Turn on thread page Beta
    Offline

    19
    ReputationRep:
    It's not automatically unfair at all, and yes, it's a value judgement. But it's not equitable. Equity is a value judgement, but it's not the only one.
    Offline

    13
    ReputationRep:
    Hmm, what definition are you using for equitable? As far as I'm aware it's more or less synonymous for unfair
    Offline

    19
    ReputationRep:
    (Original post by Apagg)
    Hmm, what definition are you using for equitable? As far as I'm aware it's more or less synonymous for unfair
    I tend to think of equity as being a desire for people to have similar amounts, to limit disparity between people. While that usually correlates with fairness, polluter pays is often seen as fair, but in practice hits the poorest the hardest. Similarly the libertarian argument that I should get the proceeds of my work and the state shouldn't be able to touch it, is a moral argument and seen by its proponents as fair, but is clearly inequitable. Whereas wealth redistribution is also a moral argument and also seen as its proponents to be fair, but is distinctly equitable. But that's semantics really.

    The main argument I'd make is that efficiency reasons are clearly present in c and f, and while moral reasons may have played a part in the political decision, they're neither equity nor economic arguments. Also, while polluter pays is primarily a moral argument, given the issues with Coase Theory in real life, it's actually a good efficiency motivation as well: since amounts of money for environmental issues (or smoking and drink driving) are usually very large, preferences aren't quasi-linear. As such, you get a different equilibrium if the polluter pays to pollute than if the polluted pays for abatement. While I haven't looked at it in depth, I've seen articles suggest that the polluter pays version is closer to estimated social optimums than the other way around.

    Or to summarise, I think the efficiency arguments are far stronger than the equity ones, and thus putting both for c and f, while correct, seems to show an inability to say which is the primry motivation. If someone asks what causes climate change and you reply "cow's farts and the burning of fossil fuels", while both are technically correct, simply saying "burning of fossil fuels" is probably a better argument as the cow's farts bit is such a small reason in comparison.
    Offline

    11
    ReputationRep:
    Hi guys, I'm doing some IB economics multiple choice questions but I'm not sure about a couple:

    1) Which of the following is a likely consequence of inflation?
    A a reduction in the nomina rate of interest
    B a redistribution of income from the governement to taxpayers
    C a redistrbution of income from borrowers to lenders
    D an increase in administrative costs

    I know that during inflation government expenditure increases due to the rise in the public sector wage bill and increased social security benefits...so therefore, is the answer B?

    EDIT: Or maybe it's D because firms will have raise costs??

    2) Which of the following must occur if a country's price level rises?
    A a fall in the value of money
    B a decline in the volume of exports sold
    C an increase in real wages
    D an increase in the real burden of taxation

    I think it's A as people's purchasing power goes down. This is a must, wheres B, C and D may but they might not depending on other circumstances...?

    Thank you very much!
    Offline

    2
    ReputationRep:
    Hi!

    1) Answer D, you have to consider all the price changes, relabeling, renegotiations of wage increases....
    B, you gave a decent argument, however the recipients are not currently taxpayers, so I'd discount B

    2) harder this because inflation may be caused by a wage spiral, which puts people in higher tax brackets. I'd opt for A.
    Offline

    11
    ReputationRep:
    (Original post by MeAndBubbles)
    Hi!

    1) Answer D, you have to consider all the price changes, relabeling, renegotiations of wage increases....
    B, you gave a decent argument, however the recipients are not currently taxpayers, so I'd discount B

    2) harder this because inflation may be caused by a wage spiral, which puts people in higher tax brackets. I'd opt for A.
    Thanks very much MeAndBubbles. I think I agree with you there for both of those.
    Offline

    10
    ReputationRep:
    (Original post by Graphix)
    Hi guys, I'm doing some IB economics multiple choice questions but I'm not sure about a couple:

    1) Which of the following is a likely consequence of inflation?
    A a reduction in the nomina rate of interest
    B a redistribution of income from the governement to taxpayers
    C a redistrbution of income from borrowers to lenders
    D an increase in administrative costs

    I know that during inflation government expenditure increases due to the rise in the public sector wage bill and increased social security benefits...so therefore, is the answer B?

    EDIT: Or maybe it's D because firms will have raise costs??

    2) Which of the following must occur if a country's price level rises?
    A a fall in the value of money
    B a decline in the volume of exports sold
    C an increase in real wages
    D an increase in the real burden of taxation

    I think it's A as people's purchasing power goes down. This is a must, wheres B, C and D may but they might not depending on other circumstances...?

    Thank you very much!
    I agree for the second question on A. You could also argue for C in question one. When there is inflation in the economy the interest rate rises to combat it. As such, this increases the cost of repayments for people say with morgages or loans, and thus leads to movement of income from borrowers to the lenders, which is answer C.
    Offline

    11
    ReputationRep:
    (Original post by starcarton)
    I agree for the second question on A. You could also argue for C in question one. When there is inflation in the economy the interest rate rises to combat it. As such, this increases the cost of repayments for people say with morgages or loans, and thus leads to movement of income from borrowers to the lenders, which is answer C.
    I see. That is a good argument. Now I'm unsure of what to put. But I think I'll stick with D as a rise in admin costs seems almost ineveitable if there is a sustained rise in prices, yet with C, that only occurs if interest rates rise and they may not do in all cases??? I think...
    Offline

    19
    ReputationRep:
    (Original post by starcarton)
    You could also argue for C in question one. When there is inflation in the economy the interest rate rises to combat it. As such, this increases the cost of repayments for people say with morgages or loans, and thus leads to movement of income from borrowers to the lenders, which is answer C.
    (Original post by Graphix)
    I see. That is a good argument. Now I'm unsure of what to put. But I think I'll stick with D as a rise in admin costs seems almost ineveitable if there is a sustained rise in prices, yet with C, that only occurs if interest rates rise and they may not do in all cases??? I think...
    You're right, D is the answer. C is the opposite: if inflation rises, it means the real interest rate falls, making debt cheaper and saving provide less real return. As such, it is a transfer from net lenders to net borrowers, which is the opposite of C. B is also entirely false, as higher inflation means lower earnings limits (when you pay a higher tax rate) in real terms.
    Offline

    1
    ReputationRep:
    I'd like to learn about macro/micro-economics in depth somewhat, so I'm looking to find some sort of book on it/them. I don't really want a textbook where it's forced learning, but more of a 'traditional' book on the topics. Preferably a classic book on macro economics, and a classic book on micro-economics. Perhaps I'm awful at explaining it, but kind-of like how "The communist manifesto" is to marxism; I'd like something like that, but to micro-economics. Like, the founding book of the theory and principles behind it.

    Is "The Wealth of Nations" by Adam Smith relevant? Someone help me and sort me out of my confusion, please. :confused: . If I didn't explain myself well, just say, and I'll have another go at it :P
    Offline

    11
    ReputationRep:
    (Original post by Drogue)
    You're right, D is the answer. C is the opposite: if inflation rises, it means the real interest rate falls, making debt cheaper and saving provide less real return. As such, it is a transfer from net lenders to net borrowers, which is the opposite of C. B is also entirely false, as higher inflation means lower earnings limits (when you pay a higher tax rate) in real terms.
    Yes. Thanks Drogue for that clarification.
    Offline

    0
    ReputationRep:
    Hope this isnt too vague but i have a problem answering essay type questions for edexcel past papers. i know alot of the info such as definitions etc. problem is i do not know how to word my answers properly and how to apply it to the data/question.
    So is there a certain technique as i keep getting Ds...
    Thanks
    PS im doing unit 2 and 3...help thanks
    Offline

    15
    ReputationRep:
    (Original post by babyepiphany)
    Hope this isnt too vague but i have a problem answering essay type questions for edexcel past papers. i know alot of the info such as definitions etc. problem is i do not know how to word my answers properly and how to apply it to the data/question.
    So is there a certain technique as i keep getting Ds...
    Thanks
    PS im doing unit 2 and 3...help thanks
    For essays, essentially just read the question, think of a certain amount of points (markschemes will tell you how many points they're looking for in order to obtain a certain amount of marks) and then do each point in turn - giving it a good paragraph.

    After each point do another paragraph of evaluation on that point. As for data, make sure you sprinkle it through the answer - you don't need to do a lot of analysis on it, literally just a sentence explaining that the data backs the theory you've just described will suffice.

    I'm sorry I can't really be more helpful - in general, that format will be sufficient for you to gain top marks. However, from what I remember, the last question of unit 3 is ALWAYS about Fiscal policy/Monetary policy - so if you know your stuff (interest rates/taxation+Gov Spending and their impacts) and memorise the evaluation points, you'll breeze through the exam. Best of luck!
    Offline

    2
    ReputationRep:
    (Original post by Kneechuh)
    I'd like to learn about macro/micro-economics in depth somewhat, so I'm looking to find some sort of book on it/them. I don't really want a textbook where it's forced learning, but more of a 'traditional' book on the topics. Preferably a classic book on macro economics, and a classic book on micro-economics. Perhaps I'm awful at explaining it, but kind-of like how "The communist manifesto" is to marxism; I'd like something like that, but to micro-economics. Like, the founding book of the theory and principles behind it.

    Is "The Wealth of Nations" by Adam Smith relevant? Someone help me and sort me out of my confusion, please. :confused: . If I didn't explain myself well, just say, and I'll have another go at it :P

    Paul Samuelson wrote a big book on student level Economics. Original material is published as scientific research papers, there are lots of books found in the reference section of an advanced text on microeonomics. Orgianal or seminal books by Debreu, Samuelson, can't think...

    Your library might stock the General Theory by Keynes. Personally I wouldn't bother reading Wealth of Nations.
    Offline

    0
    ReputationRep:
    I have a problem with this question:

    Consider an Akerlof modelin which firms are risk neutral and have additives technologies. WOrkers have individual productivities, @ that uniformly distributed on [0,6]. A worker has an opportunity cost of [email protected] of being employed by a firm. Each worker privately observes his own type.

    Find the equilibrium wage and allocation of labour

    Thanks
    Offline

    19
    ReputationRep:
    (Original post by Kneechuh)
    I'd like to learn about macro/micro-economics in depth somewhat, so I'm looking to find some sort of book on it/them. I don't really want a textbook where it's forced learning, but more of a 'traditional' book on the topics. Preferably a classic book on macro economics, and a classic book on micro-economics. Perhaps I'm awful at explaining it, but kind-of like how "The communist manifesto" is to marxism; I'd like something like that, but to micro-economics. Like, the founding book of the theory and principles behind it.

    Is "The Wealth of Nations" by Adam Smith relevant? Someone help me and sort me out of my confusion, please. :confused: . If I didn't explain myself well, just say, and I'll have another go at it :P
    Other than a textbook, there isn't something like the Communist Manifesto for economics. A textbook will explain the theory and principles. For something easier to read, that will explain economic some concepts in a more discursive way, I'd thoroughly recommend The Accidental Theorist by Krugman. There are many interesting popular economics books on different topics, though few cover that wide a range. I'd leave old books well alone, partly because they're written in a style that's hard to understand, but mainly because economics has changed completely since Adam Smith. Macroeconomics after Keynes and Friedman in the 40s and 50s is entirely different than before, and microeconomics has changed completely since game theory and asymmetric information ideas were introduced in the 50s-70s. Reading anything general on economics before these will give a very different picture.

    Also, most 'traditional' papers, things which were the first to say major new theories or ideas, will almost all be academic papers. Far harder to study than a textbook. I'm happy to recommend some of them if you'd like to try, though without the backing of an entry-level textbook, it may be quite hard going.
    Offline

    19
    ReputationRep:
    (Original post by thling06)
    I have a problem with this question:

    Consider an Akerlof modelin which firms are risk neutral and have additives technologies. WOrkers have individual productivities, @ that uniformly distributed on [0,6]. A worker has an opportunity cost of [email protected] of being employed by a firm. Each worker privately observes his own type.

    Find the equilibrium wage and allocation of labour

    Thanks
    Are you sure you've written that right? If OC = [email protected] then the higher productivity someone is, the lower their opportunity cost, and hence the lower the wage they'll accept. This means if the firm gave no wage, only the workers with a productivity of 6 would work.
    Offline

    0
    ReputationRep:
    How would you define the term "stop-go" in economics?
    Is it the boom-bust associated with the business cycle of the economy, or policies aiming for stable economic growth?
    Offline

    0
    ReputationRep:
    (Original post by Drogue)
    Are you sure you've written that right? If OC = [email protected] then the higher productivity someone is, the lower their opportunity cost, and hence the lower the wage they'll accept. This means if the firm gave no wage, only the workers with a productivity of 6 would work.
    That is what I was thinking about but the question was writtened as such! I have copied word for word. BUt to find the equilibrium wage (technically speaking) is to find the W= E(@) which is the average of the productivity as the OC is the same for all workers then equate it with E(@/ [email protected] < W) which is the akerlof equilibrium right to find the equilibrium wage? I just want to make sure if I got it right.
    Offline

    2
    ReputationRep:
    (Original post by Lord Marmaduke)
    How would you define the term "stop-go" in economics?
    Is it the boom-bust associated with the business cycle of the economy, or policies aiming for stable economic growth?

    is it an economic term? or a journalist writing? I'd guess it was either late 60s or 70s term to descibe Balance of Payments problems, effecting the possibilities of the government to use fiscal stimulus. ie, fiscal stimulus - big deficit - stop fiscal - balance back in surplus.
 
 
 
Reply
Submit reply
Turn on thread page Beta
Updated: October 11, 2018

University open days

  • University of Bradford
    All faculties Undergraduate
    Wed, 21 Nov '18
  • Buckinghamshire New University
    All Faculties Postgraduate
    Wed, 21 Nov '18
  • Heriot-Watt University
    All Schools Postgraduate
    Wed, 21 Nov '18
Poll
Black Friday: Yay or Nay?

The Student Room, Get Revising and Marked by Teachers are trading names of The Student Room Group Ltd.

Register Number: 04666380 (England and Wales), VAT No. 806 8067 22 Registered Office: International House, Queens Road, Brighton, BN1 3XE

Write a reply...
Reply
Hide
Reputation gems: You get these gems as you gain rep from other members for making good contributions and giving helpful advice.