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Teaching Economics

In the News

The Collapse of Carillion

Graham Watson

15th January 2018

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Lots of questions need answering...

Why were Carillion awarded government contracts up until very, very recently? To what extent were the management aware of the financial problems when they were still bidding for contracts?

What are the costs of this to the government? What are the implications for the public finances? What about the macroeconomic effects?

From a microeconomic perspective, is this a classic example of moral hazard? And to what extent is bad management responsible and is this a function of incompetence or misaligned incentives?

Carillion collapses into liquidation

Some reactions to the news about the liquidation of Carillion:

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Graham Watson

Graham Watson has taught Economics for over twenty years. He contributes to Tutor2U, reads voraciously and is interested in all aspects of Teaching and Learning.

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