Summary: Productive efficiency is concerned with the optimal method of producing goods; producing goods at the lowest cost. Allocative efficiency is concerned with the optimal distribution of goods and services. Example: An economy could be productively efficient in producing large numbers of boots – but if they were all for the left foot, it would …
An economic evaluation of the Labour Manifesto. Most significant elements of Jeremey Corbyn’s Labour Party manifesto include Higher income tax on top 10% of earners Rail re-nationalisation Freezing pension retirement age. Abolition of tuition fees Promise of 30 hours’ free childcare, 10,000 more police officers Brexit – may or may not stay in Single Market. …
Discrimination in the labour market occurs when employers make decisions on wages and employment based on prejudices, such as race, gender, religion. It can lead to variations in wages for the same job and different employment rates. Kenneth Arrow defined discrimination as: “the valuation in the market-place of personal characteristics of the worker that are …
The polluter pays principle (PPP) is a basic economic idea that firms or consumers should pay for the cost of the negative externality they create. The polluter pays principle usually refers to environmental costs, but it could be extended to any external cost. In a purely free market, you would only face your private costs. …
Price discrimination involves charging different prices to different sets of consumers for the same good. Firms can charge different prices depending on several criteria: Quantity bought (e.g. lower unit price when higher quantity is bought) Time of use (higher price at peak times) Age profile (e.g. discounts for OAPs) When unit is bought (e.g. discounts …
Increasing the rates of economic growth has long been the holy grail of conventional economics and politics. To a large extent, most developed economies have been highly successful in increasing economic output. But, has such an impressive increase in national output actually improved people’s standard of living? To decide whether economic growth has increased happiness …
The first admission about writing on the economic policies of Donald Trump is that nobody can be entirely sure what it will be – perhaps even Donald Trump himself. Campaign promises are one thing, but the reality of a Republican controlled Congress, may be something else. I don’t think it unreasonable to think that the …
An examination of the advantages and disadvantages of congestion charges: Some cities, such as London have introduced a congestion charge. The aim of a congestion charge is: Reduce congestion. Therefore reduce time wasted and reduce costs for business Reduce pollution. Fewer cars will lead to less pollution. Make city centres more attractive for pedestrians and …