Game study is the study of strategic interaction where one player’s decision depends on what the other player does. What the opponent does also depends upon what he thinks the first player will do. Examples of Game Theory Both players have a dominant strategy. A DOMINANT strategy occurs when...
C. P. Chandrasekhar and Jayati Ghosh March 28, 2019 The SDGs were obviously incredibly ambitious – far more so than the Millennium Development Goals that they succeeded – and so it was indeed a remarkable achievement that governments of almost all countries signed up to them. There...
Tejvan Pettinger Agriculture often appears to be one of the most difficult industries, frequently leading to some form of market failure. In the EU and US, agriculture is the most heavily subsidised industry, yet despite the cost of the subsidy it fails to address many issues...
Tejvan Pettinger Definition of Buffer Stock Scheme: A buffer stock scheme is a government plan to stabilise prices in volatile markets. This requires intervention buying and selling. Prices for agricultural products are often volatile because: Supply can vary due to the weather.Demand is inelasticSupply is fixed in the short...
Tejvan Pettinger The infant industry argument states that developing countries are justified to put tariffs on imports if they are seeking to develop new industries and diversify their economy. In particular, there is a justification for placing tariffs on industries where a country has a latent...
Tejvan Pettinger The tax burden refers to the share of GDP that is collected in different forms of tax within an economy. For example, in an economy with a size of £1,000bn – if the government collects tax of £300bn, then the tax burden will be 30%. The...
A budget deficit is the annual shortfall between government spending and tax revenue. The deficit is the annual amount the government need to borrow. The deficit is primarily funded by selling government bonds (gilts) to the private sector. Summary of effects of a budget deficit Rise in...
Tejvan Pettinger The Indian Rupee has fallen in value against a basket of currencies since independence in 1947. In recent years, the Indian Rupee has continued to depreciate in value. Indian Rupee value against US Dollar In 1990, you could buy $1 for 16 Indian Rupees. By 2013,...
Tejvan Pettinger A Customs Union occurs when a group of countries agree to have free trade amongst themselves and agree on a common external tariff to countries outside the zone. It is a step towards a single market, but a customs union doesn’t include freedom of...
Tejvan Pettinger Readers Comment. Why doesn’t the Bank of England just print the money instead of borrowing the money? Many often ask why government’s don’t print more money to deal with the problem of national debt. The reason is that printing more money doesn’t increase economic output in...