Category: Essential Economics for Business: Ch 12
A recent report from the World Bank has suggested that developing countries need to grow significantly if they are to avoid high levels of poverty. The report suggested that without rapid and sustained growth up to 4 billion people could be living in abject poverty by 2050.
‘Choose growth or accept poverty for billions’ Guardian (22/5/08)
The Doha dilemma The Economist (29/5/08)
Questions
| 1. |
Summarise the main findings of the World Bank report. |
| 2. |
Is rapid economic growth (a) a necessary condition and/or (b) a sufficient condition for alleviating poverty in developing countries. |
| 3. |
Evaluate two policies that a developing country could adopt to raise levels of economic growth. |
Russia has been growing rapidly. Average earnings have recently been growing at 20% a year and consumption growth has not been far behind this. Moscow apparently has more ‘6-series BMWs’ than any other city in the world. With Vladimir Putin now the prime minister he has promised to rein in inflation and boost social spending on housing and infrastructure. So what are the prospects for Russia in the next decade?
Russia: giant of a new economic world order Observer (25/05/08)
Vladimir Putin pledges to transform economy of Russia into a world leader Times Online (9/05/08)
Putin in 2020 pledge on economy BBC News Online (8/05/08)
Questions
| 1. |
Assess the recent economic performance of the Russian economy. |
| 2. |
Examine the importance of oil to the Russian economy. What can the Russian government do to reduce the dependence on oil revenues? |
| 3. |
Discuss the importance of infrastructure and spending on other social capital for the development of the Russian economy. |
The market for rice has been in turmoil recently with shortages and rapid price rises. This crisis has led to Japan and the USA negotiating a deal to release the surplus rice held by Japan in silos. It is estimated that this deal would lead to around 1.5 million tonnes of rice being made available and this could help reduce the price of rice on global markets.
Japan’s silos key to relieving rice shortage Times Online (17/5/08)
Tokyo stockpiles rice while others go short Times Online (17/5/08)
Thai cartel idea outrages consumers Times Online (3/5/08)
Controlling crops goes against the grain Times Online (3/5/08)
Questions
| 1. |
Explain why Japan is holding surplus rice in silos. |
| 2. |
Assess the impact of this ‘distortion’ on the global rice market. |
| 3. |
With reference to the last two articles linked above, assess the likely impact of the cartel proposed by the Thai prime minister on the global market for rice. |
A significant illegal trade in ‘e-waste’ has developed with thousands of discarded computers arriving every day in the ports of West Africa. Once there, children are often used to dismantle them and extract metals . However, this has resulted in huge toxic dumps and serious health problems for resident in the surrounding area.
Breeding toxins from dead PCs Guardian (6/5/08)
Questions
| 1. |
Identify the principal external costs resulting from this illegal trade in e-waste. |
| 2. |
Using diagrams as appropriate, show the impact of this market failure on the market for new computers. |
| 3. |
Evaluate two policies that the international community could adopt to reduce this illegal trade in e-waste. |
Given the interdependence of the global economy, the economic slowdown in the West is likely to have worldwide knock-on effects. How serious will these effects be for the emerging economies of South East Asia? The following articles consider this question.
The decoupling debate The Economist (6/3/08)
Can Asia escape the effects of the downturn in the West? Times Online (17/3/08)
Just enough power to save themselves Times Online (25/3/08)
Questions
| 1. |
Explain the term emerging economy. |
| 2. |
Discuss the extent to which the economic performance of the emerging economies will help reduce the likelihood of recession in the UK. |
| 3. |
Discuss the extent to which the economic performance of the emerging economies is likely to be affected by recession in the USA. |