TSR Economics society

My first post in this thread, so excited

Can anyone suggest good introductory material on public economics, but which takes beyond A-level syllabus?

My lecture on 'The Destruction of the Science of Monetary Policy'
http://www.youtube.com/watch?v=tozcz80db9M&feature=share

Dr Stephen Davies (IEA) -
http://www.youtube.com/watch?v=9DWlz-pzRVs
History and Economics of Public Spending

WATCH AND ENJOY

Thanks for posting. Dr Stephen Davies was very interesting and refreshingly easy to understand for an economist. Or maybe that's because he's actually a historian.

Intersting little PROBLEM - please help

Had this debate in class today. To do with income inequality.

Would changing the 40% marginal tax rate from being applied to income over £45K to incoem over £43K widen or narrow inequality ?
Ceteris paribus, all gross incoems remaining constant.

I would have thought inequality would definitely decrease because your bringing the net incomes of everyone earning over £43,000 down?
However people would argueing that it would depend on how many people were at either end of the income scale

How would it change the lorenz curve also ?

Well, ceteris paribus, the direct effect would be to decrease the disposable income of those earning above £43,000, and hence decrease income inequality because £43,000 is above the average (both median and mean) income level (i.e. people who had above average income now have less than they did before). It would have no direct effect on those earning below £43,000. However, it is arguable that there are indirect effects via, for instance, changes in consumption - those earning above £43,000 tend to have higher marginal propensity to spend, so they will reduce spending disproportionately, lowering aggregate demand and perhaps even causing a rise in unemployment (which tends to increase income inequality). There may also be other indirect effects like tax avoidance which might need to be considered. In short, I agree with you on the direct effect but things aren't ceteris paribus in reality.

I swear high earners have a lower marginal propensity to spend - because they can afford to save unlike those on low incomes ? so if there was this tax change. But it would cut AD (ceteris paribus) unless benefits to those poor with higher marginal propensity to consume were simultaneously increased.

Hi guys, thought you might be able to help me with this one:

How can government policy be used to change Britain's high spending, low saving consumer culture?

Thanks

I would be really grateful if you could take a look at my economics blog at: http://thinkaboutecon.blogspot.co.uk/
I also encourage you to comment!

On your most recent post:

Banks are being forced to ring-fence their retail arms here at least through the recommendations by the Vicker's Report. The only problem is that its coming into force in 2019. In Europe, doing so would make borrowing even more expensive and pose risk to already temperamental growth and employment levels. Dealing with the structural problems of the finance sector can only come later, once their economies have recovered. Pulling the plug on bailouts or subsidies as you mention now is the worser evil.

It's easy to say doing X and Y will solve these problems but we reach an international consensus on financial regulation nothing is going to change.