• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Economics IA: Insiders and Outsiders

Extracts from this document...


ECONOMICS I.A * Economics commentary number: SL 1 * Title of extract: Insider and outsiders * Source of extract: The Economist (UK issue) * Date of extract: October 28th-November 3rd 2006 * Word count: 749 * Date the commentary was written: January 19, 2007 * Section of the syllabus to which the commentary relates: Section 3 * Candidate name: Alexander Cameron Ward * Candidate number: 000719-041 * Key Words: Unemployment, Structural Unemployment, Technological Unemployment, Continental Social Model, Real Wage Unemployment. France matters and its problems cannot be ignored. France is the world's sixth-biggest economy, boosted by the evermore powerful multinational-firms of the CAC 40 (French stock market index). The nation is a declared nuclear power and responsible for centuries of economic, philosophical, and technological innovation. However, in the last decade France has entered what some may call an era of declinism. Its economy has lost ground: unemployment has reached 10%, the public debt amounts to 66% of GDP (Gross Domestic Product: Value of a country's total output of goods and services before depreciation) ...read more.


* Structural unemployment refers to unemployment resulting from fundamental changes in the economy. * Technological unemployment is the result of technological changes reducing the direct demand for labour. * Real Wage Unemployment has many aspects but is generally caused by government imposed restrictions such as minimum wage for example that are imposed above equilibrium and therefore employers are not willing to offer jobs. * The Continental Social Model is the social model in use in France. It has strict employment regulations and a large amount of directive in industry. Nevertheless, the labour market has proven to be inflexible and slow to react to globalization. However, generous insurance-based unemployment benefits and a well funded welfare state have resulted in a commendable reduction in poverty and the provision of high quality health care. After the 30 years of post World War Two prosperity, more commonly known as the trente glorieuses, France emerged as one of the world's leading industrial powers. ...read more.


The social-security contributions for an employee can cost the employer the equivalent of half that employee's salary. Furthermore, once employees are hired for a full-time job, to dismiss them, even for legitimate reasons, can sometimes be more expensive then keeping them. It is therefore clear that employing someone is a big risk and can lead to the employer developing negative criteria when considering applicants (racial, age and sex discrimination) in other words: negative externalities. To counter the heavy unemployment and general instability in France, the French government is going to have to revise their social model, turning away from the continental model and going towards a more flexible and liberal model like the Danish one: Flexicurity. The Flexicurity social model enables a more flexible job market whilst insuring that those who lose their jobs are still properly protected and can therefore count on employment benefits. Unfortunately, in a country where even the slightest reform is welcomed by mass protest it seems that such a transformation will not be accomplished over night. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our International Baccalaureate Economics section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related International Baccalaureate Economics essays

  1. Unemployment IA

    bailout like Greece and Ireland. Read more: http://www.dailystar.com.lb/article.asp?edition_id=10&categ_id=3&article_id=123230#ixzz1BfNIeF2q (The Daily Star :: Lebanon News :: http://www.dailystar.com.lb) Unemployment Internal Assessment For the first time in many months Spain is experiencing an unemployment rate drop, even though it is the country in Europe with the highest unemployment rate.

  2. Extended Essay Economics

    employees hired specifically to ensure that solvencias are submitted to CADIVI on time. (Khandelwal) These waiting times are a hindrance to a company's functionality and these additional costs make it difficult for a company to be profitable. This 'red tape' occurs in all parts of the world, and it is especially common in developing countries.

  1. Economics HL - IA

    local forests in Japan, in order to increase the efficiency of the chopstick production, by lowering the cost of production. In theory, if the Japanese government decides to enact these laws, Japanese manufactures of chopsticks will now supply more at any given quantity because they have the incentive to do

  2. MacroEconomic IA -Japanese Unemployment

    The structural reform including deregulation in labour market and business,cutting cooperative taxes and aim to revive the competitiveness. In my opinion, due to the liberalizing in labour market, the workers will receive lower wage and also working in bad condition.

  1. What has happened to Canada's demographic over the past 50 years? What are ...

    Older people cannot regulate sleep as well as young employees, and thus can be impacted heavily by a drastic change in work hours. For young employees, it usually isn?t a problem to change hours. However, older employees might need a greater recovery time to adapt to the new change.

  2. Is there possibilities of war for resources?

    Such ?political barrels? are estimated to be 44 percent of the total reserves OPEC claims. Russia?s reserves are also uncertain but probably 30?40 percent lower than officially claimed. Some countries have been extracting large amounts of crude but maintaining the same proven reserves figures.

  1. 15 Historical Economic Questions on Mercatilism and the Development of European Countries.

    Four years after the wake of the depression in 1933, the Glass-Steagall was created which brought about the FDIC. The Federal Deposit Insurance Corporation operates as an independent agency, which provides insurance on bank deposits, made by regular people. Knowing that the population?s financial welfare holds the key to economic

  2. Price discrimination

    Whether price discrimination is for profit maximisation or other reasons, it redistributes well-being or benefit in the market. The logic adapted here is that market agents derive benefits from market participation. One aspect of this redistribution is the additional profits reaped by a price-discriminating seller.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work