The Governor of the Bank of England, Mervyn King, has signalled that the next year may be the toughest for 15 years with lower economic growth than previously forecast. So, is the UK economy going off the rails?
Questions
| 1. |
Explain the main reasons why the Governor of the Bank of England expects a worse than forecast level of economic growth in 2008. |
| 2. |
Discuss the extent to which a cut in interest rates will help prevent an economic slowdown. What adverse effects could follow from such a policy. |
| 3. |
Discuss one other policy that the government could adopt to try to reduce the extent of the forecast slowdown in economic growth. |
Do you know what the current rate of economic growth is? Probably not. In the article below Larry Elliott argues that this may indicate that the link between economic growth and happiness has been broken and that alternative measures of GDP may be more helpful in analysing the performance of the economy.
Cameron should count on happiness Guardian (27/8/07)
Questions
| 1. |
Explain what is meant by the term ‘Index of sustainable economic welfare’. |
| 2. |
Examine three factors that may raise economic welfare that are not included in a conventional measure of GDP. |
| 3. |
Use the Friends of the Earth make your own ISEW site to analyse the factors that may contribute the most to economic welfare. Discuss the arguments for and against the introduction of an ISEW as an official government measure of economic welfare. |
Now that Tony Blair has announced that he is to step down as Prime Minister, the media has started to consider his legacy. The two articles focus on the economic legacy. While the BBC one is quite factual in its approach, the article by Larry Elliott from the Guardian is less complementary about his legacy.
The business of Tony Blair’s decade BBC News Online (10/05/07)
Blair’s legacy: a fantasy island trying to live beyond its means at every level Guardian (14/05/07)
Blair’s economic record (video) BBC News Online (10/05/07)
Questions |
| 1. |
Explain why Larry Elliott considers that we are living on a ‘fantasy island’. |
| 2. |
Explain the main economic changes that have been implemented during Tony Blair’s time in office. |
| 3. |
Discuss the extent to which the economic situation has improved under Tony Blair for (a) firms and (b) consumers. |
As Nicolas Sarkozy takes over as President of France, he faces a difficult economic situation. Poor economic growth, worsening international competitiveness and a worrying level of unemployment and social unrest mean that he has much to do. His approach will inevitably be controversial and the extent to which he is able to implement his promised reforms may depend on how well he can carry the main stakeholders with him.
Les misérables: France’s unhappy position BBC News Online (7/5/07)
Questions |
| 1. |
Explain the principal economic policies that Sarkozy has promised to implement. |
| 2. |
Discuss the economic problems faced by France. |
| 3. |
Analyse the economic constraints faced by Nicolas Sarkozy as he tries to implement his policies. |
| 4. |
Assess the likely success of the economic policies promised by Sarkozy. |
In a new book, Will Hutton, the editor of the Observer and well-known economic commentator, has argued that we have overstated the economic threat from China. He argues that their economic model is flawed and that extensive corruption in the system is distorting economic growth in the country. The article below from the Guardian is an edited extract from his new book that considers many of these issues.
Power, corruption and lies Guardian (8/1/07)
Questions
| 1. |
“….. the transition from communism remains fundamentally problematic”. Discuss the extent to which these problems are likely to affect the pace of development in China. |
| 2. |
Explain what Will Hutton means by ‘Leninist corporatism’. Why does he believe this to be a problem for China? |
| 3. |
Assess the likely impact of corruption in China on long-term development and the rate of economic growth. |