dreamliner with such support. Airbus has als been found to be in breach of receiving illegal state aid. Reuters provides useful background here. AS and A2 Specifications, AQA Economics Unit 4, EdExcel Economics Unit 4, A2 Macro, Business Economics, Oligopoly, European Economy, Single Market, Global Economy, Government Intervention, Subsidies, OECD Economies, Market Equilibrium and Price, Nature of Demand, Nature of Supply, Teaching of Economics, Transport Economics, 2011-02-01T08:23:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/the-ethics-of-paying-to-pollute http://www.tutor2u.net/blog/index.php/economics/comments/the-ethics-of-paying-to-pollute#When:08:45:00Z Here is a thought-provoking piece from the BBC web site on ethical dimensions to policies such as carbon trading and carbon taxation. Aristotle on modern ethical dilemmas AS and A2 Specifications, AQA Economics Unit 3, A2 Micro, Business Economics, Environmental Economics, European Economy, Market Failure, Externalities, Teaching of Economics, 2011-01-31T08:45:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/5-fresh-links-reforming-the-eu-common-agricultural-policy http://www.tutor2u.net/blog/index.php/economics/comments/5-fresh-links-reforming-the-eu-common-agricultural-policy#When:12:09:01Z The economic, environmental and social issues arising from farm support in developed and developing countries often figure in final year teaching for A2 economics. We are looking at this at the moment as part of our teaching of the economics of the EU. Here are five fresh links on the vexed question of how best to reform the Common Agricultural Policy of the EU - including two recent videos from BBC news. AS and A2 Specifications, AQA Economics Unit 1, AQA Economics Unit 3, A2 Micro, AS Micro, Agriculture, Emerging Economies, Development Economics, Commodities Markets, European Economy, EU Farming and Fishing, Government Intervention, Buffer Stocks, Government Failure, Market Equilibrium and Price, Price Mechanism in Action, Teaching of Economics, UK Economy, Regional Economics, 2011-01-25T12:09:01+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/global-economy-2011-student-conference-london-feb http://www.tutor2u.net/blog/index.php/economics/comments/global-economy-2011-student-conference-london-feb#When:15:45:01Z I’m pleased to provide more details about our Economics student enrichment conference at Vue Cinema (Fulham Broadway) on Monday 7th February 2011. Global Economy 2011 is designed to allow students (and their teachers!) to deepen their understanding of developments in the international economy as we enter 2011. Confirmed speakers already include: * Geoff Riley (Tutor2u):  An Ever Bigger Union? Has EU Enlargement been a success? * Ruth Tarrant (Tutor2u): Trade Imbalances and Development - A Global Perspective * James Bevan (Chief Economist of CCLA Investment Management, Radio 5 Wake up to Money): The Economics of Global Cities - Challenges facing London * David Smith (Economics Editor of the Sunday Times), The Global Financial Crisis and the Changing World Economy * Mo Tanweer (Head of Economics, Oundle School): The Economics of Currency Wars Monday 7 February 2011 Venue: Vue Cinema, Fulham Broadway Timing: 10:45 am to 3.15 pm There are still some places available for the conference.  Please request places using the following form or by in the office: Booking Form for Global Economy 2011 AS and A2 Specifications, AQA Economics Unit 4, EdExcel Economics Unit 4, OCR AS Economics Unit F582, A2 Macro, Emerging Economies, European Economy, Global Economy, International Trade, OECD Economies, Teaching of Economics, 2011-01-23T15:45:01+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/economics-qa-can-economics-provide-answers-to-the-crisis-of-collapsing-stoc http://www.tutor2u.net/blog/index.php/economics/comments/economics-qa-can-economics-provide-answers-to-the-crisis-of-collapsing-stoc#When:19:01:00Z The UK is one of many countries that now face a dilemma when it comes to fish stocks and their sustainability. In the UK we now consume over 385,000 tons of fish per year whilst on a global scale only 10% of large fish stocks that existed in the 1950s are still present today; this include both cod and tuna. Stock depletion has become a larger issue because of the increases in fishing technology – especially in long-line fishing which is the main technique used in Japan. As a result many of the once inaccessible fish reserves have become economically viable to fish as boats are more fuel efficient and require less labour. In a fully functioning market the decline in supply of the product would cause an increase in price and act as a disincentive for consumers to purchase the product meaning that the industry would reach a sustainable equilibrium. In this case however there has been a deep market failure resulting from the tragedy of the commons. The sea, and its fish, is a common resource either on a global scale or on a national scale within a country’s own territorial waters. There are very few established property rights over the sea meaning that rational economic agents have an incentive to plunder the seas resources causing the falling fish stock levels. AS and A2 Specifications, AQA Economics Unit 3, Economics Q&A, Q&A - Market Failure, Q&A - Markets, A2 Micro, Cost Benefit Analysis, Environmental Economics, European Economy, EU Farming and Fishing, Global Economy, Market Equilibrium and Price, Price Mechanism in Action, Teaching of Economics, 2011-01-19T19:01:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/roger-harrabin-environmental-economics-videos http://www.tutor2u.net/blog/index.php/economics/comments/roger-harrabin-environmental-economics-videos#When:00:25:00Z I am a big fan of the journalistic work of Roger Harrabin at the BBC. Here is a nap hand selection of five recent video pieces on environmental issues focusing on emissions issues and policies in developed and developing countries. AS and A2 Specifications, AQA Economics Unit 1, AQA Economics Unit 3, A2 Micro, AS Micro, Emerging Economies, Development Economics, China Economy, Cost Benefit Analysis, Economic Growth, Economics of Technology, Environmental Economics, European Economy, Global Economy, Government Intervention, Government Failure, Market Failure, Externalities, Teaching of Economics, 2011-01-18T00:25:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/environmental-economics-five-fresh-links http://www.tutor2u.net/blog/index.php/economics/comments/environmental-economics-five-fresh-links#When:23:00:00Z Here are five links to stories and issues connected to environmental economics - we are embarking on a study of this for our A2 microeconomics AS and A2 Specifications, AQA Economics Unit 3, A2 Micro, AS Micro, Emerging Economies, Development Economics, Cost Benefit Analysis, Environmental Economics, European Economy, Global Economy, Government Intervention, Market Failure, Externalities, Poverty and Inequality, Teaching of Economics, 2011-01-13T23:00:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/is-2011-the-year-the-euro-will-fall http://www.tutor2u.net/blog/index.php/economics/comments/is-2011-the-year-the-euro-will-fall#When:11:12:00Z BBC Newsnight discusses in this video report whether the Euro Area can continue in its current state during 2011. This may well be a make or break year for the single currency and Paul Mason focuses on the problems facing the slow growing, mass unemployed Spanish economy.  I liked this phrase “Europe faces a debt problem at it’s periphery and a credibility problem at it’s core”. Sounds like a cracking essay title! Timetable of the euro-showdown There is a really good piece here in the Globe and Mail on the difficulties facing the Euro Area - it is a long way from coming close to being an optimal currency zone. AS and A2 Specifications, AQA Economics Unit 4, A2 Macro, European Economy, The Euro, Macroeconomic Policies, 2011-01-09T11:12:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/firefox-overtakes-ie-in-the-eu-browser-market http://www.tutor2u.net/blog/index.php/economics/comments/firefox-overtakes-ie-in-the-eu-browser-market#When:09:23:00Z The Telegraph reports here that Mozilla’s Firefox has overtaken Internet Explorer as the preferred browser for internet users in Europe. And Google’s Chrome is fast gaining a strong foothold in this intensely competitive market. The market share data suggests an oligopoly but we know that despite the dominance of a small number of web browsers, the reality is that competition is fierce and millions of web users have their own quite strong preferences! Source: StatCounter Global Stats - Browser Market Share Lots to think about here in terms of economic efficiency - not least dynamic efficiency and innovation in the market. And also the impact of competition policy in action .... as the article says at the end “Since early 2010, Microsoft has offered millions of European customers that use its Windows software the option of using 12 different internet browsers. This followed an agreement in December 2009, when European Union regulators accepted Microsoft’s pledge to give consumers better access to rival browsers, ending a long antit-trust dispute.” A hat tip to Ian Goff for spotting the article. If you want to keep an eye on what is happening to market share on a daily basis this is the link to the StatCounter site   AS and A2 Specifications, AQA Economics Unit 1, AQA Economics Unit 3, EdExcel Economics Unit 3, A2 Micro, AS Micro, Business Economics, Oligopoly, Economic Growth, Economics of Technology, European Economy, Single Market, Market Equilibrium and Price, Nature of Demand, Teaching of Economics, 2011-01-05T09:23:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/economics-qa-benefits-costs-food-prices http://www.tutor2u.net/blog/index.php/economics/comments/economics-qa-benefits-costs-food-prices#When:18:08:00Z A sustained rise in the global prices of foodstuffs is called agflation. As our chart below shows, the Economist’s index of global food prices has shown high volatility in recent years, there have been two sizeable and steep increases in food prices and a downturn in the wake of the 2009 global recession. And now the United Nations Index of Food Prices has now risen back above levels last seen in 2008 at a record high. A period of rising food prices affects both the demand and supply-side of an economy. And the impact will depend on many factors including: (i) The patterns of trade for one or more countries e.g. whether a country is a net exporter or importer of food (ii) The importance of food production and exports in economic activity e.g. the share of value added contributed by farming, food processing and other food-related industries (iii) Average incomes for a given country / region and the percentage of incomes that must be spent on food to ensure a modest but adequate lifestyle (iv) Possible effects of rising food prices on variables such as inflation, interest rates and the exchange rate AS and A2 Specifications, AQA Economics Unit 1, AQA Economics Unit 4, A2 Macro, AS Micro, Agriculture, Emerging Economies, Cycles and Shocks, European Economy, EU Farming and Fishing, Global Economy, Market Equilibrium and Price, Price Mechanism in Action, Price Volatility, Standard of Living, Teaching of Economics, 2011-01-04T18:08:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/economics-qa-why-might-europes-weaker-economies-struggle-to-grow-in-the-nex http://www.tutor2u.net/blog/index.php/economics/comments/economics-qa-why-might-europes-weaker-economies-struggle-to-grow-in-the-nex#When:21:46:00Z A starting point to this question is to discuss what “weaker EU countries” might mean. We can use some of the conventional indicators of macro performance to help us namely: 1. Slow or negative economic growth 2. Rising unemployment and falling employment rates 3. Deteriorating public sector finances and higher government debt 4. Relatively high inflation or perhaps an economy experiencing a period of deflation 5. A high deficit in trade in goods and services Other indicators might be used to identify weaknesses in performance - for example: 1. Relatively low labour productivity 2. A falling share of global trade 3. Rising yields on long term government bond issues 4. Weaknesses in non-price competitiveness AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, EdExcel Economics Unit 2, EdExcel Economics Unit 4, A2 Macro, AS Macro, Cycles and Shocks, European Economy, The Euro, Global Economy, OECD Economies, Greece Economy, Ireland Economy, Spain Economy, Teaching of Economics, Recession Watch, 2011-01-02T21:46:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/legal-cooperation-between-businesses http://www.tutor2u.net/blog/index.php/economics/comments/legal-cooperation-between-businesses#When:19:10:00Z Not all instances of collusive behaviour are deemed to be illegal by the European Union Competition Authorities. Practices are not prohibited if the respective agreements “contribute to improving the production or distribution of goods or to promoting technical progress in a market.” • Development of improved industry standards of production and safety which benefit the consumer • Information sharing designed to give better information to consumers • Research joint-ventures and know-how agreements which seek to promote innovative and inventive behaviour in a market. The EU has introduced a “R&D Block Exemption Regulation” for this In December 2010 the EU Competition Commission introduced new guidelines on the types of ‘horizontal cooperation’ that is allowed under EU laws. And here is a good recent example - the development of and agreement on joint industry standards in Europe for mobile phone chargers which means that mobile and smartphone users will soon be able to use a standardised charger. The common charger will make life easier for consumers, reduce waste (good for the environment) and benefit businesses who dont have to spend as much on developing their own charger technologies. Apple, Emblaze Mobile, Huawei Technologies, LGE, Motorola, NEC, Nokia, Qualcomm, RIM, Samsung, Sony Ericsson, TCT Mobile (Alcatel), and Texas Instruments have all signed up to the agreement.   AS and A2 Specifications, AQA Economics Unit 1, AQA Economics Unit 3, A2 Micro, AS Micro, Business Economics, Oligopoly, Economic Growth, Economics of Technology, European Economy, Single Market, Market Equilibrium and Price, Nature of Supply, Teaching of Economics, 2010-12-30T19:10:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/links-to-articles-on-the-eu-economy http://www.tutor2u.net/blog/index.php/economics/comments/links-to-articles-on-the-eu-economy#When:13:55:00Z I have put together a listing of suggested reading / articles on different aspects of the economics of the EU. This is available for download below as a pdf file. AS and A2 Specifications, AQA Economics Unit 4, A2 Macro, European Economy, EU Enlargement, EU Farming and Fishing, Single Market, The Euro, Teaching of Economics, 2010-12-29T13:55:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/european-union-economy-in-charts http://www.tutor2u.net/blog/index.php/economics/comments/european-union-economy-in-charts#When:10:37:00Z Here is an updated twenty five slide streamed presentation on macroeconomic developments in the 27 countries of the EU with a particular focus on the Euro Area and UK/EU comparisons. AS and A2 Specifications, AQA Economics Unit 4, A2 Macro, European Economy, EU Enlargement, The Euro, Macroeconomic Policies, OECD Economies, French Economy, German Economy, Greece Economy, Ireland Economy, Spain Economy, UK Economy, 2010-12-29T10:37:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/estonia-joins-the-euro http://www.tutor2u.net/blog/index.php/economics/comments/estonia-joins-the-euro#When:09:39:00Z The New Year sees the seventeenth country join the Euro with the arrival of Estonia into the single currency bloc. Read Estonians prepare to join the euro and ditch the kroon The Baltic State with just 1.3 million inhabitants experienced and then suffered an unsustainable inflationary boom in the years immediately after entering the EU in 2004 and that boom came to a spectacular end in 2008. AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, A2 Macro, AS Macro, Emerging Economies, European Economy, EU Enlargement, The Euro, Exchange Rates, Macroeconomic Policies, Teaching of Economics, 2010-12-27T09:39:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/euro-in-focus-fiscal-austerity-measures http://www.tutor2u.net/blog/index.php/economics/comments/euro-in-focus-fiscal-austerity-measures#When:09:50:00Z 2009 and 2010 have been hugely difficult and painful years for many of the countries inside the currency union. A dangerous combination of deep recession, rising unemployment, a severe worsening of government finances, high public sector debts and the expectation that a period of fiscal austerity will hit living standards badly have all contributed to a sense of malaise for those countries that have entered monetary union. AS and A2 Specifications, AQA Economics Unit 4, A2 Macro, European Economy, The Euro, Macroeconomic Policies, Fiscal Policy, UK Economy, Recession Watch, 2010-12-24T09:50:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/eu-economy-focus-on-inflation http://www.tutor2u.net/blog/index.php/economics/comments/eu-economy-focus-on-inflation#When:13:45:00Z The economic and financial affairs unit of the EU has produced this resource on inflation within the European Union. It covers the meaning and measurement of inflation, inflation expectations and some study notes on the consequences of inflation for people living inside the single market. It is available here. AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, A2 Macro, AS Macro, European Economy, Single Market, The Euro, Inflation and Deflation, Teaching of Economics, 2010-12-16T13:45:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/eu-has-to-reduce-its-import-barriers http://www.tutor2u.net/blog/index.php/economics/comments/eu-has-to-reduce-its-import-barriers#When:11:49:01Z The EU imposes tariffs on imports from China, Vietnam and Cuba, because it considers that they are not market economies. The World Trade Organisation allows importers to place extra duties on goods which are being ‘dumped’ on the world market - that is, being sold at a price which is below the price in the country of origin. These two issues came together at the beginning of 2009, when the EU decided to impose anti-dumping duties of up to 87 percent for the next five years on screws, nuts and bolts imported from China - but in mid-2009 China claimed to the WTO that the threshold price had been wrongly calculated, and that the tariff breaks international trade rules. Over a year later, the WTO has finally reached a decision in China’s favour, saying that the tariffs must be removed - marking a victory for China in its first WTO dispute against the European Union. In a trade dispute between the two, China has imposed its own tariffs on imports from the EU. This story, reported by the BBC and China Daily amongst others, gives evidence for the economic theory that import tariffs tend to lead to retaliation and there is a net reduction in trade - and also for the practical economics which shows that, however sensible the theory may sound, in practice countries often make decisions which suit their own domestic purposes. AS and A2 Specifications, AQA Economics Unit 4, A2 Macro, Balance of Payments, Emerging Economies, China Economy, European Economy, Global Economy, International Trade, Macroeconomic Policies, Trade Policies, OECD Economies, Teaching of Economics, UK Economy, 2010-12-04T11:49:01+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/on-the-first-day-of-christmas http://www.tutor2u.net/blog/index.php/economics/comments/on-the-first-day-of-christmas#When:00:21:00Z There are lots of aspects of economics in this little story from the Independent on Wednesday 1st December. The final section of the report into the effects of the early snow falls is about Christmas tree shortages, and links to this BBC story about Nordmann fir trees, and the two together contain several references to the A level syllabus: AS and A2 Specifications, AQA Economics Unit 1, AS Micro, Business Economics, Competitive Markets, European Economy, EU Farming and Fishing, Market Equilibrium and Price, Nature of Demand, Nature of Supply, Price Mechanism in Action, Quirky Trivia, 2010-12-03T00:21:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/using-google-docs-the-irish-financial-crisis http://www.tutor2u.net/blog/index.php/economics/comments/using-google-docs-the-irish-financial-crisis#When:17:58:00Z My Year 13 students have worked on a collaborative piece this week on the Irish financial and economic crisis. We considered the background to the crisis, why the UK is helping with the bail out and some of the consequences for the future stability of the Euro. The final version of the Google Doc is available to download here. A2_Macro_Irish_Crisis.pdf AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, EdExcel Economics Unit 2, EdExcel Economics Unit 4, A2 Macro, AS Macro, Cycles and Shocks, European Economy, The Euro, Macroeconomic Policies, Keynesian Economics, OECD Economies, Ireland Economy, Teaching of Economics, UK Economy, Recession Watch, Credit Crunch, 2010-11-29T17:58:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/iland-shareholders-and-taxpayers-feel-the-pain http://www.tutor2u.net/blog/index.php/economics/comments/iland-shareholders-and-taxpayers-feel-the-pain#When:19:45:00Z On a scale of 1 to Ireland, how broke are you? In February 2007 The Bank of Ireland had a market capitalisation of over sixty billion euro. Market cap is the market value of a company’s issued share capital, i.e. the number of shares multiplied by the current price of those shares on the stock market. Today that market cap has collapsed - and as of this morning - With a market cap of $1.4bln, the bookmaker Paddy Power is now Ireland’s largest financial stock! Another perspective: Facebook’s latest stock market valuation is €105bn. Ireland’s annual GNP: €130bn. And low-cost airline Ryanair’s market cap tonight is nearly three times that of the entire Irish banking system! The destruction of shareholder value in the Irish banking system is immense - but the losses and debts of the banks have been socialised and are being borne by Irish taxpayers. The emergency budget will hit people tremendously hard - among the announcements: * €200 per household property tax for Ireland * VAT will rise twice to 23% * A cut in the national minimum wage in Ireland - cut by one euro to 7.65 euros per hour * Pay cuts in the private sector * The introduction of domestic water charges by 2014. Rumours that Steve Jobs is set to use some of Apple’s cash pile to purchase the country and re-brand it iLand appear to be a little wide of the mark!   AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, A2 Macro, AS Macro, Cycles and Shocks, European Economy, The Euro, Macroeconomic Policies, OECD Economies, Ireland Economy, Teaching of Economics, Credit Crunch, 2010-11-24T19:45:00+00:00 http://www.tutor2u.net/blog/index.php/economics/comments/why-is-the-uk-helping-ireland http://www.tutor2u.net/blog/index.php/economics/comments/why-is-the-uk-helping-ireland#When:20:18:00Z This was a question posed this morning by one of my year 12 students and led to an interesting class discussion as to whether we should indeed be lending the Irish £7 billion. I’ve now found a BBC news video which will illuminate this topic further… AS and A2 Specifications, AQA Economics Unit 2, AQA Economics Unit 4, A2 Macro, AS Macro, European Economy, The Euro, OECD Economies, Ireland Economy, UK Economy, 2010-11-22T20:18:00+00:00