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Microeconomics: IB Economics

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April 3, 2018 6:49 AM

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From www.bbc.co.uk - April 2, 2018 6:42 AM

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The OECD has investigated the impact of artificial intelligence on employment and concludes that despite earlier surveys predicting that the effect on US and UK jobs would be severe, the threat is over-estimated. The OECD view is that AI will affect around 10% of American jobs and 12% of UK jobs.

Of course, the important fact to bear in mind is that the impact of AI is a net one - substitution if they replace workers, but also complementary, in that workers are required to operate the new technology.

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Economy

Microeconomics: IB Economics

A brief overview of relevant articles for IB, A-Level and Pre-U economists relating to microeconomic issues

Curated by Graham Watson

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Today, 4:00 PM

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From www.theguardian.com - Today, 4:58 AM

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A simple example of D&S theory in action - even our new Year 12 economists should be capable of thinking through how higher oil prices are likely to feed through into higher air fares.

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September 1, 3:08 AM

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From www.theguardian.com - September 1, 2:00 AM

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Guardian research suggests that solar panels an save all British households money on their energy bills, even in the cloudiest areas. However, that has to be offset against the installation cost of the panels...

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August 31, 10:18 AM

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From www.theguardian.com - August 30, 10:52 AM

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Excellent Heather Stewart article with lots of applications, that highlights the fact that female empowerment is beneficial both for the women themselves, and the economies where they live. Giving Zambian girls six two-hour lessons teaching them to negotiate with greater confidence improves their economic status, and it's to be hoped that a similar programme in Afghanistan will have the same effect.

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August 26, 3:56 AM

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From www.bbc.co.uk - August 25, 7:07 PM

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OFGEM have announced that the average household energy bill is going up by 4% in October, reaching £1,723 in October, its highest level for 3 years. Not only is it going to increase fuel poverty, and the extent to which people are in energy debt, but it may have knock on effects in terms of consumer confidence, and subsequently consumer spending.

The rise in prices is being attributed to rising natural gas prices, in large part triggered, surprise, surprise by the conflict in the Middle East.

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August 25, 9:55 AM

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From www.youtube.com - August 25, 6:01 AM

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This clip looks at changing consumer tastes, with the growth in popularity of sardines, with a tin of sardines having moved from being a "poverty sardines" to being more of a luxury good.

The article also highlights the implications of higher levels for fishing for the sustainability of the fish stocks that provide the sardines, highlighting the fact that they are a common access resource.

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August 22, 4:30 AM

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From www.theguardian.com - August 21, 4:00 AM

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Think tank, Common Wealth is looking for the government to encourage the uptake of solar panels by establishing a market for solar bonds to lower installation costs. You should be able to depict this on a D&S diagram and also evaluate it relative to other possible interventions.

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August 20, 8:51 AM

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From www.theguardian.com - August 19, 1:39 PM

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Nils Pratley congratulates the Competition and Markets Authority's (CMA) pro-active approach to tackling drip pricing from three firms - Trainline, Virgin Atlantic and RED Driving School. Not only is it in keeping with the Prime Minister's desire to tackle the cost of living, but it sends out a precautionary message to other firms who might be doing the same.

He also notes that it puts Trainline in the headlines, at a time when the launch of Great British Railways might see a publicly-owned alternative emerge.

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August 19, 10:46 AM

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From www.theguardian.com - August 19, 10:29 AM

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Prominent consultancy, Cornwall Insights, is forecasting that the government's energy price cap is going to rise by a further 4% this winter, taking the bill for the average household to "the equivalent of £1,729 a year through the last three months of 2026".

In essence, it will more than offset the government's VAT cut, and contribute to both fuel poverty and the ongoing cost of living crisis.

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August 19, 3:02 AM

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Ulez led to better lung size and function among London children, study finds | Low emission zones | The Guardian | Microeconomics: IB Economics | Scoop.it

From www.theguardian.com - August 18, 6:30 PM

Graham Watson's insight:

Evidence suggesting improved lung capacity in children implies that the ultra low emissions zone (ULEZ) is improving respiratory health in London. However, to what extent can we draw a causal connection? Surely, some of this would have happened anyway because of the rise in the number of electric vehicles, and what other factors might also feed into this.

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August 17, 6:16 AM

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From tourism to power generation and productivity, Europe feels economic cost of heatwaves | Economics | The Guardian | Microeconomics: IB Economics | Scoop.it

From www.theguardian.com - August 16, 4:00 AM

Graham Watson's insight:

Another lovely example of the opportunity cost of the recent European heatwave - whilst it might have increased employment in hospitality and tourism, it's also had adverse effects as detailed in the article.

Across Europe, nuclear power stations have been operating below full capacity because of a lack of river water to cool them down, notably in France, freight has been disrupted along the River Rhine - which carries the bulk of inland water freight in Germany, wildfires in Spain and Italian reliance on tourism mean that all these economies are facing a slowdown.

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August 17, 2:06 AM

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From www.theguardian.com - August 16, 12:28 PM

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I fear that the headline is more eye-catching than the story itself, although it reveals that water companies and regulator, OFWAT, are looking at how water is priced and whether anything can be done to incentivise both better maintenance of the infrastructure, and encourage consumers to have more of an interest is altering patterns of consumption.

However, the possibility of surge pricing will raise hackles, and in economic terms, you'd expect prices to rise if a resource became scarcer, so this is clearly the headline to grab attention.

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August 13, 8:49 AM

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From www.bbc.co.uk - August 13, 6:37 AM

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The government's proposed reform of labour law, giving increased worker protections, most notably for those on zero hours contracts, appears to be likely to have counter-intuitive effects. The problem is that the move will increase costs by somewhere between £300m and £2.9bn and this is going to reduce the incentive to hire workers, potentially increasing unemployment.

This is likely to fall most heavily on young workers who lack human capital and experience, and further worsen youth unemployment.

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August 12, 11:39 AM

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From www.theguardian.com - August 12, 5:18 AM

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Another D&S based story, with tonight's solar eclipse potentially triggering a shortage of electricity, as "between 300 megawatts and 1,100MW of solar power" is taken offline and the demand for power - given the heatwave - remains high.

As a result, the article notes that "The price of electricity for Wednesday evening rose to more than £211.40 per megawatt-hour at 7pm, its highest level since 30 June.", with potentially higher prices being offered to gas power plants to take up the slack.

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September 1, 8:03 AM

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From www.bbc.co.uk - September 1, 7:46 AM

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Excellent Microeconomic article about price determination, with some nice applications to demand theory and PED. IKEA is looking to cut costs because they think that the cost of living crisis has reduced consumer demand, but they are also hoping to drive prices down through cost savings, which of themselves would be likely to result in lower prices.

Of course, the effect of this on total revenues and profits is also dependent upon the PED for Billy bookcases, among other things.

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September 1, 3:04 AM

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From www.bbc.co.uk - August 31, 5:28 PM

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The Federal Trade Commission allege that Amazon has adopted anti-competitive practices in selling advertising, to the detriment of their customers and they, and 22 states, are seeking redress. It comes after the company has also been fined for the way its renewed a number of Prime subscriptions.

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August 27, 2:08 AM

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From www.theguardian.com - August 27, 12:00 AM

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D&S and the price of berries, with a bumper berry harvest likely to mean lower prices of strawberries and raspberries, along with a bumper season for oilseed rape and vineyards. On the flip side, cereal production is down by nearly 15% and salad and vegetable growers have also suffered.

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August 25, 10:00 AM

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Two planned datacentres will have higher UK carbon emissions than ExxonMobil, analysis finds | Datacentres - UK | The Guardian | Microeconomics: IB Economics | Scoop.it

From www.theguardian.com - August 25, 7:04 AM

Graham Watson's insight:

Is this the next environmental blackspot? Data centres.

Analysis by non-profit group Foxglove apparently reveals that the UK carbon emissions will exceed those of ExxonMobil in the UK. The two gas-fired data centres have been expedited through the planning regime via the government’s nationally significant infrastructure project (NSIP) regime

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August 24, 12:08 PM

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Netflix, Disney+ and Amazon price rises in western Europe ‘highest in world’ | Television industry | The Guardian | Microeconomics: IB Economics | Scoop.it

From www.theguardian.com - August 24, 9:45 AM

Graham Watson's insight:

A story that gets right to the heart of demand theory - both in terms of the levels of demand and PED, and YED, as well as in relation to the market power, and price setting ability of streaming services in Western Europe.

High levels of demand, a sense that these goods are now more 'necessary' than before, and thus have a lower YED, and the ability to set price in Western Europe markets all give streaming services, such as Netflix, Disney+ and Amazon greater price setting power than they might be expected to have in other markets.

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August 22, 4:25 AM

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From www.theguardian.com - August 21, 4:12 PM

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Dutch competition authorities have fined Uber $966m for suspending driver accounts without adequately informing them. It's apparently the second largest fine under Europe’s General Data Protection Regulation (GDPR).

The company, of course, is appealing, and no doubt President Trump will see this as yet another European unfairness...

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August 20, 8:30 AM

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From www.bbc.co.uk - August 20, 7:41 AM

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Danone's takeover of Huel is probably best described as conglomerate merger, with the merged company expanding into the nutrition sector, and hoping to gain economies of scope.

The deal has been cleared by the Competition and Markets Authority seemingly because no concerns have been raised over its impact on competition in the sector.

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August 19, 10:39 AM

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From www.bbc.co.uk - August 19, 4:52 AM

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The Competition and Markets Authority has announced that it is going to investigate three firms - Trainline, Virgin Atlantic, RED Driving School - for so-called drip pricing. This occurs when firms don't disclose the entire price of their products up front and instead add-on other charges once the consumer seems committed to the product.

Those of you with knowledge of behavioural economics will appreciate that the companies are exploiting the concept of loss awareness, and that having got a product into their online basket, they will be reluctant not to follow through with the purchase.

Of course, it's exploiting the consumer in making them pay more and hence its being investigated.

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August 17, 2:40 PM

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From www.bbc.co.uk - August 17, 5:34 AM

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I'm starting to prepare material on market structure, and this is a good introduction to how competition changes markets. In the first instance, granting Virgin the right to run trains through the Channel Tunnel removes an artificial barrier to entry and increases the number of firms operating in the market.

However, Virgin still need regulatory approval to operate, but it could be the start of further competition, with Italy's FS Italiane Group subsidiary Trenitalia France also looking to start operating in 2029. Both will obviously increase choice, and put downwards pressure on price, although with a limited number of rivals, might the market tend towards price stability.

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August 17, 4:58 AM

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From www.theguardian.com - August 16, 7:29 AM

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It seems as though the new Prime Minister is keen to protect workers' rights and is looking at increasing worker protections in the gig economy. It's undoubtedly likely to be popular is some circles, but there's an opportunity cost: it's also likely to mean higher prices in these markets too. Unless firms are prepared to accept lower profit margins, then this is almost inevitable.

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August 13, 11:33 AM

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From www.bbc.co.uk - August 13, 7:49 AM

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The water regulator OFWAT has decided to allow water companies to increase their bills by more than expected to finance increased investment in infrastructure. It's controversial because it runs against the current push to keep down the cost of living.

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August 12, 11:40 AM

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From www.youtube.com - August 11, 1:00 AM

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This extended FT clip looks at the housing shortage across the developed world, and the implications of this for their economies. It looks at the purported "housing crisis" - the increased demand for household, the impact of the "superstar" cities and how they affect house prices.

In particular, this is problematic in places like Dublin which has seen a 40% increase in demand for housing and only a 20% increase in housing provision.

It then goes on to look at alternative strategies to tackle this - noting that rent ceilings are good for those people on the housing ladder, but not terribly good for those looking to rent

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Microeconomics: IB Economics

Ryanair warns air fares in Europe will jump next year if oil price stays high | Ryanair | The Guardian

Solar cuts ‘at least £400 from bills in even the cloudiest British areas’ | Solar power | The Guardian

How young women can learn to better wield economic power | Heather Stewart | The Guardian

Household energy bills to hit three-year high as Ofgem announces 4% rise from October

Fishy business: who really profits when sardines go viral? | On the Ground

Cut cost of loans for solar panels on UK homes, ministers urged | Solar power | The Guardian

All power to the UK competition watchdog’s war on ‘drip pricing’ | Nils Pratley | The Guardian

British energy bills forecast to hit three-year high this winter | Energy bills | The Guardian

Ulez led to better lung size and function among London children, study finds | Low emission zones | The Guardian

From tourism to power generation and productivity, Europe feels economic cost of heatwaves | Economics | The Guardian

Water companies in England and Wales explore ‘surge pricing’ during drought | Water industry | The Guardian

Zero hours crackdown could cost firms £2.9bn a year

Great Britain faces electricity supply shortfall during solar eclipse | Energy industry | The Guardian

Ikea cuts prices in bid to woo cash-strapped customers

Amazon rigged billions in ad pricing, lawsuit from states and US watchdog alleges

Top of the crops: record heatwaves help deliver bumper UK berry harvest | Farming | The Guardian

Two planned datacentres will have higher UK carbon emissions than ExxonMobil, analysis finds | Datacentres - UK | The Guardian

Netflix, Disney+ and Amazon price rises in western Europe ‘highest in world’ | Television industry | The Guardian

Dutch regulator fines Uber $966m for automating driver suspensions | Uber | The Guardian

Danone €1bn takeover of Tring based Huel approved by watchdog

Trainline, Virgin Atlantic and RED Driving School investigated over 'drip pricing'

Virgin takes another step towards Channel Tunnel rail services

Burnham urged to crack down on gig economy firms to protect 4m workers | Gig economy | The Guardian

Water bills set to rise for many after firms permitted extra funding

How to fix the housing crisis | FT