Microeconomics: IB Economics
36.8K views | +3 today
Microeconomics: IB Economics
Economy
A brief overview of relevant articles for IB, A-Level and Pre-U economists relating to microeconomic issues
Curated by Graham Watson
Your new post is loading...
Your new post is loading...
Rescooped by Graham Watson from International Economics: IB Economics
July 28, 12:37 AM
Scoop.it!

Industrial chicken farming accelerating spread of diarrhoea bacteria, study finds | Chicken | The Guardian

Industrial chicken farming accelerating spread of diarrhoea bacteria, study finds | Chicken | The Guardian | Microeconomics: IB Economics | Scoop.it
From www.theguardian.com - July 27, 3:00 PM
Intensive nature of modern chicken farming creates ideal conditions for campylobacter, allowing bacteria to evolve
Read more
Graham Watson's insight:

This article rather implies that there are negative externalities of industrial chicken farming, something which you might expect, given the low price of supermarket chicken. 

 

However, in enabling farmers to produce at such low cost, does this mean that health and safety is compromised in allowing the spread of diarrhoea bacteria? It would seem so, implying a negative production externality.

more...
Graham Watson's curator insight, July 28, 12:37 AM

This article rather implies that there are negative externalities of industrial chicken farming, something which you might expect, given the low price of supermarket chicken. 

 

However, in enabling farmers to produce at such low cost, does this mean that health and safety is compromised in allowing the spread of diarrhoea bacteria? It would seem so, implying a negative production externality.
Sign up to comment
Scooped by Graham Watson
July 27, 3:14 AM
Scoop.it!

Would you choose £50,000 over the chance of £1m?

Would you choose £50,000 over the chance of £1m? | Microeconomics: IB Economics | Scoop.it
From www.bbc.co.uk - July 26, 7:11 PM
The vast majority of people - particularly women - answer a survey saying they'd take the certainty over chance.
Read more
Graham Watson's insight:

Nice to see the BBC having their stories dictated by social media - however, the example given is a brilliant example of behavioural economics in action. demonstrating the principle of loss aversion, with people feeling losses more acutely than gains. 

 

Rational economic theory would suggest that a 50:50 chance of winning £1m means an expected return of £500,000, and that the rational consumer should choose that but the YouGov survey indicates that this isn't the case and there's also an interesting - and entirely predictable gender split in how people choose. 

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 24, 1:47 AM
Scoop.it!

Oil prices hit $100 for the first time since May

Oil prices hit $100 for the first time since May | Microeconomics: IB Economics | Scoop.it
From www.bbc.co.uk - July 23, 9:55 AM
The price of Brent crude rose more than 6% on Thursday as the war in the Middle East continues to escalate.
Read more
Graham Watson's insight:

D&S and geopolitics. The price of oil is on the rise again, with the conflict in the Middle East seemingly escalating, with Yemeni attacks on Saudi oil tankers. Watch this space.  

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 23, 7:25 AM
Scoop.it!

EU fines Google €890m for competition breaches over search and apps | Google | The Guardian

EU fines Google €890m for competition breaches over search and apps | Google | The Guardian | Microeconomics: IB Economics | Scoop.it
From www.theguardian.com - July 23, 6:00 AM
Firm told to treat third-party services that appear in its results in ‘fair and non-discriminatory manner’
Read more
Graham Watson's insight:

The European Commission has ruled that Google has been acting anti-competitively - again - in favouring its own services in search results and on its app store. The €890m fine for breaching the Digital Markets Act will no doubt not go down well in the White House, if only because the President seems to think that like him, American firms can do no wrong. 

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 22, 2:41 AM
Scoop.it!

Most bus fares in England to be capped at £2 from January

Most bus fares in England to be capped at £2 from January | Microeconomics: IB Economics | Scoop.it
From www.bbc.co.uk - July 22, 1:37 AM
The government says the policy will "help with the cost of living and give people the breathing space they need"
Read more
Graham Watson's insight:

Another cost of living measure, with the Burnham government announcing that they will restore the national price cap on bus fares to £2 from next January, meaning that the rest of the country will come into line with Liverpool and Manchester. 

 

The scheme has certainly had a marginal effect on bus use, and had its most marked effect on low income consumers. However, questions still remain about how effective it's been, given the opportunity cost. 

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 21, 1:59 PM
Scoop.it!

Thames Water investors offer ‘golden share’ in bid to head off nationalisation | Thames Water | The Guardian

Thames Water investors offer ‘golden share’ in bid to head off nationalisation | Thames Water | The Guardian | Microeconomics: IB Economics | Scoop.it
From www.theguardian.com - July 21, 7:55 AM
Move would give government veto over big decisions and hostile takeovers, after Burnham’s call for greater public control
Read more
Graham Watson's insight:

With the prospect of Thames Water going out of business a consortium of creditors are trying to avoid the firm being nationalised by offering the government a 'golden share' in the company and the power to determine big decisions. 

 

The government already holds 'golden shares' in Rolls-Royce and Royal Mail, so it wouldn't be unprecedented. The alternative, is that major creditors seek the full repayment of any outstanding debt, effectively increasing the opportunity cost of nationalisation. 

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 21, 1:47 PM
Scoop.it!

Lindt's Easter chocolate sales fall after price hike

Lindt's Easter chocolate sales fall after price hike | Microeconomics: IB Economics | Scoop.it
From www.bbc.co.uk - July 21, 11:37 AM
The Swiss chocolate maker adjusts its strategy in response to weaker demand after its price rises.
Read more
Graham Watson's insight:

This article looks at the relationship between price, quantity demanded and total revenue, allowing the application of the concept of price elasticity of demand to be thought about. 

 

If "more price-sensitive and mature markets such as Germany, Switzerland and the UK" which constitute some of Lindt's largest markets see a more than proportionate decrease in quantity demanded then total revenue in these markets will fall.

 

However,  be careful - it's not "ceteris paribus" - the article also states that "sales of Lindt chocolate in airports decreased 'due to ongoing conflicts in the Middle East, and therefore declining passenger traffic"'." Thus, demand fell as the price of chocolate rose. 

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 20, 5:02 AM
Scoop.it!

Pay gap widens as UK bosses get 130 times average worker’s salary | Executive pay and bonuses | The Guardian

Pay gap widens as UK bosses get 130 times average worker’s salary | Executive pay and bonuses | The Guardian | Microeconomics: IB Economics | Scoop.it
From www.theguardian.com - July 19, 7:01 PM
In its final report the High Pay Centre says the median remuneration of a FTSE 100 CEO has risen to a record £5.06m
Read more
Graham Watson's insight:

A sad day, with the High Pay Centre issuing its final report highlighting the extent to which there's income inequality, with the average pay of a FTSE CEO reaching £5m, more than 130 times the salary of the average full-time worker. 

 

Even as an Economics teacher, I'd love to be able to make it make sense, but I can't really. Unless you start from the premise that labour markets aren't perfectly competitive and you disregard the concept of marginal productivity. In essence, CEO wages are a lottery, and determined by a narrow group of people - largely non-executive directors who have a vested interest in keeping them high because it feeds back into their own wage. 

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 19, 2:39 PM
Scoop.it!

Chinese firm seeks compensation over British Steel nationalisation

Chinese firm seeks compensation over British Steel nationalisation | Microeconomics: IB Economics | Scoop.it
From www.bbc.co.uk - July 19, 6:59 AM
Jingye said it will take action "through legal means to the very end" after the UK government nationalised British Steel.
Read more
Graham Watson's insight:

The Chinese firm that has seen the UK government nationalise British Steel, Jingye Steel, are seeking compensation. Not much to see here, however, the notion of an "independent assessor" might prove somewhat alien to them. 

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 19, 3:51 AM
Scoop.it!

Andy Burnham considers radical shake-up to cut energy bills | Energy bills | The Guardian

Andy Burnham considers radical shake-up to cut energy bills | Energy bills | The Guardian | Microeconomics: IB Economics | Scoop.it
From www.theguardian.com - July 18, 6:45 AM
Labour leader examining proposals to overhaul gas standing charges and make heat pumps cheaper to run than boilers
Read more
Graham Watson's insight:

It seems that the Prime Minister elect is considering reforming the energy market, by approaching gas standing charges in a new fashion, and potentially writing off existing energy debt, both of which have the capacity to reduce bills. 

 

He's also looking to incentivise the uptake of heat pumps by trying to ensure that electricity prices are lower than gas prices. 

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 16, 10:44 AM
Scoop.it!

British Steel taken into public ownership to protect 'vital' UK supply

British Steel taken into public ownership to protect 'vital' UK supply | Microeconomics: IB Economics | Scoop.it
From www.bbc.co.uk - July 16, 1:22 AM
The Scunthorpe steelworks has been officially nationalised under new government powers passed this week.
Read more
Graham Watson's insight:

The government has formally taken British Steel into public ownership and out of the hands of its previous owner Jingye Steel, who, no doubt, will want compensating. The argument for this is a strategic one, and suggests that there's a national security need for the UK to have a steel industry. 

 

That said, this will have a considerable opportunity cost: the National Audit Office has already noted that keeping the Scunthorpe plant going was costing around £1,3m per day.   

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 14, 6:36 AM
Scoop.it!

UK’s alcohol-free beer boom threatened by regulations, trade body warns | Food & drink industry | The Guardian

UK’s alcohol-free beer boom threatened by regulations, trade body warns | Food & drink industry | The Guardian | Microeconomics: IB Economics | Scoop.it
From www.theguardian.com - July 14, 5:31 AM
BBPA wants content definition for beer to be considered non-alcoholic to be changed from 0.05% to 0.5%
Read more
Graham Watson's insight:

The British Beer and Pub Association (BBPA) are looking for deregulation of the sector, widening the definition of a non-alcoholic beer so that beer with less than 0.5% alcohol can be classified as such. 

 

This comes at a time when the number of consumers buying low-alcohol beverages is on the rise. 

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 13, 5:42 AM
Scoop.it!

Britain’s biggest community solar farm forced to shut over grid overload fears | Solar power | The Guardian

Britain’s biggest community solar farm forced to shut over grid overload fears | Solar power | The Guardian | Microeconomics: IB Economics | Scoop.it
From www.theguardian.com - July 12, 10:00 AM
Timing of Devon switchoff ‘could not be worse’, says board, as members face an estimated £2m in lost revenue
Read more
Graham Watson's insight:

The perils of renewable energy and the limitations of the existing distribution network are laid bare by this article that reports that the largest community solar farm has been forced to shut for the summer over fears that it would otherwise overload and destabilise the grid if allowed to produce electricity. 

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 28, 12:34 AM
Scoop.it!

PM urged to uphold climate pledges made as mayor and ban new North Sea oil drilling | Greenhouse gas emissions | The Guardian

PM urged to uphold climate pledges made as mayor and ban new North Sea oil drilling | Greenhouse gas emissions | The Guardian | Microeconomics: IB Economics | Scoop.it
From www.theguardian.com - July 27, 7:01 AM
Experts who helped Burnham draw up Manchester carbon neutral pledge say backtracking would send wrong message amid wildfires and heatwaves
Read more
Graham Watson's insight:

It could be Micro- it could be Macroeconomic: however, a standard question: to what extent is there a trade-off between economic growth and protection of the environment? 

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 24, 2:05 AM
Scoop.it!

Cleaning up farm emissions? | FT Rethink

From www.youtube.com - July 20, 10:03 PM

Farmers face strict limits on the amount of manure they can reuse as fertiliser as the EU moves to cut nitrogen pollution. But as the FT’s Andy Bounds reports, there could also be profit in surplus muck, in the form of biogas and other resources.

Read more
Graham Watson's insight:

I didn't spot this three days ago but it ties in with my week's work on market failure, in this case the negative externalities associated with farming. In this instance, it's the nitrogen in manure that creates negative externalities when it gets into water supplies, and the EU is looking to cap its use as a fertiliser. 

 

However, ever-innovative farmers can convert manure into biogas that can subsequently be converted into natural gas and also have other nutrients extracted from it. 

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 23, 7:29 AM
Scoop.it!

Carmakers lobbied UK to revoke ban on petrol and diesel cars after 2035 | Electric, hybrid and low-emission cars | The Guardian

Carmakers lobbied UK to revoke ban on petrol and diesel cars after 2035 | Electric, hybrid and low-emission cars | The Guardian | Microeconomics: IB Economics | Scoop.it
From www.theguardian.com - July 23, 3:00 AM
BMW, Ford, Nissan and Toyota, plus parts maker Bosch, wrote joint letter to ministers in April
Read more
Graham Watson's insight:

Turkeys don't vote for Christmas and incentives matter - that's microeconomics in a nutshell. And it should come as no surprise that car manufacturers are lobbying the government to reverse the 2035 ban on the sale of petrol and diesel cars. 

 

However, interestingly, is there now a case for saying that such actions are counter-productive and have meant that EU manufacturers have fallen  behind their Chinese counterparts. 

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 22, 2:23 PM
Scoop.it!

Food price fears after Europe’s heatwave destroys estimated €2bn of crops | Farming | The Guardian

Food price fears after Europe’s heatwave destroys estimated €2bn of crops | Farming | The Guardian | Microeconomics: IB Economics | Scoop.it
From www.theguardian.com - July 22, 10:12 AM
Record June temperatures expected to cut grain harvest by 9m tonnes to its lowest level since 2018
Read more
Graham Watson's insight:

The recent heatwave, D&S, the effect on agricultural productivity and the implications for European food prices. What's not to like? 

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 21, 2:02 PM
Scoop.it!

Burnham has forced greater clarity at Thames Water. Now he must choose | Nils Pratley | The Guardian

Burnham has forced greater clarity at Thames Water. Now he must choose | Nils Pratley | The Guardian | Microeconomics: IB Economics | Scoop.it
From www.theguardian.com - July 21, 1:10 PM
Bondholders are suddenly showing flexibility after 18 wasted months at ailing utility company
Read more
Graham Watson's insight:

Nils Pratley's take on the decision facing the Prime Minister; he's accelerated the process of negotiating over the future of Thames Water but still has to determine which outcome is going to be best for the environment, the government, the taxpayer and consumers. 

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 21, 1:55 PM
Scoop.it!

‘We were at their mercy’: inside the Amazon tactics that hiked prices across the internet | US news | The Guardian

‘We were at their mercy’: inside the Amazon tactics that hiked prices across the internet | US news | The Guardian | Microeconomics: IB Economics | Scoop.it
From www.theguardian.com - July 21, 12:39 PM
Internal emails revealed in court and interviews with ex-employees describe how Amazon’s practices drove up prices for competitors like Walmart and Target. Amazon denies price-fixing claims and says it works to lower costs for consumers
Read more
Graham Watson's insight:

A fascinating look behind the curtain at how why Amazon has been accused of price-fixing, succeeded in driving up the price of goods sold by its competitors, Walmart and Target and potentially abused its dominant position - as a monopsony - relative to its suppliers.

 

It's a little bit warts and all - with internal e-mails and former employee testimony suggesting that the company is guilty of anti-competitive behaviour. However, its executives are canny operators: you don't discuss such practices via e-mail - it leaves a paper trail - discussing it on the phone or via video link makes it far harder to prove. 

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 21, 8:42 AM
Scoop.it!

Mitie agrees £3.1bn takeover by OCS in blow to London stock market | Mitie | The Guardian

Mitie agrees £3.1bn takeover by OCS in blow to London stock market | Mitie | The Guardian | Microeconomics: IB Economics | Scoop.it
From www.theguardian.com - July 21, 5:10 AM
Board of UK government contractor recommends deal with private-equity owned rival
Read more
Graham Watson's insight:

Another mega merger, with government contractor/outsourcer Mitie agreeing to be taken over by rival OCS Group, itself owned by private equity group, Clayton, Dubilier & Rice.

 

Whilst there appear to be potential for economies of scale - the usual platitudes have already been issued by the CEO of OCS, Rob Legge: "We would build a British facilities management group that is better positioned to support the organisations that keep the country running. Together, we can better support existing and new customers, help more people into work and strengthen our contribution to getting Britain moving."

 

So, no truth in the fact that consolidation of the sector might give the group greater market power, which, in addition to lower costs, would boost profits, and presumably the salary of its CEO.  

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 20, 4:54 AM
Scoop.it!

This farmer wanted to quit the cocaine industry - he couldn't

This farmer wanted to quit the cocaine industry - he couldn't | Microeconomics: IB Economics | Scoop.it
From www.bbc.co.uk - July 19, 7:18 PM
Colombians who grow cocaine's raw material bemoan a lack of support to help them switch crops.
Read more
Graham Watson's insight:

This article looks at many issues that are central to economics - incentives, and the operation of the market and the importance of the rule of law and market supporting institutions. 

 

You have to feel sorry for the Colombian farmers - who represent some of the most vulnerable - the returns to farming coca are greater than other crops and more certain the the state aid they've been promised. 

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 19, 4:47 AM
Scoop.it!

Water firms in England and Wales ‘leak five times what hosepipe ban would save’ | Water | The Guardian

Water firms in England and Wales ‘leak five times what hosepipe ban would save’ | Water | The Guardian | Microeconomics: IB Economics | Scoop.it
From www.theguardian.com - July 18, 5:22 AM
Greenpeace UK says 2.87bn litres lost daily, a fifth of all water pumped through network
Read more
Graham Watson's insight:

Greenpeace makes the point that calls for a hosepipe ban are insignificant in comparison to the amount of water lost via the existing leaky infrastructure, with around 20% of all water in the system lost. 

 

So much for the efficient husbanding of a scarce resource. 

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 17, 9:46 AM
Scoop.it!

Why has British Steel been nationalised?

Why has British Steel been nationalised? | Microeconomics: IB Economics | Scoop.it
From www.bbc.co.uk - April 11, 2025 3:20 PM
The UK's only remaining plant making virgin steel has been taken into public ownership after years of uncertainty over its future.
Read more
Graham Watson's insight:

An explainer as to why British Steel's been nationalised within the context of the wider steel industry. It highlights the difficulties of stopping then restarting production and its contribution to the wider economy. 

 

And yet, for all it's strategic value it is also worth noting how globally insignificant it is: "figures for 2023 show the UK produced 5.6 million tonnes of crude steel, or 0.3% of the world's total. In comparison, China produced more than 1,000 million tonnes, 54% of global production."

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 15, 5:19 AM
Scoop.it!

Heating oil customers to get compensation after cancelled orders and price hikes

Heating oil customers to get compensation after cancelled orders and price hikes | Microeconomics: IB Economics | Scoop.it
From www.bbc.co.uk - July 14, 7:00 PM
The cost of heating oil spiked following the US-Israel war with Iran which forced up crude prices.
Read more
Graham Watson's insight:

The Competition and Markets Authority has stepped in to protect consumers in the heating oil market, albeit some producers have already acted to compensate consumers for not honouring pre-agreed contracts after the beginning of the Iran conflict. 

 

It's an intervention designed to bring the market into line with other energy markets.  

more...
No comment yet.
Sign up to comment
Scooped by Graham Watson
July 14, 6:25 AM
Scoop.it!

South East Water must pay £30.5m over supply failures in Kent and Sussex

South East Water must pay £30.5m over supply failures in Kent and Sussex | Microeconomics: IB Economics | Scoop.it
From www.bbc.co.uk - July 14, 4:43 AM
Regulator Ofwat confirms this penalty follows three investigations into the water company.
Read more
Graham Watson's insight:

OFWAT has intervened to force South East Water's hand over supply failures in Kent and Sussex. The company is now obligated to invest in infrastructure to ensure that there's no future recurrence of disruption to water supply.

more...
No comment yet.
Sign up to comment
About Follow us Resources Terms Mobile Features
Facebook
X
LinkedIn