Economics

Why study this subject?

We live in interesting times. Economics touches our lives every day. The terms low inflation, weak economic growth and poor productivity often appear in newspaper headlines. Who will the UK’s key trading partners be in the future? As a future worker, consumer and voter, studying A Level Economics might be rather useful in helping you to make informed choices. Whilst Economics attempts to analyse the macroeconomic trends seen in newspaper headlines, it also offers an insight into effects that are seen on a microeconomic scale: How do we explain changes in house prices? Why have sales of pizza increased so much in recent years? By its very nature Economics is wide-ranging in scope: it would be much quicker to compile a list of topics without an economic aspect! Economics is a superb bridge between arts and sciences and combines well with Mathematics (particularly statistics), Geography, History (we consider the policy response to the ‘Great Depression’ of the 1930s), Philosophy (we look at some of the great economic thinkers), Politics and Modern Languages. We use up to date examples, contexts and data throughout our teaching to ensure students see the real-world applications of the subject.

What skills will you develop?

Studying Economics brings opportunities to acquire many skills that will help students not just at university but also in later careers. Literacy skills are developed through the recommended wider reading programme and the frameworks provided when writing comprehensive and cohesive essays. We ask L6 economists to read two key texts across the year. This year’s recommendations were The Almighty Dollar by Dharshini David and Who Cooked Adam Smith’s Dinner by Katrin Marcal. There is plenty of scope for budding journalists to produce and edit for a range of magazines: Equilibrium, Equilibrium Lite and The Invisible Hand. We also expect most students to try their hand at least one external essay competition such as those run by the John Locke Institute, the RES and the NCH. Oracy is developed through regular presentation of topical news items in class; participating in the annual Inter-school Economics Debate Competition hosted by the GS, or leading discussions at the schools’ Economics Societies events. From comparing GDP per capita and evaluating Gini co-efficient data, to calculating various elasticities of demand and supply, numeracy skills are at the fore of our day-to-day tasks and activities. Economics helps people to think strategically especially when using data to make decisions and optimise the outcome. Assessment objectives include analysis and evaluation, and students will regularly practise exam style questions to ensure they know how to reach the highest attainment level for each of these key skills. We hope that students will be curious about the subject and be willing to question the perceived wisdom. Both GS and BS departments encourage students to engage in independent research, developing their understanding of a topic of particular interest beyond the exam specification, such as behavioural economics or the economics of healthcare, using a range of academic resources and attending public lectures at the LSE and the RES.

What are the key elements to the course?

Whilst we tend to study the two branches of Economics, Microeconomics and Macroeconomics, independently, as shown below in the key themes for Years 1 and 2; throughout the course students are encouraged to recognise the links between them and apply them synoptically to a range of contexts and scenarios.

Introduction to Markets and Market Failure

The key principles of supply and demand determine the price of everything that is traded, from a loaf of bread to a premiership footballer. But these forces don’t always allocate resources efficiently. Translation: leave things to the “free market” and we get excessive carbon dioxide emissions and alcohol consumption but not enough healthcare and education. So, the government needs to get involved, but how? Might “government failure” be worse than “market failure”?

The UK Economy – Performance and Policies

What is a successful economy? How do we measure its performance? What do we mean by the terms: economic growth, inflation and the balance of payments? How is unemployment measured and how can it be reduced? What are the causes and effects of changes in interest rates and taxation? Studying this unit will give you an understanding of the challenges that confront the government, the Chancellor of the Exchequer and the Monetary Policy Committee of the Bank of England.

Business Behaviour and the Labour Market

How do businesses behave in theory and in practice? We will study a variety of market structures from the apparently highly desirable situation of intense competition to the evils of its opposite: monopoly. But might a single producer sometimes be the best outcome? Theoretical ideas will be brought to life by real examples. We’ll also look at the labour market: what explains the extraordinary difference between the incomes of executives on the top floor of those impressive new buildings in the City and the ‘less than living wage’ paid to the people who clean them. Should we raise the minimum wage and /or introduce a maximum?

A Global Perspective

Should we protect our industries against cheap imports or should we embrace “free trade”? How have some developing countries “made poverty history” for millions of their citizens whilst in others the majority have less than “a dollar a day” to live on? The unit also covers an analysis of financial markets. Are speculators highly skilled or just lucky gamblers? To what extent have bail-outs in the banking industry increased the level of risk traders are willing to take? Who should take responsibility for the Financial Crisis of 2007/8? Will Covid kill globalisation?