Prices and incomes policy

inflation-1970s

Prices and incomes policy is an attempt by the government to set the rate of increase in prices and the rate of wage increases in the economy. The government do not seek to control individual prices but control the general rate of increase in prices and incomes. Price and incomes policy may involve ‘voluntary’ agreements …

Read morePrices and incomes policy

Purchase vs subscription models

In recent years, many markets have shifted from a model of one-off purchases to subscription models. One-off purchases involve a single transaction and the consumer gets a product permanently Subscription models involve monthly transactions and the consumer gets the product for only as long as they keep paying. For example, we used to buy records …

Read morePurchase vs subscription models

Government policies to reduce collusion

policies-reduce-collusion

Collusion involves firms coming to an agreement to artificially raise prices and increase profitability at the expense of consumers. Collusion can lead to significant welfare loss and governments have sought to prevent it through a variety of policies, including: Fines for firms found guilty of collusion Fines and jail sentences for company executives who are …

Read moreGovernment policies to reduce collusion

Sustainable growth

uk-economic-growth-annual

Sustainable economic growth implies that the growth rate can be maintained over the long term. Sustainable growth involves both Environmentally sustainable growth – e.g. not exploiting scarce resources. Sustainable growth in terms of low inflation and a balanced economy. Sustainable economic growth The long-run trend rate of economic growth is the rate of economic growth …

Read moreSustainable growth

Why is value of Yuan so important?

devaluation-in-yuan

Summary – impact of devaluation in Yuan If the Yuan falls in value, Chinese exports will become cheaper compared to other countries (e.g. US, India, EU) A falling Yuan will increase demand for Chinese goods contributing to higher growth in China. However, a fall in the Yuan will make US and Indian goods relatively more …

Read moreWhy is value of Yuan so important?

Labour market regulation

national-minimum-wage-pros-cons

Government intervene in labour markets to overcome market failure, protect workers health and safety and to reduce inequality. Government labour market regulations include. Maximum working weeks Statutory minimum wages Legislation to prohibit discrimination Protection against unfair dismissal. Health and safety legislation Right to join trade unions Legislation to auto-enroll workers in private pensions Regulations about …

Read moreLabour market regulation

Will Covid recession lead to a new era of austerity?

uk-national-debt-since-1727-annotated

The Covid recession is very expensive for governments. Not only are we experiencing the usual cyclical fall in tax receipts, but there has been unprecedented government spending – such as the furlough scheme for workers, loans for business and a large rise in welfare payments. Government borrowing will increase to record peacetime levels. In April …

Read moreWill Covid recession lead to a new era of austerity?

Item added to cart.
0 items - £0.00