Readers Question: Are People hungry because the world does not produce enough food? No. Essentially it is a problem of distribution. In particular, in developing countries, many people lack sufficient income to buy enough food The United Nations, World Food Programme WFP, states 925 million people do not have enough to eat and 98 percent …
Despite the weakness of the UK economy, the Pound is forecast to rise against the Euro, due to the ongoing uncertainty surrounding the debt crisis in the Eurozone. With Greece and other countries at risk of default, and even facing the prospect of a Euro break up, the Pound Sterling looks relatively attractive – despite …
Readers Question: when I read the EU spends 50% of their GDP, what does that actually mean? That half of Europe’s taxes are spent on government projects like welfare and entitlements, like taking money from the left hand pocket and putting money in the right hand pocket? I’m lost. Could you please use credit cards …
If someone is claiming unemployment benefits should the government be able to make them work a full-time jobs to remain eligible for benefits? You could argue that if someone is receiving unemployment benefits, offering them ‘job experience’ may have certain benefits. Benefits of Unemployed having to Work It makes sure people are not claiming benefits …
Readers Question: Is large government spending bad for economic growth? to what extent does empirical evidence support this assertion? How Government Spending Might Lead to Lower Economic Growth Higher spending leads to higher taxes. Higher income taxes may discourage people from working. High corporation tax might discourage firms from setting up in that country. (e.g. …
This is a list of government spending as a % of GDP. The highest on this list is Zimbabwe with 97.8% of GDP. Amongst developed countries, the highest levels of government spending include Iceland (57%), Sweden (52%) and France (52.8%) China’s government spending accounts for only 20% of GDP
Readers Question: The number of Rhinos that are killed every year for their horns is increasing. They may soon be extinct. What would an economist do about this? An economist would say that if Rhinos are at risk of becoming extinct it would impose a significant social cost on society. Therefore the economic incentives should …
A joke – Three guys walk into a bakery; an investment banker, a government employee, and a tea partier. The lady behind the counter puts out a dozen cookies. The investment banker pockets 11 and tells the tea partier the damn government worker is trying to steal his cookie. There was a time when bank …