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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).
Royal authority had declined during the weak rule of Henry IV and it needed to be asserted and there was also the problem of law and order (lots of disorder in Castile due to the 5 years civil war). There were still supporters of Joanna; a minority of the nobility had fought against Isabella e.g Marquis of Vienna. The Hermandad at least brought some justice to the countryside, which benefited Castilian towns as well as law-abiding landowners. Hermandades had never been controlled so extensively by the Crown, it significantly contributed to the improvements in local administration.
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Introduction to Globalisation Definition: Globalisation can be defined as ' the intensification of worldwide social relations which link distant localities in such a way that local happenings are shaped by events occurring many miles away and vice versa' (Giddens 1990). It has also been described as ' process which embodies a transformation in the spatial organisation of social relations and transactions - assessed in terms of their extensity, intensity, velocity and impact - generating transcontinental or inter-regional flows and networks of activity'.
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Design, reliability, availability and image are some of the factors which determine the purchase of goods. UK imports and exports of goods & services The UK trades both in goods and services. Since 1955 exports of goods has accounted for approximately three quarters of total exports whilst exports of services have accounted for one quarter. Foreign trade has increased at a faster rate than that of national income. In 1955, total exports accounted for 24% of national income; by 1998 this had risen to 30.4%.
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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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The main reason goods are not manufactured in places such as Great Britain is because it is cheaper abroad. The wage you pay the worker is less and also companies do not have to pay any taxes or export duties. These countries are known as trade free zones. In these countries you can fire any workers who ask for a raise as well as cheating workers out of wages and making them work unpaid overtime whenever you want. On top of this the governments in these countries would not interfere if you dumped toxic by-products as there are no environmental laws and they would 'bend over backwards' to build any roads or infrastructures that would aid a company.
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The answers to these questions depend on many factors of which I will attempt to explain further below. (Tordoff w. Government and politics in Africa 4th edn, 2002 pg 25) Some of the reasons given for establishing European colonies in Africa are believed to be economical, political and social. For instance in West Africa, the British missionaries and traders pressurized their home governments to extend the colonial boundaries inland as a means of protecting their interests and gains against the French and German compertition. Another reason is to prolong the the life of declining European capitalism ie secure easy access to raw materials needed to fuel their manufacturing industries established following industrial revolution and also obtain a protected market for their manufactured goods.
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Organisations that were privatised were in the following industries; gas, electricity, water, transport and telecommunications where competition had been very limited in scope. The nationalised industries that were sold to members of the public between 1979 and 1996 included the following:- Associated British Ports, British Airport Authority (BAA), British Energy, British Gas, British Petroleum, British Steel, British Telecom, Cable & Wireless, Enterprise oil, Jaguar ('British Leyland') Rail track, Sealink (British Rail), Water authorities etc In disposing of it assets, governments have used a number of options including selling shares to a single buyer, usually another company or consortium (e.g.-the sale of Rover)
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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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Each at various times benefited from import restraints, subsidies, antitrust exemptions, etc. Let us consider the most common criteria for industrial targeting listed below: 1) National defense 2) Marshallian externalities 3) "High value-added" 4) International oligopoly 5) High technology The high-growth era, 1953-1974 Let us consider some details of each industrial policy tool of the high growth era, beginning with foreign exchange rationing. 1) The rationing of foreign exchange After the end of the Occupation, the government of Japan used authority to restrict inward investment to manage the acquisition of foreign technology by Japanese firms.
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From this, what new labour entails is the sheer fact that people should be equal and everyone has the right to set up large businesses if they required to. Whereas, old labour tend to be stricter on the basis of this and they wanted to reduce this freedom to a great deal as possible. Old labour in the past held incredibly strong emphasis on workers and trade union rights.
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The local agriculture helps support the coaching trade because it would have everything such as food and water for the horses and people, it would have also been used to make the beer. The census shows us that Harlow was a wealthy area because the amount of people employed and how many people to one house. The census also shows how many houses had servants and what sort of jobs there were. In the main there were only two people to a house. The census shows us what sort of jobs there were for example; brewer, butcher, shoemaker and servant.
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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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globalisationGlobalisation has been taking place for hundreds of years, but it has speeded up enormously over the last half-century. Many things have helped speed up the process of globalisation
Globalisation has been taking place for hundreds of years, but it has speeded up enormously over the last half-century. Many things have helped speed up the process of globalisation, including transportation, telephones, the Internet and televisions. Transportation helps people get from place to place and it has become cheap and quick. For example, UK people now holiday all over the world and people from other countries can travel to the UK to look for better-paid jobs. Businesses can more easily ship products and raw materials all over the world making products and services from all over the globe available to UK customers.
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International trade - In this case I choose the country Canada. When doing a research the best information you must find, is the SLEPT analysis. Using this analysis, you are able to know more about the Social, Legal, Economic, Politics and the Technology
However, the return from this land wouldn't be constant the same. In fact the land would suffer from decreased returns. When you buy extra land it would become more and more profitable and it attract a further capital. The allocation of each factor of production to each area of economic activity would be determined by the level of economic rent, which could be earned. When the returns are decreasing, the capital would shift to more profitable activities. International trade theory The international trade theory, also named as the comparative advantage, is focused on comparative costs and how a country could make profit when it had lower costs.
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How reliable are National income statistics as a means of comparing living standards between countries?
The process of calculations of Gross Domestic Product itself encounters problems. There are three methods of calculating GDP and each method is threatened with its own set of problems that can challenge the relative of the national income statistics. Output method is one way of measuring GDP. In this method the total value of home-produced output is imputed. However it needs to be minded that one firm's output is another firm's inputs sometimes. Hence this method has the possibility of double counting wherein the value of the same output is taken twice.
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The failure to cooperate and coordinate macroeconomic policies will leave countries worse off than an outcome involving cooperation
is usually regarded as a classic example of a 'beggar-thy-neighbor' policy because it result in an expansion of domestic output at the expense of foreign output. Assuming fixed exchange rates, in the case in which the foreign country is responsible for fixing the exchange rate, the monetary expansion in the home country will lead to a monetary expansion in the foreign country that is necessary to hold the exchange rate fixed. The result is a global monetary expansion. Second, consider the fiscal policy transmission.
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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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This essay aims to discuss the post-WWI economic disaster, the impacts this had on the international scale and the methods used by the world's economic leaders to implement and establish a new world economy
saw their gold stocks more than doubled to about 40 percent of the world's monetary gold. This enabled them, when they joined the war in 1917, to make loans directly to the Allies. This reversed the role, which they had played throughout the nineteenth century, from net debtor to creditor, a position they would hold well into the 1980s1. The greater economic impacts of the war were astonishing, entire nations saw their budgets interrupted, the previous thoughts about spending and taxes were torn apart and industrial production and patterns of international trade were permanently distorted. Some countries experienced growth in markets formerly dominated by the European nations, such as the Canada, Australia and Argentina in the
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Medical advancement in the 18th century reduced mortality rates and lengthened life expectancies. This resulted in rapid population growth and subsequently, living standards rose and this was accompanied by a new demand for a wider variety of goods and services. The European nations believed if population was increase at its present rate, there would be a point in time where they would not be able to support themselves economically. Industry-orientated countries had long begun running an unfavourable balance of trade. Also, a common perception about foreign territories is not only were they abundant in natural resources (e.g.
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While they find evidence of common trends, they do not rule out long run benefits to diversification. Taylor and Tonks (1989) also find evidence that stock markets move together in the long run after 1979 and suggest that there is no benefit to international diversification in the long run. However, despite the fact there may a correlation between stock markets in the long run, it seems unlikely that this will be detrimental to diversification unless investors have very long horizons.
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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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CRITICALLY EVALUATE THE THEORIES OF ABSOLUTE ADVANTAGE (ADAM SMITH MODEL) AND COMPARATIVE ADVANTAGE (DAVID RICARDO MODEL). TO WHAT EXTENT DO YOU THINK THAT THEY EXPLAIN
(International Business Environments and Operations, 2004). It is easy to see that if countries have an absolute advantage there are advantages to trade. However, what happens if one country has an absolute advantage over its trading partners in the production of a number of goods? Specialisation and trade can still result in there being welfare gains made from trade. A country has a comparative advantage in the production of a good or service that it produces at a lower opportunity cost than its trading partners.
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National governments and regulatory agencies all over the world have typically set accounting and auditing processes. Each country has historically had its own set of procedures. "Now, the developing global economy and growth in cross-border financing are creating an environment that would benefit from greater harmonization of accounting standards at both the international and the national levels" (Roussey, 1994). Harmonization will require the assistance of investors, business analysts, corporations, organizations, government bodies and any others involved in offshore financial matters. History Efforts to coordinate are not new. The European Union's formation of The Treaty of Rome in 1957 had a similar goal in mind - to create a system of legal and economic harmony.
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Without a doubt, Europe has a much bigger influence in the economy with those around them than Africa, which will explained in detail as to why and what significance this has. In addition, ways in which Africa can improve themselves, become stronger and start to have more influence on economies around them will be discussed. In addition, points will be raised as to how Africa can improve its economy to gain more status and influence as that of Europe. The main economic indicators that will be used will mainly be trade/ industry but will however cover briefly areas such as finance and GDP growth.
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