Economics Paper 1 essay: Can someone please mark this 😂😂😂
Question:
Some economists argue that the increase in food prices, caused by the rapid rise in biofuel production, is a major cause of famine and poverty in some of the world’s economies ’ (Extract C, lines 1-2).
Using the data and your economic knowledge, evaluate the case for and against governments intervening to prevent agricultural products from being used to produce biofuel.
[25 marks]
Answer:
Government intervention is when the government intervenes in the free market due to an apparent market failure. Government failure is when government intervention leads to a worsening of resources than the original market failure.
There is an interrelationship between food and biofuel as they are in composite demand. Due to rising incomes in China and India, demand for biofuel has increased, attracting farmers to switch their production from food to more biofuel production.
The diagram demonstrates the impact of changes in inter-related goods in a market. Biofuel demand shifts outwards from D to D1 due to the increased incomes in developing countries such as China and India. As a result, output increases from Q to Q1 and price rises from P to P1. A direct effect to this is a fall in production of food from Q to Q1 due to a fall in supply from S to S1 and therefore a price rise from P to P1. clearly, there are signs of market failure. For instance, the price rise of food is lending to potential food shortages and famine which can be devastating for an economy. It can also lead to greater inequality, with the price rise being regressive, it is a greater burden to low-income families.
Furthermore, one type of government intervention to correct this market failure is to subsidise farmers in the production of food. A subsidy is money given to a firm to lower their costs of production, so that they can supply more.
The subsidy shifts supply from S1 to S2 where food output increases from Q to Q1 and prices fall from P to P2. This means that prices are cheaper for consumers to buy food, it would eventually lead to a fall in biofuel due to the direct relationship to food. However, a subsidy is costly and the costs may outweigh the benefits of the subsidy. This in turn can cause government failure as the revenue budget could have been spent better elsewhere e.g. healthcare and education and therefore, there is an opportunity cost. In addition a subsidy may not be used for its intended purpose and a firm may use the subsidy to pay shareholders higher dividends, meaning that the subsidy will have little or no overall effect on increasing food production.
Another type of government intervention may be regulation. One regulation might be a limit on the production of biofuel, tackling the problem directly. A limit would restrict output, resulting in an increase in the price and therefore, we will see a contraction in demand for biofuel. However, this may or may not be effective if enforcement and punishment is not strict enough. For instance, if enforcement is not strong enough then it won’t be effective in restricting output and farmers may not comply, especially if the punishment is not as severe. There will also be the need for policing which would incur costs for the government and the high costs could lead to possible government failure.
On balance, I would argue that goods such as food, so necessary for the global economy should not be limited, especially as there is a global food shortage. Government intervention is important, especially where it could lead to food shortages and famine. However, government intervention should be kept to a minimum, as the free market may be able to self-correct itself, as it could lead to potential government failure and cause unintended consequences.
Some economists argue that the increase in food prices, caused by the rapid rise in biofuel production, is a major cause of famine and poverty in some of the world’s economies ’ (Extract C, lines 1-2).
Using the data and your economic knowledge, evaluate the case for and against governments intervening to prevent agricultural products from being used to produce biofuel.
[25 marks]
Answer:
Government intervention is when the government intervenes in the free market due to an apparent market failure. Government failure is when government intervention leads to a worsening of resources than the original market failure.
There is an interrelationship between food and biofuel as they are in composite demand. Due to rising incomes in China and India, demand for biofuel has increased, attracting farmers to switch their production from food to more biofuel production.
The diagram demonstrates the impact of changes in inter-related goods in a market. Biofuel demand shifts outwards from D to D1 due to the increased incomes in developing countries such as China and India. As a result, output increases from Q to Q1 and price rises from P to P1. A direct effect to this is a fall in production of food from Q to Q1 due to a fall in supply from S to S1 and therefore a price rise from P to P1. clearly, there are signs of market failure. For instance, the price rise of food is lending to potential food shortages and famine which can be devastating for an economy. It can also lead to greater inequality, with the price rise being regressive, it is a greater burden to low-income families.
Furthermore, one type of government intervention to correct this market failure is to subsidise farmers in the production of food. A subsidy is money given to a firm to lower their costs of production, so that they can supply more.
The subsidy shifts supply from S1 to S2 where food output increases from Q to Q1 and prices fall from P to P2. This means that prices are cheaper for consumers to buy food, it would eventually lead to a fall in biofuel due to the direct relationship to food. However, a subsidy is costly and the costs may outweigh the benefits of the subsidy. This in turn can cause government failure as the revenue budget could have been spent better elsewhere e.g. healthcare and education and therefore, there is an opportunity cost. In addition a subsidy may not be used for its intended purpose and a firm may use the subsidy to pay shareholders higher dividends, meaning that the subsidy will have little or no overall effect on increasing food production.
Another type of government intervention may be regulation. One regulation might be a limit on the production of biofuel, tackling the problem directly. A limit would restrict output, resulting in an increase in the price and therefore, we will see a contraction in demand for biofuel. However, this may or may not be effective if enforcement and punishment is not strict enough. For instance, if enforcement is not strong enough then it won’t be effective in restricting output and farmers may not comply, especially if the punishment is not as severe. There will also be the need for policing which would incur costs for the government and the high costs could lead to possible government failure.
On balance, I would argue that goods such as food, so necessary for the global economy should not be limited, especially as there is a global food shortage. Government intervention is important, especially where it could lead to food shortages and famine. However, government intervention should be kept to a minimum, as the free market may be able to self-correct itself, as it could lead to potential government failure and cause unintended consequences.
I can't tell if this is an AS or A2 question, I'm going to assume it's AS and in my opinion this would achieve mid to high level 4. 17-20 marks, The reason being you make good detailed points however I feel there is a severe lack of context and application. Apart from that I believe the essay is good. For your intro one key term is enough possible include some context and the set the scene i.e In this essay I will be evaluating whether government intervention in agricultural products is necessary.
If this is an A2 question I'm afraid to say this will be a level 3 due to the lack of A2 content. Perfect competition could be used when talking about agriculture how the goods are homogenous, in terms of regulation you could be more specific such as price floor where a minimum price is charged.
If this is an A2 question I'm afraid to say this will be a level 3 due to the lack of A2 content. Perfect competition could be used when talking about agriculture how the goods are homogenous, in terms of regulation you could be more specific such as price floor where a minimum price is charged.
Personally I believe that its a good essay but I wouldn't say that its great due to the limited evaluation and the actual flow of the essay. I say overall I would grade you a 17, now I may be being a little harsh but that's whats best I say.
Whats great about this essay is your interpretation of the question and how you provide examples all the way through your exam. Also it seems like you would have given a great diagram with a great explanation of the shifts.Pinpointing each reason.
What I would say that needs improving is your flow of the essay, there merely isn't enough chains of analysis which is why @cominca believes you don't know much about the situation. Also would be great to see some more BUTS in your essay with clear evaluation, almost as if you are bouncing back and fourth.
REMEMBER QUALITY OVER QUANTITY. The examinars don't wish that you have 3 or 4 points they state it would be nice but what they would prefer more would be 2 extremely detailed paragraphs with your points application explanations analysis and evaluation.Come on , I know it ,you know it and the cat down the street knows it, you wont have enough time in the exam to write 3-4 detailed really good paragraphs so don't overwork yourself.
But throwing myself back to the topic. Yes its good and definitely will score you some points ,its all about how many you want. My best recommendation if your struggling is to have a look at the examiners report because who knows more about the exam than the examiner themselves.
If you have any other essays you want some advice on im always free, well upto Monday that is and maybe Thursday
Whats great about this essay is your interpretation of the question and how you provide examples all the way through your exam. Also it seems like you would have given a great diagram with a great explanation of the shifts.Pinpointing each reason.
What I would say that needs improving is your flow of the essay, there merely isn't enough chains of analysis which is why @cominca believes you don't know much about the situation. Also would be great to see some more BUTS in your essay with clear evaluation, almost as if you are bouncing back and fourth.
REMEMBER QUALITY OVER QUANTITY. The examinars don't wish that you have 3 or 4 points they state it would be nice but what they would prefer more would be 2 extremely detailed paragraphs with your points application explanations analysis and evaluation.Come on , I know it ,you know it and the cat down the street knows it, you wont have enough time in the exam to write 3-4 detailed really good paragraphs so don't overwork yourself.
But throwing myself back to the topic. Yes its good and definitely will score you some points ,its all about how many you want. My best recommendation if your struggling is to have a look at the examiners report because who knows more about the exam than the examiner themselves.
If you have any other essays you want some advice on im always free, well upto Monday that is and maybe Thursday
Is this for GCSEs? If so, what board?
Im sure its AS Level Micro economics and I think its AQA
Original post by SlightlySummer
Is this for GCSEs? If so, what board?
Ohh ok thanks
Original post by EW,WHAT?
Im sure its AS Level Micro economics and I think its AQA
According to Public Health England, poor air quality is the largest environmental risk to public health in the UK. In particular, diesel cars are estimated to be responsible for 40 000 premature deaths each year. In response, the Government announced in 2017 that it would ban the sale of new petrol and diesel cars by 2040
Explain why the use of petrol and diesel cars may be a source of market failure. [15 marks]
Market failure occurs when the price mechanism fails to allocate scarce resources efficiently and where there is a net social welfare loss.
One reason as to why petrol and diesel cars may be a source of market failure os because they create negative externalities in production and consumption. Petrol and diesel cars are demerit goods which have negative spillover effects to the third party, the third party being society. For instance, petrol and diesel cars emit toxic gases which contribute to heavy air pollution, leading to poor air quality. This affects society in many ways. For example, it has led to lower life expectancy of 1.5 years and has been recently discovered to affect lung development, especially in the young and elderly in congested areas. As a result, car pollution leads to health issues and puts greater strain on the NHS by exhausting medical resources.
(INSERT NEGATIVE EXTERNALITIES IN CONSUMPTION DIAGRAM)
The diagram shows the marginal private benefit is higher than the marginal social benefit meaning that there is no account being taken by individuals the negative externalities pollution from petrol and diesel cars has on society. The cost to society is depicted in the diagram, from the shaded area, showing the welfare loss to society as there is a high level of consumption of petrol and diesel cars. The socially optimal level is not being achieved and so potential government intervention may be needed unless the free market is able to self-correct through the price mechanism. Therefore, this would give reason to why petrol and diesel cars may be a source of market failure.
Can someone check if my essay is good (i'm in A level Yr2). - Is it too short for a 15 marker, I feel as though it's too short, but then again this question doesn't require evaluation. Thanks
Explain why the use of petrol and diesel cars may be a source of market failure. [15 marks]
Market failure occurs when the price mechanism fails to allocate scarce resources efficiently and where there is a net social welfare loss.
One reason as to why petrol and diesel cars may be a source of market failure os because they create negative externalities in production and consumption. Petrol and diesel cars are demerit goods which have negative spillover effects to the third party, the third party being society. For instance, petrol and diesel cars emit toxic gases which contribute to heavy air pollution, leading to poor air quality. This affects society in many ways. For example, it has led to lower life expectancy of 1.5 years and has been recently discovered to affect lung development, especially in the young and elderly in congested areas. As a result, car pollution leads to health issues and puts greater strain on the NHS by exhausting medical resources.
(INSERT NEGATIVE EXTERNALITIES IN CONSUMPTION DIAGRAM)
The diagram shows the marginal private benefit is higher than the marginal social benefit meaning that there is no account being taken by individuals the negative externalities pollution from petrol and diesel cars has on society. The cost to society is depicted in the diagram, from the shaded area, showing the welfare loss to society as there is a high level of consumption of petrol and diesel cars. The socially optimal level is not being achieved and so potential government intervention may be needed unless the free market is able to self-correct through the price mechanism. Therefore, this would give reason to why petrol and diesel cars may be a source of market failure.
Can someone check if my essay is good (i'm in A level Yr2). - Is it too short for a 15 marker, I feel as though it's too short, but then again this question doesn't require evaluation. Thanks
(edited 4 years ago)
I'd say its a decent 15 marker and that's what I'd probably write as well. Being a market failure question I believe this is fine as honestly, idk myself what else I would write. However, majority of candidates would probably come out with the same response. In terms of marks I'd say it would be around 10-12, for 15 there would be more detail needed but then again idk what i'd add myself it does see, relatively short for 15 marker.
Original post by Alenko333
According to Public Health England, poor air quality is the largest environmental risk to public health in the UK. In particular, diesel cars are estimated to be responsible for 40 000 premature deaths each year. In response, the Government announced in 2017 that it would ban the sale of new petrol and diesel cars by 2040
Explain why the use of petrol and diesel cars may be a source of market failure. [15 marks]
Market failure occurs when the price mechanism fails to allocate scarce resources efficiently and where there is a net social welfare loss.
One reason as to why petrol and diesel cars may be a source of market failure os because they create negative externalities in production and consumption. Petrol and diesel cars are demerit goods which have negative spillover effects to the third party, the third party being society. For instance, petrol and diesel cars emit toxic gases which contribute to heavy air pollution, leading to poor air quality. This affects society in many ways. For example, it has led to lower life expectancy of 1.5 years and has been recently discovered to affect lung development, especially in the young and elderly in congested areas. As a result, car pollution leads to health issues and puts greater strain on the NHS by exhausting medical resources.
(INSERT NEGATIVE EXTERNALITIES IN CONSUMPTION DIAGRAM)
The diagram shows the marginal private benefit is higher than the marginal social benefit meaning that there is no account being taken by individuals the negative externalities pollution from petrol and diesel cars has on society. The cost to society is depicted in the diagram, from the shaded area, showing the welfare loss to society as there is a high level of consumption of petrol and diesel cars. The socially optimal level is not being achieved and so potential government intervention may be needed unless the free market is able to self-correct through the price mechanism. Therefore, this would give reason to why petrol and diesel cars may be a source of market failure.
Can someone check if my essay is good (i'm in A level Yr2). - Is it too short for a 15 marker, I feel as though it's too short, but then again this question doesn't require evaluation. Thanks
Explain why the use of petrol and diesel cars may be a source of market failure. [15 marks]
Market failure occurs when the price mechanism fails to allocate scarce resources efficiently and where there is a net social welfare loss.
One reason as to why petrol and diesel cars may be a source of market failure os because they create negative externalities in production and consumption. Petrol and diesel cars are demerit goods which have negative spillover effects to the third party, the third party being society. For instance, petrol and diesel cars emit toxic gases which contribute to heavy air pollution, leading to poor air quality. This affects society in many ways. For example, it has led to lower life expectancy of 1.5 years and has been recently discovered to affect lung development, especially in the young and elderly in congested areas. As a result, car pollution leads to health issues and puts greater strain on the NHS by exhausting medical resources.
(INSERT NEGATIVE EXTERNALITIES IN CONSUMPTION DIAGRAM)
The diagram shows the marginal private benefit is higher than the marginal social benefit meaning that there is no account being taken by individuals the negative externalities pollution from petrol and diesel cars has on society. The cost to society is depicted in the diagram, from the shaded area, showing the welfare loss to society as there is a high level of consumption of petrol and diesel cars. The socially optimal level is not being achieved and so potential government intervention may be needed unless the free market is able to self-correct through the price mechanism. Therefore, this would give reason to why petrol and diesel cars may be a source of market failure.
Can someone check if my essay is good (i'm in A level Yr2). - Is it too short for a 15 marker, I feel as though it's too short, but then again this question doesn't require evaluation. Thanks
On the 'quality over quantity' point - when introducing a term, should you define and explain how it works?
I've watched some Tutor2u essay technique videos and they tend to skip some of the definitions. In my own essays however I've really been waffling on with both definition and then an explanation of how whatever I'm defining works.
I've also heard contrasting advice - to assume the examiner isn't an economist and explain every little detail?
I've watched some Tutor2u essay technique videos and they tend to skip some of the definitions. In my own essays however I've really been waffling on with both definition and then an explanation of how whatever I'm defining works.
I've also heard contrasting advice - to assume the examiner isn't an economist and explain every little detail?
Original post by EW,WHAT?
Personally I believe that its a good essay but I wouldn't say that its great due to the limited evaluation and the actual flow of the essay. I say overall I would grade you a 17, now I may be being a little harsh but that's whats best I say.
Whats great about this essay is your interpretation of the question and how you provide examples all the way through your exam. Also it seems like you would have given a great diagram with a great explanation of the shifts.Pinpointing each reason.
What I would say that needs improving is your flow of the essay, there merely isn't enough chains of analysis which is why @cominca believes you don't know much about the situation. Also would be great to see some more BUTS in your essay with clear evaluation, almost as if you are bouncing back and fourth.
REMEMBER QUALITY OVER QUANTITY. The examinars don't wish that you have 3 or 4 points they state it would be nice but what they would prefer more would be 2 extremely detailed paragraphs with your points application explanations analysis and evaluation.Come on , I know it ,you know it and the cat down the street knows it, you wont have enough time in the exam to write 3-4 detailed really good paragraphs so don't overwork yourself.
But throwing myself back to the topic. Yes its good and definitely will score you some points ,its all about how many you want. My best recommendation if your struggling is to have a look at the examiners report because who knows more about the exam than the examiner themselves.
If you have any other essays you want some advice on im always free, well upto Monday that is and maybe Thursday
Whats great about this essay is your interpretation of the question and how you provide examples all the way through your exam. Also it seems like you would have given a great diagram with a great explanation of the shifts.Pinpointing each reason.
What I would say that needs improving is your flow of the essay, there merely isn't enough chains of analysis which is why @cominca believes you don't know much about the situation. Also would be great to see some more BUTS in your essay with clear evaluation, almost as if you are bouncing back and fourth.
REMEMBER QUALITY OVER QUANTITY. The examinars don't wish that you have 3 or 4 points they state it would be nice but what they would prefer more would be 2 extremely detailed paragraphs with your points application explanations analysis and evaluation.Come on , I know it ,you know it and the cat down the street knows it, you wont have enough time in the exam to write 3-4 detailed really good paragraphs so don't overwork yourself.
But throwing myself back to the topic. Yes its good and definitely will score you some points ,its all about how many you want. My best recommendation if your struggling is to have a look at the examiners report because who knows more about the exam than the examiner themselves.
If you have any other essays you want some advice on im always free, well upto Monday that is and maybe Thursday
For a 25 marker ,examiners prefere you to use more analytical and evaluative terms rather than knowledge. They already know that you have knowledge on the subject due to your 10 marker which is more knowledge based, so I wouldn't stress about explaining it. Your definition should be explanatory enough and remember that its not your highest priority. Tutor2u videos are great to watch as it comes from the examiners themselves so definitely approve of your technique there. Don't get me wrong its okay to waffle on but if you waffle its harder to get a clear understanding and may just look as if your not confident about the question which you want to look.
If you look at it in the right view, yes do act as if your talking to someone who doesn't know economics and do explain it in every little detail but that's only relevant in your chains of reasoning. For example you shouldn't say that rising price in food may lead to famine, but a rise in price for NECESSITIES without a change in the consumers disposable income may mean that the consumer will not be able to purchase the inelastic good and therefore this will lead to famine among the consumer. A way to solve this is government intervention …. If that makes any sense.
If your still unsure or I haven't answered in a clear way , feel free to drop a message.
P.S if you want more chains of analysis examples , Tutor2u provide hundreds of them : )
If you look at it in the right view, yes do act as if your talking to someone who doesn't know economics and do explain it in every little detail but that's only relevant in your chains of reasoning. For example you shouldn't say that rising price in food may lead to famine, but a rise in price for NECESSITIES without a change in the consumers disposable income may mean that the consumer will not be able to purchase the inelastic good and therefore this will lead to famine among the consumer. A way to solve this is government intervention …. If that makes any sense.
If your still unsure or I haven't answered in a clear way , feel free to drop a message.
P.S if you want more chains of analysis examples , Tutor2u provide hundreds of them : )
Original post by beachpanda
On the 'quality over quantity' point - when introducing a term, should you define and explain how it works?
I've watched some Tutor2u essay technique videos and they tend to skip some of the definitions. In my own essays however I've really been waffling on with both definition and then an explanation of how whatever I'm defining works.
I've also heard contrasting advice - to assume the examiner isn't an economist and explain every little detail?
I've watched some Tutor2u essay technique videos and they tend to skip some of the definitions. In my own essays however I've really been waffling on with both definition and then an explanation of how whatever I'm defining works.
I've also heard contrasting advice - to assume the examiner isn't an economist and explain every little detail?
Thanks very much - so to summarise be more broad with definitions in the lower mark questions (9 & 15 on my board) and focus more on eval and analysis on the 25's? And make sure chains are broad on all of them?
Original post by EW,WHAT?
For a 25 marker ,examiners prefere you to use more analytical and evaluative terms rather than knowledge. They already know that you have knowledge on the subject due to your 10 marker which is more knowledge based, so I wouldn't stress about explaining it. Your definition should be explanatory enough and remember that its not your highest priority. Tutor2u videos are great to watch as it comes from the examiners themselves so definitely approve of your technique there. Don't get me wrong its okay to waffle on but if you waffle its harder to get a clear understanding and may just look as if your not confident about the question which you want to look.
If you look at it in the right view, yes do act as if your talking to someone who doesn't know economics and do explain it in every little detail but that's only relevant in your chains of reasoning. For example you shouldn't say that rising price in food may lead to famine, but a rise in price for NECESSITIES without a change in the consumers disposable income may mean that the consumer will not be able to purchase the inelastic good and therefore this will lead to famine among the consumer. A way to solve this is government intervention …. If that makes any sense.
If your still unsure or I haven't answered in a clear way , feel free to drop a message.
P.S if you want more chains of analysis examples , Tutor2u provide hundreds of them : )
If you look at it in the right view, yes do act as if your talking to someone who doesn't know economics and do explain it in every little detail but that's only relevant in your chains of reasoning. For example you shouldn't say that rising price in food may lead to famine, but a rise in price for NECESSITIES without a change in the consumers disposable income may mean that the consumer will not be able to purchase the inelastic good and therefore this will lead to famine among the consumer. A way to solve this is government intervention …. If that makes any sense.
If your still unsure or I haven't answered in a clear way , feel free to drop a message.
P.S if you want more chains of analysis examples , Tutor2u provide hundreds of them : )
Quick Reply
Related discussions
- How to get an A* in Economics?
- A-level Economics Study Group 2022-2023
- how to get all A*s in my a levels
- A levels
- A level revision 2024
- Edexcel A level politics
- AQA A Level Economics Paper 2 (7136/2) -22th May 2023 [Exam Chat]
- Edexcel A Level Politics Paper 3B (9PL0 3B) -16th June 2023 [Exam Chat]
- A level paper remark 2023
- A-level Exam Discussions 2024
- A-level Economics Study Group 2023-2024
- I got A*AA for my A-Levels - ask me anything.
- A-level Business Study Group 2022-2023
- EDEXCEL 2024 A level exams
- AQA GCSE History Paper 1 (8145/1) - 18th May 2023 [Exam Chat]
- AQA A-Level Politics Paper 2 - 7152/2 7 June 2023 [Exam chat]
- Geog vs business which is easier????
- Past exam papers - AQA A level Year 2
- ⭐niamhcheesecake's Yr 11 journal: help me conquer Gcse's :(( ⭐
- AQA A-Level Psychology Support for 2024 exams
Latest
Last reply 1 minute ago
Government Social Research - Research Officer Scheme 2024Last reply 4 minutes ago
Official Cambridge Postgraduate Applicants 2024 ThreadLast reply 5 minutes ago
choosing a medical school (Leicester, St Andrews, Nottingham)Last reply 9 minutes ago
Why do some girls take pleasure in going after other girls boyfriends?Posted 9 minutes ago
LSE undergraduate accommodationLast reply 12 minutes ago
Can someone please mark my AIC essay (my teacher is such an unreliable marker)Last reply 12 minutes ago
JK Rowling in ‘arrest me’ challenge over hate crime lawLast reply 13 minutes ago
CPS Pupillage/Legal Trainee Scheme 2024 (2025 Start)Last reply 13 minutes ago
Best Accommodation for Med Students at University of Plymouth?Last reply 14 minutes ago
Official University of Warwick Offer Holders Thread for 2024 entryLast reply 16 minutes ago
Official London School of Economics and Political Science 2024 Applicant ThreadLast reply 16 minutes ago
Bae systems accommodation barrowLast reply 20 minutes ago
Official University of Edinburgh Applicant Thread for 2024Last reply 20 minutes ago
University of Liverpool veterinary work experience form.Last reply 22 minutes ago
Worried about son who wants to move out, will he be able to afford it?Last reply 23 minutes ago
NICS Staff Officer and Deputy Principal recruitment 2022 2023Last reply 23 minutes ago
Degree Apprenticeship at Accenture (assessment centre)
