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Edexcel Economics Unit 4 Global Economy Discussion Thread (10.June.2014)

Reply 300

Farringtonn

1

What's the advantages and disadvantages of a trading bloc?

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Reply 301

RedDevil014

1

Could someone send me a link of where to get figures and data about different countries that would be relevant to the exam? I have no idea about any data or figures. I really need help.
Thank you.

Reply 302

Spartz

4

Original post by Farringtonn

What's the advantages and disadvantages of a trading bloc?

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Advantages;
Trade Creation; a country in a trading block can enjoy the benefits of having cheaper tariffs and can trade freely leading to growth in both countries

Comparative advantage: countries can specialise within a trading bloc to ensure resources are allocated more efficiently.

Eval.
Trade diversion

If there's a recession within the trading bloc you'll subsequently suffer

Can't reach out to the more developing economy eg BRIC countries

... Anyone think of any more? (sorry just woke up)

Reply 303

Ehawks

7

Original post by cashisking

I'm looking to answer the balance of payments/exchange rates/competitiveness questions.
I've done country profile on UK, Germany, Greece and China, do you think these countries will be enough? I'm a bit worried I won't be able to compare them or relate them to the question. Is there any other countries its worth me having some knowledge on?

Hey.

That should be fine for competitiveness but they also recommend case studies for dev - a country per continent!

Reply 304

cashisking

Original post by Spartz

Advantages;
Trade Creation; a country in a trading block can enjoy the benefits of having cheaper tariffs and can trade freely leading to growth in both countries

Comparative advantage: countries can specialise within a trading bloc to ensure resources are allocated more efficiently.

Eval.
Trade diversion

If there's a recession within the trading bloc you'll subsequently suffer

Can't reach out to the more developing economy eg BRIC countries

... Anyone think of any more? (sorry just woke up)

Member countries are likely to become more attractive in terms of FDI. This is due to ouside countries seeing it as a good investment as they have greater access to trade with the member counties.
Ev:Trading blocs, like the customs unions, which impose common tariffs are likely to suffer from a decline in exports to the tariff countries. This is due to retaliation.

Reply 305

Ehawks

7

Original post by Spartz

Advantages;
Trade Creation; a country in a trading block can enjoy the benefits of having cheaper tariffs and can trade freely leading to growth in both countries

Comparative advantage: countries can specialise within a trading bloc to ensure resources are allocated more efficiently.

Eval.
Trade diversion

If there's a recession within the trading bloc you'll subsequently suffer

Can't reach out to the more developing economy eg BRIC countries

... Anyone think of any more? (sorry just woke up)

Protectionist policies to countries outside trade blocs - custom unions and common markets - not maximising consumer welfare fully!

Reply 306

mhassan

11

Original post by Spartz

Advantages;
Trade Creation; a country in a trading block can enjoy the benefits of having cheaper tariffs and can trade freely leading to growth in both countries

Comparative advantage: countries can specialise within a trading bloc to ensure resources are allocated more efficiently.

Eval.
Trade diversion

If there's a recession within the trading bloc you'll subsequently suffer

Can't reach out to the more developing economy eg BRIC countries

... Anyone think of any more? (sorry just woke up)

Can foreign direct investment be used as strategy to promote growth and development and a policy to reduce poverty?

Reply 307

cashisking

Original post by Ehawks

Hey.

That should be fine for competitiveness but they also recommend case studies for dev - a country per continent!

Crikey, don't think I could remember 7 case studies. I think I'll just stick to the financial questions!

Reply 308

mhassan

11

A question about policies regarding developed countries you write about fiscal policy, monetary policy, benefits, While a question about policies on developing countries you use FDI, tourism to attract investment and NMW, promotion Healthcare and education etc is this correct?

Reply 309

Ehawks

7

Original post by cashisking

Crikey, don't think I could remember 7 case studies. I think I'll just stick to the financial questions!

Documentaries on youtube = life saver and just then apply common sense. That's how I got a case study about Senegal :biggrin:

Reply 310

Ehawks

7

Original post by mhassan

A question about policies regarding developed countries you write about fiscal policy, monetary policy, benefits, While a question about policies on developing countries you use FDI, tourism to attract investment and NMW, promotion Healthcare and education etc is this correct?

Yup yup!

Reply 311

jessyjamjar

Can someone explain to me how the laffer curve works , what it looks like and when it should be used

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Reply 312

mhassan

11

Original post by Ehawks

Yup yup!

Can you please tell me the policies you definitely don't include for developing countries? Always get confused

Reply 313

cashisking

Original post by Ehawks

Documentaries on youtube = life saver and just then apply common sense. That's how I got a case study about Senegal :biggrin:

Interesting. I'll have to see if i can find any on my countries :smile:

thanks

Reply 314

Juseejay

Can someone explain to me the link between capitalism and inequality?

Reply 315

Ff96

1

Original post by jessyjamjar

Can someone explain to me how the laffer curve works , what it looks like and when it should be used

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The Laffer curve is pretty self explanatory once you draw it. Some economists consider that if tax rates are increased too much, tax revenues may actually fall because the disincentives to work are so great. If the higher rate of income tax is increased, then this can also lead to tax avoidance (legal) and tax evasion (illegal)

oh and use it in any tax related question, a good example q to use it in would be June 2011, 1b

(edited 9 years ago)

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Reply 316

aminkaram

Original post by Juseejay

Can someone explain to me the link between capitalism and inequality?

I struggle with this a bit as well. I would say that since FOP are owned by individuals this means that those who own more factors can generate a higher income. For example, if you own more houses you gain more rent etc...

And then for evaluation I would refer to the kuznets curve and also to the fact that governments try to reallocate income so it may not be very drastic.

Reply 317

aminkaram

Original post by Ff96

The Laffer curve is pretty self explanatory once you draw it. Some economists consider that if tax rates are increased too much, tax revenues may actually fall because the disincentives to work are so great. If the higher rate of income tax is increased, then this can also lead to tax avoidance and tax evasion - both which are illegal.

oh and use it in any tax related question, a good example q to use it in would be June 2011, 1b

Just to correct you, tax avoidance is not illegal but tax evasion is. Tax avoidance is defined as taking advantage of loopholes within the law.

Reply 318

aminkaram

Guys in the data response we need to pick up 2 application marks. My question is if I'm struggling to give application in my KAA will I still get the marks by giving application in my evaluation paragraphs?