In the lead up to the Euro debt crisis, there was a marked divergence in competitiveness within the Eurozone. In fact, some economists suggested that the currency imbalances were the root cause of the Eurozone fiscal crisis. (VOX article) However, recent evidence suggests some restoration of competitiveness within the Eurozone. We can examine competitiveness in …
A merger will lead to a bigger firm and a greater market concentration. This can have both advantages and disadvantages for the public interest. A merger is likely to reduce competition and give the new firm more market power. Therefore, it will be able to increase prices leading to a decline in consumer surplus and …
This states that the investment varies with the rate of change of income rather than the rate of interest. This makes investment more volatile if output increase by 2% this can increase the amount of investment by 10%. When there is an increase in orders firms will have to invest in new production capacity. …
Some of the supply side policies used in the UK during the 1980s and 1990s. 1. Privatisation. There has been an extensive privatisation campaign, most of the major utilities such as Gas , Water and Electricity were sold by the government and floated on the stock market. In some industries like telecommunications it has led …
Definition of debt crisis. When a country cannot or will not pay the interest repayments on a debt. In the case of a country these are its external debt commitments. In the 1980s there was a major international debt crisis because several less developing countries in Latin America and Africa defaulted on their debt repayments. …
Definition of Black Market A ‘black market’ is a sector of the economy where transactions occur without the knowledge of the government and usually involve the breaking of certain laws such as filing proper tax returns. Other terms may include Underground market Hidden economy Grey market Unreported markets A black market can also refer to …
Black Thursday – October 24th 1929 signalled the start of the Wall Street Crash and the onset of the Great Depression which caused widespread economic turmoil and political upheaval. Black Thursday was the first large fall in share prices. But, was compounded by huge falls, a couple of days later on Monday 28th and Tuesday …
Building societies evolved in the 18th Century as a way for people to buy a house by pooling savings and mortgages. Many of the early building societies were temporary i.e. the aim was to pay off a mortgage and then close down the building society. However, permanent building societies emerged as more people wished to …