Readers Question: Evaluate the significance of the factors which have contributed to globalisation. Globalisation is not a new phenomenon. The world economy has become increasingly interdependent for a long time. However, in recent decades the process of globalisation has accelerated; this is due to a variety of factors, but important ones include improved trade, increased …
The throw-away economy refers to the prevalence of consumer goods which only last for a short period of time. When they stop working / no longer relevant, we throw them away and replace them with new goods. This is in contrast to an economy where resources are more scare – and if a good is …
HS2 is a proposed new railway line linking London Euston to Birmingham and in the second phase – Manchester, Leeds, Sheffield and eventually Scotland. Supporters of high-speed rail argue it is necessary to meet the UK’s rapidly growing demand for travel. High-speed rail will provide the greenest, safest and most efficient form of transport. The …
Collusion occurs when rival firms agree to work together – e.g. setting higher prices in order to make greater profits. Collusion is a way for firms to make higher profits at the expense of consumers and reduces the competitiveness of the market. In the above example, a competitive industry will have price P1 and Q …
What are the advantages and disadvantages of monopolies? Monopolies are firms who dominate the market. Either a pure monopoly with 100% market share or a firm with monopoly power (more than 25%) A monopoly tends to set higher prices than a competitive market leading to lower consumer surplus. However, on the other hand, monopolies can …
A duopoly is a market structure dominated by two firms. A pure duopoly is a market where there are just two firms. But, in reality, most duopolies are markets where the two biggest firms control over 70% of the market share. Characteristics of duopoly Strong barriers to entry in the market, e.g. brand loyalty (Coca-cola …
Furlough schemes involve the government paying the wages of workers who would otherwise have been laid off. In the UK, the government pay 80% of wages up to £2,500 a month. Over 7.5 million jobs are now covered by the scheme. It is costing £8bn a month and has helped avoid a surge in unemployment. …
A look at the arguments for and against privatisation. Privatisation involves selling state-owned assets to the private sector. It is argued the private sector tends to run a business more efficiently because of the profit motive. However, critics argue private firms can exploit their monopoly power and ignore wider social costs. Privatisation is often achieved …