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AS and A Level: UK, European & Global Economics
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How to evaluate effectively in economics
- 1 A significant proportion of marks are likely to be for evaluation. Trigger words include ‘assess’, ‘to what extent’ and ‘evaluate’. Evaluation can come during a piece as well as at the end. It includes any critical distance you add to your points.
- 2 Stating both sides of an argument or different points of view e.g. advantages and disadvantages will give you a start. Try to group them rather than a list of each. This will score more evaluation marks as you are linking the two arguments.
- 3 Discussing the long term versus the short term effects is a good method of evaluating. Don’t be frightened to acknowledge that it may even be too early to say with certainty what the outcome will be. An example of this is the impact of the UK not being in the Eurozone.
- 4 If you have made several points, you can gain evaluation marks for prioritising them or just saying which you believe is the most significant and why.
- 5 How significant will a particular point be and will it affect different groups of people in different ways. Discuss these for evaluation marks.
Five things to know about exchange rates
- 1 Most exchange rates are ‘floating’. This means that the value of one currency expressed in terms of another currency varies according to the demand and supply for and of each currency.
- 2 Factors affecting the demand for a country’s currency are the demand for the goods and services of it, the demand of its citizens for imported goods, relative interest rates and speculation. If for example, UK interest rates are relatively high, then people will buy pounds to save in UK banks. This will increase the value of the pound.
- 3 Exchange rates affect the competitiveness of a country’s products. Remember the acronym SPICED – Strong Pound Imports Cheaper Exports Dearer.
- 4 A strong pound will be worse for UK producers as they will struggle to compete with cheaper imports and UK exports will look relatively more expensive abroad. It will however be useful to reduce domestic inflation.
- 5 A weak pound will help UK producers for the opposite reason but may lead to inflation. It will help the balance of payments subject to the Marshall Lerner condition (learn this and use it for evaluation).
What is globalisation?
- 1 Globalisation refers to the increasing integration of the world’s economies meaning more international trade, increased international flows of capital, shifting patterns of consumption and production across countries e.g. outsourcing production.
- 2 Many reasons are put forward for its growth and it is hard to differentiate between its causes and effects. Is the growth of multinational companies and their desire for greater profits a cause of globalisation or its effect?
- 3 Other reasons put forward for globalisation are the reduction in trade restrictions, growth of the internet, cheaper international transport costs, opening up of China and the old communist countries. Again they could be cause or effect.
- 4 The effects of globalisation are debatable (more evaluation opportunities). Generally it is seen as increasing the level of wealth as countries specialise more in the products in which they have a comparative advantage.
- 5 Recent economic uncertainty has lead to some talk of de-globalisation where international trade declines due to increased protectionism (tariffs and quotas).
- Marked by Teachers essays 11
- Peer Reviewed essays 3
In other words, a globalized world is one in which social, economic and political events become more and more interconnected and where such events have more impact upon each other. Most people will agree that nowadays the world economy is more interdependent than ever. However, opinions clash when trying to come to a decision about whether or not it is a positive process or not. It is a subject which constantly draws fervent support and fervent opposition. Firstly, it is necessary to draw up some arguments in favour of globalization.
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Any return of profits are small compared to these points. Export led growth brings structural change and diversification for LDCS, monoculture leads to stagnation, unstable earnings and 3rd world debt. True Globalisation should bring the advantages of free trade (make sure you know them) - competition, productive and allocative efficiency, comparative advantage and huge gains from specialization, economies of scale and consumer choice. It also should provide the 3rd world with desperately needed Western capital and technology while the West gains the world's poor migrants to meet their labour shortages.
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International trade is also seen as a vital measure which can encourage growth for a nation's economy. The general belief of international trade is that based upon the idea of specialisation and exchange, which will lead to a general increase in world living standards. The guiding principle is that trade should be based on co-operation and any barriers to trade should be removed. There are numerous international organisations that are present which exist in order to promote free trade. A great advocate of this system of trade was Adam Smith (The Wealth of Nations 1776), he argued that nations should
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Productivity: refers to the quantity of goods and services the economy can produce with a given amount of inputs such as capital and labour. Demand-Pull Inflation: occurs when AD or As is growing while the economy is still nearing its supply capacity, so that higher demand leads to higher process rather than more output. Cost-Pull Inflation: occurs when there is an increase in production costs that producers pass on in the form of higher prices this raising the rate of inflation.
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There are 3 areas to judge for sustainability. 1. Economic sustainability. 2.Social sustainability. 3. Environmental sustainability.
by Population growth, now 6.5 billion people and expected to rise to over 9 billion in 20 years. Farmland, fish and forests and the environment are all under tremendous pressure as economies grow and industrialise, people want cars and houses with central heating etc. There are 3 areas to judge for sustainability. 1. Economic sustainability. 2.Social sustainability. 3. Environmental sustainability. Economic sustainability means we need to increase GDP growth to lift present generations out of poverty and need. This also implies we must provide good human investment in both health and education so future generations are as productive as present.
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A view from the bridge - Examine the manliness hostility and aggression and the ways in which they may be linked
Eddie likes to feel that he is in control of his family, even if he is not. One example of this is when Eddie says to Catherine: "what's the heels for?". This quote shows that he likes to be Catherine's 'so called father', although he is not her father, but also shows the audience that in Eddie's eyes Catherine is still a young girl and should not behave in such manner. Eddie's protectiveness and possession over Catherine seems a bit over but strong.
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Different parts of Britain saw the growth of different types of manufacturing industries. Coalbrookdale is famed for its Iron works; the Pennines for wool and cotton manufacturing, the area around Stoke is still referred to as being the 'Potteries' today. These areas built up due to close proximity to raw materials, the intended market for the produce and to ports. Each areas population grew rapidly as impoverished agricultural workers sought a new life and guaranteed work in the apparently prosperous cities.
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Free trade enables these goods to be obtained. Ricardo's law of Comparative Advantage states that, even if one country has an absolute advantage in producing all goods over another, each country will gain from trade providing each specialises in the production of that good in which it has a comparative advantage, or lower opportunity cost, in producing. If a country produces to its comparative advantage, the LRASC (long run average supply curve) will move to the right. It will also lead to reduced costs of production as nations move towards economies of scale.
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The second condition was money circulating as a ratio to gold reserves, also known as the 'Gold content'. How much this ratio varied depended on the country. Britain, Finland, Japan, Norway and Russia were 100% backed with gold reserves while Belgium, Holland and Switzerland used a cover system that allowed some degree of flexibility in the reserves of gold held. There also seemed to be a lack of exchange control associated within the gold standard with currency conversion being regulation-free. Lastly, both people and money and hence gold were allowed to freely cross borders making monetary exchange and conversion easier for consumers and producers alike.
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NAFTA is not a customs union; it is purely a free trade area, this entails that the aim of the agreement is to eliminate trade barriers between member countries to increase economic activity. The Free Trade Commission (FTC) is the main organ of NAFTA. Composed of the US Trade representative, the Canadian Minister for International Trade and the Mexican Secretary of Commerce and Industrial Development, it monitors the performance and development of NAFTA, and includes a dispute settlement panel. The Secretariat, with national offices in the three capitals serves as an administrative office for the FTC, the dispute panel and the various committees and working groups that runs the organisation day to day.
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HOW DID JAPAN ACHIEVE INTERNATIONAL COMPETITIVENESS IN TEXTILE INDUSTRY? EXPLAIN THE ROLE OF THE GOVERNMENT AND THE CONTRIBUTION OF PRIVATE INDUSTRY
The special significance of Japanese textile products is that they are typically among the most labour intensive, least technology demanding manufactures for developing countries to produce. In an initial developmental phase involving large transfers of labour from the tradition based agriculture sector to modern manufacturing sectors. Increased exports of textiles accommodate increased production, which implies increased human capital accumulation and ultimately higher economic growth. It is widely believed that as textile exports increase, a nation's GDP growth will be higher.
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Many examples of Companies working globally are: Nike, Adidas and other companies which may not necessarily be in the clothing business. These are usually referred to as TNC's or transnational companies
TNC's also plays a large part in globalisation. A TNC is a transnational company. (c) Here are some easily recognisable transnational companies. (Top left: Nike, Top right: Coca Cola, Below: Mc Donalds.) If you still do not understand what a TNC is maybe this will help. A TNC is a company which is known worldwide. A company which manufactures goods in various different countries and sells them in various different countries like the ones you can see above. Companies that are involved in various different countries worldwide are TNC's.
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Given the fact that Third World countries are underdeveloped (or developing); the causes that led to their underdevelopment are controversial. According to dependency theorists; capital accumulation in the Core had led to the underdevelopment
Examples of strong hegemonic powers like the United States, with its leading economic and political power, challenge the progress of other inferior nations. Examples have proved that even countries that managed to progress significantly like Japan, have in one way or another been affected by U.S. aid and relations. As for examples of Third World countries that are still ranked as underdeveloped but have shown economic progress, Cuba lies as a good example of a country that tries to improve but is also affected by foreign wealthy countries' control.
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Consider the Extent to Which Economic Theories Effectively Explain the Changing Patterns of Trade in Recent Years. In recent years, there has many changes in international trade,
A trade pattern is what goods and services a country trades, with whom, and in what direction. The trade pattern is one of the major purposes of trade theory, especially what goods a country will export, and what it will import. For example (Saudi Arabia Export Oil to the UK and they have imported fighter aircraft from the UK) BAE SYSTEMS' triumph last month with a new multibillion-pound contract to supply fighter aircraft to Saudi Arabia signalled a fresh boost to Britain's relationship with the Kingdom. http://business.timesonline.co.uk/article/0,,9063-1984742,00.html Date Viewed 17/01/2006 This may be done directly, as the commodity pattern of trade (The trade pattern of a country or the world, focusing on goods and services traded.
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The free market provides an alternative to large concentrations of political power that otherwise would be detrimental. 2. Since the inception of classical economics over 200 years ago, one of the most profound assumptions made by the father of economics, Adam Smith, has been 'that an invisible hand determines market prices and that market prices follow a random walk.' (Friedman p8) The 'invisible hand' has been used in many forms and differing contexts but most predominantly refers to the theorem that 'by pursuing his own interests he frequently promotes that of the society more effectually than when he really intends to promote it.'
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The term was coined to differentiate the cultural divide between East and West. As nations become economically developed, they may become part of the "North", regardless of geographical location, while any other nations which do not qualify for "developed" status are in effect deemed to be part of the "South".1 For more than a generation, the North-South divide was central to the explanation of world inequality and poverty. From the 1960's until the late 1980's, the image of a world split between the wealthy developed countries of the North and the poor developing countries of the South fuelled the activity
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The analysis of this model can explain what happens when each country moves from autarky (no trade) to free trade with the other country. In other words what are the effects of trade. The main things should care about are trade's effects on the prices of the goods in each country, the production levels of the goods, employment levels in each industry, the pattern of trade (who exports and who imports what), consumption levels in each country, wages and incomes, and the welfare effects both nationally and individually. Theory of comparative Advantages: The modern version of the Ricardian Model assumes Firstly that there is two countries, producing two goods, using one factor of production, usually labor such as (2 x 2 x 1)
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I will also outline the role in which states play in the system of international relations and politics, and also how and what restrains them in these roles. According to varying international relations theories, the state plays various different roles. Realists have traditionally believed that the state, which is always identified as the key actor in international politics, must always pursue power, and it is the main duty of the chief statesperson to rationally take the most appropriate steps to perpetuate the life of the state for as long as possible.
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Critically assess the argument that countries will be better-off if they engage in international specialization and trade.
disposition to produce a particular product cheaply (or more expensive) than another one. And this is the point where two theories concerned with it crop out. The first of them is The Theory of Absolute Advantage which was first developed by Adam Smith4 in 1776 when he suggested that a country has an absolute advantage in the production of a product when it is more efficient than any other country in producing it5 so the country should never produce goods at home that it can buy at a lower cost from other countries.
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What were the major changes in the international economy after 1914? Why did the gold standard work well before 1914 but not in the interwar period?
Also to finance the war, there was a major shift of resources from consumer to military goods for all the countries that were involved in the war. As a result there was a shortage of essential consumer commodities. Large sums of money was also financed by public debt so as to cover the cost of the war. International trade along with political and economic relations between major economies of the world came to a standstill. The currencies of major economic powers were no longer considered a reliable media of exchange.
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Islamic terrorism is a serious problem for the United States because of the threat to national security, innocent civilians, and the foundations of democratic societies throughout the world.International terrorism has changed in structure
Radical Islamic organizations have declared a holy war, Jihad, in order to bring the Arab world together and take their place as a world power. In order to accomplish these goals, Islamic radicals have mainly used terrorism as their main instrument of persuasion. The largest and most active terrorist organizations are those which are state funded. These organizations act as both an overt and covert way of spreading the sponsor countries ideologies. The U.S. Secretary of State has designated seven governments as state sponsors of terrorism: Cuba, Iran, Iraq, Libya, North Korea, Sudan, and Syria.
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In 1766 when he was 8 years old, Robert Hyde, Samuel Greg's uncle, who was childless, offered to adopt his nephew. Thomas Greg readily accepted. This was a significant event in the story of Quarry Bank Mill because Robert Hyde himself owned a merchant manufacturing business in Manchester, dealing primarily in fustian, a cloth produced using both linen and cotton. Nearly 30% of the cotton spinning factories set up in the North of England during the early part of Industrial revolution were headed by Manchester fustian merchants.
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It is argued that globalisation allows the world to become increasingly more united, with people more conscious of ethnic, societal, civilizational and individual aspects of their lives. When exploring the topic of globalisation, sociologists have categorised the term into three components, economic, political and cultural globalisation. They have done this in order explain what it means. I have aimed within this essay to explain all three types of globalisation in order to answer the essay question. I intend to concentrate mainly on the economic and cultural influences as each element consists of wide discussions.
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With globalization becoming a basic economic reality, national boundaries have become insignificant. As a result, companies worldwide have shifted their focus from domestic to an international or global arena by extending operations into different parts of the world. As companies become more global minded, the need for managers with global perspective, international experience and skills that translate well to broader global context has increased. These new breed of managers, known as global managers, are those who manage across multiple time zones, country infrastructures, and cultural expectations. A major challenge facing many multinational firms to successfully compete and grow in worldwide markets is the recruitment and development of a cadre of good managers with a global mindset who can succeed in the international market place.
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Information and technology is the heart of economic development and prosperity today. It is modern communication that makes globalisation possible through operations of huge multinational corporations (MNC); for the European service sectors to deal with its customers through a call centre in America, for a manufacturer to design its products in America, makes them in Asia and sell them in Europe.4 This paper tries to look at the impact of information technology on globalisation. In order to do so one has to see the concept globalisation first.
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