TSR Economics society
Economics discussion, revision, exam and homework help.
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Goes without saying of course that www.economist.com has plenty of economics related news. You do need a subscription to view some of the stories though
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slipped my mind. Thanks Apagg 
I have promoted you to be the Vice President of this society. I will add this title beside your name in the first post. Congrats.
Guess who is the president
Me!
Last edited by Nuheen; 19-06-2006 at 17:00. -
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Oops, forgot to mention perhaps the most useful part of the Economist for students - http://www.economist.com/research/Economics/ is basically an Economics dictionary, and provides definitions for most terms.
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www.ft.com and http://news.bbc.co.uk/1/hi/business/ are also good. - Don't remember doin wider readin when I was doin A Levels - You people should do well!!
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Ok people, time to start debate
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Topic : War is beneficial to the economy (Apagg contributed this)
You can take only one stance (for or against) and will receive one point for each viable reason. The number of 'Eco' points you win will be shown beside your name in the first post. This is a competition for becoming the number one TSR Economist. WHAT ARE YOU WAITING FOR? Oh yes, the best TSR Economist (of each month) will be given rep points by me ( I know it is only 5 ) but I hope that the others of this society will also do the same. A new topic for debate will be announced after the previous one ends. Suggest a topic and if I select that you will get 2 Eco points. Off you go.
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Apagg I have given you 2 Eco points for this topic. -
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Alright, Economics Debate, finally!!!!(Original post by Nuheen)
Ok people, time to start debate.
Topic : War is beneficial to the economy (Apagg contributed this)
You can take only one stance (for or against) and will receive one point for each viable reason. The number of 'Eco' points you win will be shown beside your name in the first post. This is a competition for becoming the number one TSR Economist. WHAT ARE YOU WAITING FOR? Oh yes, the best TSR Economist (of each month) will be given rep points by me ( I know it is only 5 ) but I hope that the others of this society will also do the same. A new topic for debate will be announced after the previous one ends. Suggest a topic and if I select that you will get 2 Eco points. Off you go.
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Apagg I have given you 2 Eco points for this topic.
Ok i am against the above statement. My reasons are as follows:
*War means that a country has do divert a lot of its resources into prodicing Military and Defence goods, which means that there are fewer consumer goods available meaning that a fall in living standards is expected! If you look at a ppf curve shifting production to non-consumer goods would mean that therre would be an oppertunity cost!
*The oppertunity cost idea: If there was no war all this money could be spent elsewhere, such as education, health, social security, all this would lead to a better welfare state.
*War has a negative impact on consumer and producer confidence. This is because there is increased uncertainty about the future. This means that consumers consume less, and businesses invest less, all leading to a fall in aggregate demand and so an increase in unemployment.
*War would also mean that there would mean that working age men would be called up to fight in the army, reducing the workforce meaning that the economy would not produce at full capacity and so a fall in output would occur leading to further unemployment.
*Although it can be argued that a war would lead to an increase in government spending, and thus AD, i believe that this is not as significant as the decrease in Consumption and Investment. This is because a decrese in consumption and investment would outweigh the increase in government spending. Also however much the government may choose to borrow and spend would lead to an increase in a budget deficit whch would have negetive effects on the economy.
*Another reason for me being against the statement is that a war would lead to damage to a countries infrastructure, such as transport, which would have dire effects on the economy...
Nevertheless all this depends on which stage the countries economy is at, but most importantly the type of war we are talking about. If it is a war overseas the economy maybe less affected... -
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It's simple, War is not beneficial to a country at all. It's stupid to think so, my point:
Look at Iraq.
That's not the most thriving economy and the grip of war has ravished it's somewhat stable economy under Saddam's reign. Previously, you had the surrounding Gulf areas investing in the area if they were able to, but now it's impossible. We also know that they are naturally endowed with a generous vat of Oil, where that is leading them under the US occupation is anyones guess. -
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1. Can I join...
2. I believe war can be beneficial for a country:
ad Wizard *1) Although war costs a lot of ressources and money for a country, the country will make up for the loss due to exploitation of the battle field area (i.e.: USA -> Iraq). If a country wants to benefit from a war, then they can. The american economy benefitted in several ways, because american companies built up new economies in Iraq, which are now already flourishing and the money all goes back to the USA.
ad Wizard *2) In general the money they would lose by never having a war because one of the major sponsors for politics and tax payers is the weapons industry.
But back to the general statement. I don't think one can really judge if war is benefical for the economy, because no war is the same. It all depends on the circumstances (i.e: war on foreign ground or at home, war at land or war at sea, war with a highly developped country or war against an "easy ennemy", point of the war (i.e.: catching a terrorist/rebel, securing a land zone, securing ressources, fighting for an ideal, fighting against a menacing power).
But my overall view is clear: War is beneficial, if you want it to be.
ad Wizard *6) Yes. But only if the war is in your own country, (i.e.: Iraq, where the "intruders" benefitted from the infrastructure being destroyed.
And one point that has to be mentioned (an example why war can even be beneficial for the economy when you lose it):
After WWII the german economy was totally destroyed, after the allies had left the country the germans had the possibility to start totally new economies with the money provided by the marschall plan. They built new industries and within a few years german products where the most exported because of the high quality, because germany had the newest and best industry in Europe.
more to come. -
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This is very true. As for the Iraq war, which let the unemployment rate decrease and the company invest rate increase.(Original post by George Perry, American economist)
Wars have usually been good for the U.S. economy. Traditionally they bring with them rising output, low unemployment and full use of industrial capacity as military demands add to normal economic activity."
Higher expanisions -> economic growthThe National Bureau of Economic Research (NBER) Business Cycle Dating Committee tends to support this view. The strongest expansions were registered during and after major crises - the Civil War, the first and second world wars, the Korea War, throughout most of the conflict in Vietnam and immediately following Operation Desert Storm, the previous skirmish in Iraq.
so true.wars are beneficial to the economy. But they are beneficial because governments engage in Keynesian borrowing and spending during them (which could be directed to social services as well as war
I found these quotes. They might be good for a discussion as I see I am the only one who is in favour of the statement (well there are only 2 against) -
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Exploitation in the battle field area? American companies building up 'economies' in Iraq isn't a sign of success. There is nothing to say whether they have been successful or not. Which type of companies are we talking about? Maybe oil companies, if so, then yes, they are of course successful but at what cost? The lives of the american soldiers which you can't put a value on.(Original post by austrian guy)
1. Can I join...
2. I believe war can be beneficial for a country:
ad Wizard *1) Although war costs a lot of ressources and money for a country, the country will make up for the loss due to exploitation of the battle field area (i.e.: USA -> Iraq). If a country wants to benefit from a war, then they can. The american economy benefitted in several ways, because american companies built up new economies in Iraq, which are now already flourishing and the money all goes back to the USA.
So you're suggesting that the Americans would lose money if they didn't go to war as the weapons industry sponsors politics and tax-payers? America has a huge defence budget which includes the R&D of new weapons. The public sector are able to attract more finances and generally has more influence over the country's policies than any private sector company.ad Wizard *2) In general the money they would lose by never having a war because one of the major sponsors for politics and tax payers is the weapons industry.
After WWII the german economy was totally destroyed, after the allies had left the country the germans had the possibility to start totally new economies with the money provided by the marschall plan. They built new industries and within a few years german products where the most exported because of the high quality, because germany had the newest and best industry in Europe.
more to come. . That's not a REASON for going to war! Who is to say whether the German economy would have not flourished for WWII? America provided a lot of the funds to the EU after WWII which Europe used to later from FTA, Custom Union, Single European Market and EMU leading to Economic Integration in the aim that Europe be made whole just as the US is, except split up into states. At the moment, the European Union makes 40% of the world's exports and the US, Canada & Mexico make for 17%, when you consider the spread of the EU, each country has slightly less exports than the North American country's, my point is, it's not how much money you get but how you use it and reffering to the original example, the Germans flourished because they made efficient use of the funding, if they had the resources available in the first place then there is no saying that they would also have done the same.
Of course, but what do you value more? The protection of your population or economic prosperity? The latter is of no use if the former is not available. The political policies of the Government indirectly affect Economic decisions and vice versa. Political parties make decisions to win votes in the end and votes are won by what is clearly seen by the population in the short-term."Wars have usually been good for the U.S. economy. Traditionally they bring with them rising output, low unemployment and full use of industrial capacity as military demands add to normal economic activity." -
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from: http://www.rationalrevolution.net/wa...y_all_abou.htm Very long article explainig the US economic interest in IraqThese are the main things I believe the Bush administration was initially concerned with (1997-1999). In addition to these conditions, what made involvement in Iraq in particularly pressing was the state of the Iraqi regime. The situation in Iraq was at a point where it needed resolution of some kind. The Bush administration knew that if they did not actively pursue a resolution that was in their own best interests then some other resolution would be found that would undoubtedly not be as favorable to American oil companies and American economic interests.
Every politician wants himself or his party to be re-elected. The biggest sponsor of the republican party is the US weapon lobby, they keep the party going so in return there has to be work for this industry.So you're suggesting that the Americans would lose money if they didn't go to war as the weapons industry sponsors politics and tax-payers? America has a huge defence budget which includes the R&D of new weapons. The public sector are able to attract more finances and generally has more influence over the country's policies than any private sector company.
Yes it really depends on what you value more. That is the great difference between the republican and the democrat party. Two totally different ways of thinking, and yes the current US government favours economic growth and not welfare.Of course, but what do you value more? The protection of your population or economic prosperity? The latter is of no use if the former is not available. The political policies of the Government indirectly affect Economic decisions and vice versa. Political parties make decisions to win votes in the end and votes are won by what is clearly seen by the population in the short-term.
ad Germany after WWII) It does make a difference if your whole industry is renewed and all of your competitors have to cope with older factories. "Made in Germany Products" avanced to the most popular products of that era and this wouldn't have been possible without the new infrastructure.
Exploitation in the battle field area? American companies building up 'economies' in Iraq isn't a sign of success. There is nothing to say whether they have been successful or not. Which type of companies are we talking about? Maybe oil companies, if so, then yes, they are of course successful but at what cost? The lives of the american soldiers which you can't put a value on.
I'll post this and add a list of US companies in Iraq when I find it..
Edit 1: news flashes on companies in Iraq -
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Source: http://www.publicintegrity.org/wow/report.aspx?aid=65 (excellent article, really worth reading)WASHINGTON, October 30, 2003 — More than 70 American companies and individuals have won up to $8 billion in contracts for work in postwar Iraq and Afghanistan over the last two years, according to a new study by the Center for Public Integrity. Those companies donated more money to the presidential campaigns of George W. Bush—a little over $500,000—than to any other politician over the last dozen years, the Center found.
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