interest in economics essay

Economics Essay Examples

Ace Your Essay With Our Economics Essay Examples

Published on: Jun 6, 2023

Last updated on: Jan 31, 2024

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Are you struggling to understand economics essays and how to write your own?

It can be challenging to grasp the complexities of economic concepts without practical examples.

But don’t worry! 

We’ve got the solution you've been looking for. Explore quality examples that bridge the gap between theory and real-world applications. In addition, get insightful tips for writing economics essays.

So, if you're a student aiming for academic success, this blog is your go-to resource for mastering economics essays.

Let’s dive in and get started!

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What is an Economics Essay?

An economics essay is a written piece that explores economic theories, concepts, and their real-world applications. It involves analyzing economic issues, presenting arguments, and providing evidence to support ideas. 

The goal of an economics essay is to demonstrate an understanding of economic principles and the ability to critically evaluate economic topics.

Why Write an Economics Essay?

Writing an economics essay serves multiple purposes:

• Demonstrate Understanding: Showcasing your comprehension of economic concepts and their practical applications.
• Develop Critical Thinking: Cultivating analytical skills to evaluate economic issues from different perspectives.
• Apply Theory to Real-World Contexts: Bridging the gap between economic theory and real-life scenarios.
• Enhance Research and Analysis Skills: Improving abilities to gather and interpret economic data.
• Prepare for Academic and Professional Pursuits: Building a foundation for success in future economics-related endeavors.

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If you’re wondering, ‘how do I write an economics essay?’, consulting an example essay might be a good option for you. Here are some economics essay examples:

Short Essay About Economics

A Level Economics Essay Examples

Here is an essay on economics a level structure:

Band 6 Economics Essay Examples

Here are some downloadable economics essays:

Economics essay pdf

Economics essay introduction

Economics Extended Essay Examples

In an economics extended essay, students have the opportunity to delve into a specific economic topic of interest. They are required to conduct an in-depth analysis of this topic and compile a lengthy essay. 

Here are some potential economics extended essay question examples:

• How does foreign direct investment impact economic growth in developing countries?
• What are the factors influencing consumer behavior and their effects on market demand for sustainable products?
• To what extent does government intervention in the form of minimum wage policies affect employment levels and income inequality?
• What are the economic consequences of implementing a carbon tax to combat climate change?
• How does globalization influence income distribution and the wage gap in developed economies?

IB Economics Extended Essay Examples 

IB Economics Extended Essay Examples

Economics Extended Essay Topic Examples

Extended Essay Research Question Examples Economics

Tips for Writing an Economics Essay

Writing an economics essay requires specific expertise and skills. So, it's important to have some tips up your sleeve to make sure your essay is of high quality:

• Start with a Clear Thesis Statement: It defines your essay's focus and argument. This statement should be concise, to the point, and present the crux of your essay.
• Conduct Research and Gather Data: Collect facts and figures from reliable sources such as academic journals, government reports, and reputable news outlets. Use this data to support your arguments and analysis and compile a literature review.
• Use Economic Theories and Models: These help you to support your arguments and provide a framework for your analysis. Make sure to clearly explain these theories and models so that the reader can follow your reasoning.
• Analyze the Micro and Macro Aspects: Consider all angles of the topic. This means examining how the issue affects individuals, businesses, and the economy as a whole.
• Use Real-World Examples: Practical examples and case studies help to illustrate your points. This can make your arguments more relatable and understandable.
• Consider the Policy Implications: Take into account the impacts of your analysis. What are the potential solutions to the problem you're examining? How might different policies affect the outcomes you're discussing?
• Use Graphs and Charts: These help to illustrate your data and analysis. These visual aids can help make your arguments more compelling and easier to understand.
• Proofread and Edit: Make sure to proofread your essay carefully for grammar and spelling errors. In economics, precision and accuracy are essential, so errors can undermine the credibility of your analysis.

These tips can help make your essay writing journey a breeze. Tailor them to your topic to make sure you end with a well-researched and accurate economics essay.

To wrap it up , writing an economics essay requires a combination of solid research, analytical thinking, and effective communication. 

You can craft a compelling piece of work by taking our examples as a guide and following the tips.

However, if you are still questioning "how do I write an economics essay?", it's time to get professional help from the best essay writing service -  CollegeEssay.org.

Our economics essay writing service is always ready to help students like you. Our experienced economics essay writers are dedicated to delivering high-quality, custom-written essays that are 100% plagiarism free.

Also try out our AI essay writer and get your quality economics essay now!

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Barbara is a highly educated and qualified author with a Ph.D. in public health from an Ivy League university. She has spent a significant amount of time working in the medical field, conducting a thorough study on a variety of health issues. Her work has been published in several major publications.

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Why I Chose to Study Economics: A Student Shares Her Story

Just before my senior year of high school, I decided on a whim that I wanted to take the AP Economics course that my high school offered. Going into it, I had next to no knowledge about any economic topic.

At the time, my older sister, who was in college, had taken an economics course and told me that she found it interesting. This was definitely a contributing factor to my decision, since my older sister and I have always shared a lot of common interests.

Kaitlyn Hoevelmann took an economics class in high school and never looked back. Now, she enjoys putting her double major in economics and journalism to work at the St. Louis Fed. Learn about our diverse career and internship opportunities.

I felt drawn to the subject, and I was lucky that my school had the resources to offer the class.

Economics immediately became my favorite subject after that. I looked forward to class every day and joined Future Business Leaders of America (FBLA) to compete in the economics category. First, I had to take a test for the district level, and the people with the top scores would be sent to the state competition.

I had to take the test only a few months into the semester—we spent all of that time studying macroeconomics, and the test covered both macroeconomics and microeconomics, so I spent hours outside of school reading books and taking practice tests to try and learn as much as I could in a condensed amount of time.

I attribute the beginning of my persistent interest in economics to these moments spent learning on my own late at night or between homework assignments. I ended up placing in the district competition and qualifying for state, where I took another test and placed in the top 10.

I decided sometime during the school year that I wanted to major in economics in college. When I was admitted into the University of Missouri’s (Mizzou) journalism school, I decided to double major in economics and journalism. Since then, I have had a great deal of fun taking different economics courses in school, and I have had many brilliant economics professors to look up to and learn from.

I also have enjoyed my position as a peer learning assistant for an introductory economics course at Mizzou designed for journalism students. In this position, I have held office hours for students to come to me for help, graded assignments and hosted review sessions.

I find the subject complex and challenging, and it is my personal mission to understand as much as I can and constantly learn more. It feels like each question and topic I face is a puzzle that needs to be solved, and I enjoy putting the pieces together.

Another experience that led me to study economics—and to the St. Louis Fed in particular—is when I went there on a field trip with my AP Economics class. We visited the Economy Museum and heard from an economist.

Based on the beautiful lobby, the friendly atmosphere and the great work that is done here, I knew the first step in my career would be getting accepted into the summer internship program at the Fed . I reached this goal in 2019, the summer after my sophomore year at Mizzou.

I’d like to someday dedicate my career to making economics more understandable and accessible to people, since it’s incredibly important in everyday life to understand the economy and the way it works.

More to Explore

Editor’s note: Kaitlyn has written about a range of economics topics. Check out her work:

• What’s a Countercyclical Capital Buffer?
• The Economic Costs of the Opioid Epidemic
• How Payday Loans Work

Plus, listen to our Women in Economics podcast to hear real stories about prominent professionals making their marks in the field of economics.

Kaitlyn Hoevelmann was a Public Affairs writer at the St. Louis Fed.

Related Topics

This blog explains everyday economics, consumer topics and the Fed. It also spotlights the people and programs that make the St. Louis Fed central to America’s economy. Views expressed are not necessarily those of the St. Louis Fed or Federal Reserve System.

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What is an economics personal statement?

An economics personal statement should describe your motivations for wanting to study this subject. It tells the university who you are and why you will make a great economics candidate. Whether you're applying for an undergraduate or postgraduate course, it's crucial you present yourself in the best possible light to convince admissions tutors you will be a valuable asset to their department.

Your economics personal statement will be used by universities to decide whether you are a good student to study economics, and whether they want to offer you a place on their course.

How do I write an economics personal statement?

We recommend you start your economics personal statement by jotting down some ideas about your skills, experience, hobbies/extracurricular activities, strengths and ambitions for the future. Our personal statement template can help you structure your thoughts into coherent and concise paragraphs.

Start early and give yourself plenty of time to re-draft your economics statement, and proofread it for spelling and grammar. You will need to go through at least three or four revisions before you have a final, polished draft.

Once you're happy with it, make sure you check it for spelling and grammar (don't just rely on Spellchecker for this). Get someone else to read through it if you're worried you might miss something. You can then think about pasting it into your UCAS form, ready to send off.

What should I include in my economics personal statement?

• Be specific and try to give examples of your problem-solving and analytical skills, both of which are important in an economics degree.
• If you’re applying for a joint honours, e.g. economics and maths , then tailor your statement so you relate it to both of these subjects.
• A business management and economics personal statement might mention a role of responsibility, such as leader of your student debating society or head boy/girl at your sixth form. Or for an economics and finance personal statement , you could mention managing money at your Saturday job.
• Any hobbies or other activities you are involved in outside of school should always be linked to your economics course. If you don't feel something is relevant, then don't mention it - remember you only have a limited space of 4,000 characters, so every word has to earn its place. Our personal statement length checker can help you with this.
• Round off by talking about your career plans and any other ambitions you have for the future. Mention how your economics degree is going to help you achieve this.

How do I write the introduction for my economics personal statement?

Your introduction should pick out one or two aspects of economics that you particularly enjoy or are passionate about. For example, you might talk about your interest in current affairs and world development, and include one or two situations that made you want to study economics in more detail. This could be anything from a fiscal decision made by the Bank of England, or a how a civil war in another country has affected their levels of income.

By starting with an anecdote, or a specific situation you've read about or experienced, you will have a better chance of drawing the reader in, and making them want to finish reading your personal statement.

Whatever you choose to open with, it should be reflective and persuade the admissions tutors that this is the only subject you want to go on to study at university.

Economics personal statement introduction example

To help demonstrate what you should include in your opening paragraph, take a look at this great example below, where the writer uses their experience of growing up in a poor country where wealth was unevenly distributed as a catalyst for developing their interest in economics:

"Being born and brought up in a country where an uneven distribution of income is a norm, the poor live on a minimum wage of Rupees 115 a day, whilst the billionaires form the sixth largest group in the world. This vast contrast between the rich and the poor has always intrigued me and I have often questioned how this economy India, functions with such instability and chaos."

Here is another good example from another student, who talks about how their studies of the Great Depression ignited their appreciation for economics:

"Studying the Great Depression in the USA in 1929 for my extended project is when I started to fully appreciate my interest in economics. Being able to analyse and argue the issues within my extended project and relate it to the current economic crisis has awakened my passion for the subject further, especially as this subject is covered extensively in the news and media. This shows that economics is an essential factor of our society. Studying this subject in university will equip me with the knowledge to understand the economy thoroughly. "

Hopefully these examples will inspire you to write your own introduction for your economics statement that will grab the reader's attention and make the admissions tutors want to offer you a place on their course.

How do I write a conclusion for my economics personal statement?

Your conclusion should encompass where you hope your economics degree to take you, and what you hope to achieve in the future. This might include your career ambitions, or moving on to a postgraduate course to further enhance your education.

You may also wish to reiterate why are enthusiastic about applying for an economics degree, and why you think you will be a good student for this particular course.

Don't round off your statement with something vague, or by repeating something you've already mentioned elsewhere in your UCAS application. You only have 47 lines of space in which to sell yourself to the admissions tutors, so don't waste it!

Economics personal statement conclusion example

To help you write your concluding paragrapgh, take a look at this example below, where the writer talks about using the knowledge they will gain in real life situations, and how they enjoy learning about the effects of economics on a daily basis:

"I am very passionate about studying economics because I look forward to developing my current knowledge, and applying it to real life situations. I believe my desire to keep in touch with today’s economics is what will allow me to thrive in higher education."

This writer chooses to talk about applying for a Masters program once they complete their degree, and taking up internships during their summer break to gain more work experience:

"My aspirations upon graduation from University would be to advance my studies in a similarly themed Masters program or work in international development. I plan on taking internships throughout the summer breaks to gain more work experience and help me fund my student lifestyle. I am looking forward to learning and developing in various economic subjects and am excited about the opportunities that I’ll have both as a student and once I graduate."

Hopefully these two examples will help you write your own conclusion for your economics personal statement, and round it off in a way that will make it stand out from the crowd.

For more help and advice on what to write in your economics personal statement, please see:

• Personal Statement Editing Services
• Personal Statement Tips From A Teacher
• Analysis Of A Personal Statement
• The 15th January UCAS Deadline: 4 Ways To Avoid Missing It
• Personal Statement FAQs
• Personal Statement Timeline
• 10 Top Personal Statement Writing Tips
• What To Do If You Miss The 15th January UCAS Deadline.

What can I do with an economics degree?

There are many different options for those choosing to pursue an economics degree. These include:

• business analyst
• financial consultant
• investment analyst .

However, there are also many other career paths where an economics degree could be useful, such as:

• data scientist
• economic development officer
• quantity surveyor .

For more advice on what you can do with your economics degree, please visit TopUniversities and Prospects .

What are the best UK universities for economics?

Currently, the best UK universities to study economics at for 2023 are:

For more information on UK university rankings for economics, please see The Complete University Guide and The Telegraph.

Further resources

For more information and advice on economics degrees and careers, please see the following:

• 9 Economics Degree Jobs
• Careers in Economics - LSE
• 10 Jobs for Graduates With An Economics Degree
• What jobs can you get with an Economics degree in the UK?
• Economics - Career Pilot
• What to do with an Economics degree - Bright Network

Related resources

Economics statement analysis.

Find out more

UCAS Economics Subject Guide

Careers In Economics

National Careers Service: Economist

Economics Courses

Economics Degree Jobs

Economics University Rankings 2023

Economics Degree Guide

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How to Write a Good Economics Essay

Last Updated: March 7, 2023 References

This article was co-authored by Emily Listmann, MA . Emily Listmann is a private tutor in San Carlos, California. She has worked as a Social Studies Teacher, Curriculum Coordinator, and an SAT Prep Teacher. She received her MA in Education from the Stanford Graduate School of Education in 2014. This article has been viewed 127,323 times.

A good economics essay requires a clear argument that is well-supported by appropriately referenced evidence. Research your topic thoroughly and then carefully plan out your essay. A good structure is essential, as is sticking closely to the main essay question. Be sure to proofread your essay and try to write in formal and precise prose.

Preparing to Write Your Essay

• For example a question such as “Discuss the macroeconomic consequences of rising house prices, alongside falling interest rates” could be divided into 2 parts: 1 part could be on the effects of rising prices, and 1 on the effects of falling interest rates.
• In this example you could begin by discussing each separately and then bringing the 2 together and analysing how they influence each other.
• Be sure to keep the question at the forefront of your mind and don’t veer off topic. [1] X Research source

• Be sure that you understand all the key terms that you are being asked about.
• Try to keep your reading focussed closely to the essay question.
• Don’t forget to look at any lecture or class notes you have made.
• 3 Come up with a thesis statement . A thesis statement is the main argument you will make in your essay. It should be 1-2 sentences long and respond to the essential question that’s being asked. The thesis will help you structure the body of your essay, and each point you make should relate back to the thesis.

• Once you have put together a list of key points, then try to add in some more detail that brings in elements from your research.
• When you come to write out your essay, you can develop a paragraph based on each point.

• All of the evidence and explanation will be in the main body of the essay.
• Order the key points in the body of your essay in such a way that they flow logically.
• If you are writing a longer essay, you can break the main body into different sections. [2] X Research source
• If you have a word limit, be sure to take this into account when you are planning.
• Allocate yourself a rough number of words per section.
• The introduction and conclusion can be just a paragraph each.

Writing the Essay

• What your essay is about.
• What material you will cover in the essay.
• What your argument is. [3] X Research source

• Having this stated clearly at the start can help you to stay focussed on the question as you work your way through the essay.
• Try writing out this one or two sentence statement and sticking it up in front of you as you write, so it’s stays at the forefront of your mind.

• Try to begin each paragraph with a sentence that outlines what the paragraph will cover.
• Look at the opening sentence of each paragraph and ask yourself if it is addressing the essay question. [5] X Research source

• Try to engage with arguments that run counter to yours, and use the evidence you have found to show the flaws.
• It might help to imagine someone reading the essay, and anticipating the objections that he might raise.
• Showing that you have thought about potential problems, and you can make an argument that overcomes them, is a hallmark of an excellent essay. [6] X Research source
• If there is conflicting evidence, discuss it openly and try to show where the weight of the evidence lies. [7] X Research source
• Don’t just ignore the evidence that runs counter to your argument.

• In the conclusion you can add a few sentences that show how your essay could be developed and taken further.
• Here you can assert why the question is important and make some tentative suggestions for further analysis.

Proofreading and Making Revisions

• As you read through it, think about how closely you stick to main overarching question.
• If you notice paragraphs that drift off into other areas, you need to be tough and cut them out.
• You have a limited number of words so it’s essential to make every one count by keeping tightly focussed on the main question.

• Think about how you use the evidence too. Do you critically engage with it, or do you merely quote it to support your point?
• A good analytical essay such discuss evidence critically at all times.
• Even if the evidence supports your argument, you need to show that you have thought about the value of this particular piece of data.
• Try to avoid making any assumptions, or writing as if something were beyond dispute. [10] X Research source

• Remember an academic essay should be written in a formal style, so avoid colloquialisms.
• Avoid contractions, such as “don’t”, or “won’t”.
• Try to avoid paragraphs that are more than ten or fifteen lines long.
• Think about how it looks on the page. [12] X Research source

• Always include a bibliography, but don’t include references to things you haven’t read or didn’t inform your argument. [13] X Research source
• Your teacher will know if you just add a load of titles into your bibliography that are not evidenced in the body of your essay.
• Always follow the bibliography format used by your department or class.

Community Q&A

You Might Also Like

• ↑ http://www.economicshelp.org/help/tips-economic-essays/
• ↑ http://www.writing.utoronto.ca/advice/planning-and-organizing/organizing
• ↑ http://carleton.ca/economics/courses/writing-preliminaries/academic-essay-writing/
• ↑ https://www.economicsnetwork.ac.uk/archive/lse_writing/page_11.htm
• ↑ http://homes.chass.utoronto.ca/~mcmillan/writing.pdf
• ↑ https://www.royalholloway.ac.uk/economics/documents/pdf/essaywriting-departmentofeconomics.pdf

About This Article

Before you begin writing your economics essay, make sure to carefully read the prompt so that you have a clear sense of the paper's purpose and scope. Once you have read the prompt, conduct research using your textbook and relevant articles. If you cannot find research materials, ask your instructor for recommendations. After your research is done, construct a 1-2 sentence thesis statement and begin outlining your main ideas so that your essay will have a clear structure. Make sure to leave time to write a draft and revise your work before it is due. If you want to learn more, like how to cite the sources you used for your essay, keep reading the article! Did this summary help you? Yes No

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How to Write a Good Economics Essay

Governor November 28, 2019 Real World Applications 3 Comments

Many students ask “How to write an economics essay?” This Guide to Writing a Good Economics Essay is applicable to both IB economics as well as the Singapore JC A-Level H2 economics examinations. Many of the pointers here are also applicable to large-mark case study questions.

6 Steps to Writing a Good Economics Essay

Step 1: dissect the question.

Make sure you analyse and fully understand the KEYWORDS and REQUIREMENTS of the question. This is a very important skill that is taught in our economics tuition classes .

For example, “Best”, “Most Effective” are closely related but mean different things.

Paraphrase the question to make it simpler if necessary.

Take note of the command word (eg: Explain, Discuss) as it determines the approach needed for the essay, for example, whether two sides are needed or one side is sufficient. Below are some common examples found in economics essay questions:

Command Words                                      Action Required

Account for                                                 Explain why

Analyse                                                        Break it down into step-by-step explanations

Assess                                                          For & Against. Consider other factors.

Compare                                                      Identify Similarities & Differences

Distinguish                                                   Point out differences

Discuss                                                        Explore both sides

Evaluate                                                       The Good and The Bad.

Explain                                                          Show why and how

Explain whether                                            Cover both possibilities

Examine                                                        Look closely. How so and how not so?

To What Extent                                              Yes…..But….Judgment

Remember to look out for the context in the question. This is usually given in the form of a country (eg: Singapore). The examples in your essay must be tailored to this particular context (for example, do not suggest interest rate policy for Singapore as that is considered infeasible in the Singapore context). If no context is given, any real-world example can be used.

Keep in mind the question throughout the essay and remember to always answer the question. Don’t go off-point!

Common Examiner’s Comment :  Not Answering Question (NAQ))

Step 2: Plan Your Answer

Take some time to consider what economic framework you will use to approach the question. Scribble down your main thesis and anti-thesis points. Ensure they ANSWER THE QUESTION.

Step 3: Essay Introduction

In the introduction, include definitions of keywords in the question and spell out the economic framework you will employ for your answer as well as key definitions.

Step 4: Body of Essay

In the body , there will be several paragraphs. 

The number of points/paragraphs depends on the question. It is common to require 2 main points for each 10 mark essay and similarly for 15 mark essay questions. Under each main point, there may be 1-2 sub-points.

Use one paragraph for each sub-point you are making.

However, do not be too focussed on the number of points or paragraphs. The key is to answer the question.

For each body paragraph , use TET’s PEEL(ED) structure. Include only one main idea per paragraph.

• Point – Write your point in the first sentence so that markers will know what the paragraph will be about. The topic sentence must directly answer the question!
• Explanation – Explain what you mean
• Elaboration – Provide further analysis with clear step-by-step economic reasoning. This part may be done with examples as well as diagrams.
• Link – Link your explanations back to the Point and to answer the question.
• Exemplification – Give an example to support your reasoning. It can be statistics or real-world examples (for Case Studies, evidences from the Case must be uncovered!)
• Diagram – Where possible, araw an appropriate diagram with correct labelling and refer to it in your answer. This is crucial to show economic reasoning. Diagrams are very important for economics essays!

These are of course much easier said than done! Thus, students in our economics tuition classes are regularly honed to achieve such output including with tips and tricks to spark off the correct thinking process.

Our resources including the Study Guides for A Level and IB economics also provide a very powerful and handy reference on the depth of analysis required to score the highest marks.

Common Examiner’s Comment :  Mere statements and claims. No economic rigour.

Step 5: In-Body Evaluation

This applies especially to the 15 mark essays for A-Level Economics. A total of 5 marks is catered for Evaluation. Students should attempt to achieve about 2-3 in-body evaluation marks by pointing out how the thesis and anti-thesis points may not be true due to certain assumptions made that may not hold. Students may write “However,….may not necessarily happen……It would depend on whether….”. This statement can be written after the associated sub-point has been made.

Step 6: CONCLUDING SECTION

This only applies to the 15 mark essay questions.

Earn more evaluation marks by making a reasoned judgement. Deliver your verdict like a Judge! 

Check back on the question before you embark on this. Ensure your judgement answers the question.

So the question now is, how does a judge arrive at and deliver a verdict? Certainly, you should not be summarising or merely paraphrasing your main points in the conclusion. Obviously, you cannot expect more marks by saying the same thing over and over again!

After a verdict and reasons have been provided, consider providing further relevant insights and/or recommendations.

Common Examiner’s Comment :  Repetitive. Mere Summary.

Here are some quite common types of Concluding Sections 

• Consider the relative importance of thesis and anti-thesis factors. Which factors are most important or pertinent in the given context? For example, certain policies better fit specifc types of economies.
• Consider short-term vs long-term pros and cons. Do the short-term benefits outweigh the long-term costs? Is the policy more effective in the long-term, and if so, how pressing is the problem that needs to be addressed?
• Suggest a multi-policy approach, in which each policy has strengths and weaknesses that allow them to complement each other.

There is no way to really memorise evaluation points as every question and context is different. After all, you are being tested on higher-order thinking!

There are other evaluation tips that our students will receive but the key point here is that the training of the mind to think and apply economics is essential. That is where our weekly economics lessons come into play and that is why our students are often asked questions in class and trained to think on their feet. As ex-student Xue Min from YIJC testified, Chief Tutor Mr. Kelvin Hong does not just spoon-feeds our students but mentors them in their thinking to arrive at the answers. This was different from other tutors that her classmates experienced and eventually this was the key to Xue Min’s A grade.

In your essay, write in simple and clear sentences. Everything you write should be value-adding. You do not have to spend time showing off vocabulary as no extra points are awarded for language. Focus on economic reasoning. Use succinct and effective examples which support the point you are trying to make as well as accurate diagrammatic analyses.

For samples of great economics essays, please check out our free Economics Model Essays and sample Past JC A-Level Economics Questions and Answers .

For our econs publications that are sold worldwide, please check out our A Level & IB Economics Study Guides and Model Essays Publications

About The Economics Tutor

Founded by Kelvin Hong in 1998, The Economics Tutor is one of the leading economics tuition in Singapore. We provide a comprehensive program to guide students in understanding complex economic concepts and applying them through case study analyses, essay writing and discussion of real world events.

For 24 years, the way we teach JC Economics Tuition (A Level Economics Tuition) and IB Economics Tuition classes helped learners appreciate economics and everything it entails on a much larger scale. We take things step-by-step, implement effective techniques in memorising frameworks and give every student the chance to nurture their ideas. 

We don’t just solely focus on helping you get stellar grades and perfect scores. We make sure that we also hone the critical thinking skills and investment / business decisions you can use outside the four walls of your classroom.

Looking for a fun, engaging and probably the best economics tutor in Singapore? Look no further—check out our extensive and high quality economics resources on the website such as our IB and A Level Economics Publication. Click here to order .

Book your lesson today and master the nuances of economics in our next class!

its good knowledgeable post regarding ib economics commentaries. i just wanted to admin can i use your blog as reference to my students .

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Deconstructing the Ideal Economics Essay: Beyond Supply and Demand

Short Description What is Economics Essay: Differentiating It from Other Types Choosing Essay Topics for Economics Economics Essay Example How to Write an Economics Essay: Structure and Components Good Extended Essay Topics for Economics To Sum Up

Did you know that the famous economist John Maynard Keynes not only shaped economic policy but also had a knack for writing compelling essays that changed the course of history? One of his most influential works, 'The Economic Consequences of the Peace,' published in 1919, critiqued the Treaty of Versailles that ended World War I. In this gripping essay, Keynes argued that the terms of the treaty were not only punitive but would also lead to economic and political turmoil in Europe. His foresight and eloquence were so compelling that they influenced political leaders and played a pivotal role in the renegotiation of the treaty's terms. Keynes' piece demonstrated the profound impact that a well-crafted essay on economics can have on the world, transcending academia and affecting real-world decisions.

Short Description

In our comprehensive article, our expert online paper writer will delve into the fascinating world of economics essays. Discover what it is and explore its diverse forms, from insightful research papers to engaging extended essays. Learn the art of selecting the perfect essay topics for economics, master the essential structure and format, and gain valuable insights on writing with precision. We'll even provide you with a selection of intriguing extended essay topic suggestions to spark your academic curiosity. Whether you're a student, researcher, or simply keen to delve into the economic realm, this article is your all-in-one guide to crafting exceptional essays.

Secure your essay now, and let's turn numbers into your greatest allies. Don't miss the chance to be the 'econ' of the party – order today!

What is Economics Essay: Differentiating It from Other Types

So, what is economics essay? At its core, it is a specialized form of academic writing that delves into economic concepts, theories, and issues. What sets it apart from other types of writing, for example, an article review example , is its focus on the economic aspects of various subjects, its emphasis on data analysis, and its application of economic principles to real-world scenarios. Let's explore some key differentiators:

• Economic Perspective: This kind of writing approaches topics from an economic perspective, considering factors like given price and consumer's desire. It analyzes economic phenomena, such as market behaviors, price changes, production, and consumption, to provide a deeper understanding of the subject matter and its impact on total demand.
• Data-driven: These essays often rely on data and statistics to support arguments and conclusions. Whether you're discussing the impact of inflation on a nation's economy or the correlation between education and income, data plays a central role in validating your points.
• Application of Economic Theories: They frequently apply economic theories and models to explain and predict economic behaviors. Understanding theories like supply and demand, elasticity, or market structures is crucial in constructing a compelling argument.
• Interdisciplinary Nature: They can intersect with various disciplines. For instance, you might write an economics essay on the environmental impact of government policies, which blends economic concepts with environmental science and policy analysis.
• Policy Implications: Many economics essays explore the policy implications of economic findings. They discuss how specific economic phenomena might influence government decisions or corporate strategies.
• Real-World Relevance: Unlike purely theoretical essays, economics papers are rooted in real-world issues. They seek to address current economic challenges, such as unemployment, inflation, trade deficits, and more, making them highly relevant to contemporary society.

Choosing Essay Topics for Economics

Selecting the right economics essay topics is a pivotal first step in crafting an exceptional paper. Your chosen topic will determine the direction of your research, the depth of your analysis, and the engagement of your readers. Here are some key considerations to keep in mind when choosing an economics essay topic:

• Personal Interest: Begin by reflecting on your own interests within the field of economics. Are there specific economic theories, policy issues, or aspects of microeconomics or macroeconomics that particularly captivate you? Writing about a topic you're genuinely curious about can make the research and writing process more enjoyable and fulfilling.
• Relevance: Consider the current relevance of your chosen topic. Economics is a dynamic field, with new issues emerging regularly. Focusing on a current economic problem or trend can make your essay more compelling and valuable.
• Scope: Evaluate the scope of your topic. Ensure it's neither too broad nor too narrow. Topics that are too broad can lead to superficial analysis, while overly narrow topics may limit the availability of relevant data and sources.
• Available Data: Ensure that sufficient data and research materials are available for your chosen topic. The availability of data can significantly impact the depth of your analysis and the strength of your arguments.
• Uniqueness: Consider whether your topic offers a unique perspective or addresses an aspect of economics that is often overlooked. A fresh and innovative approach can make your essay stand out.
• Audience: Think about your target audience. Is your essay intended for your economics professor, fellow students, or a broader audience? Tailor your topic selection to the interests and knowledge level of your readers.
• Interdisciplinary Opportunities: Don't hesitate to explore interdisciplinary topics that combine economics with other fields like sociology, politics, or environmental science. Such topics often provide a richer context for analysis.

Economics Essay Example

In the realm of economics, mastering intricate theories and principles can often prove challenging. That's why our expert admission essay writing service has crafted a practical economics essay example to shed light on complex concepts and provide a clear roadmap for understanding the subject.

Title: The Impact of Minimum Wage on Income Inequality

Introduction

Income inequality has become a pressing concern in modern economies. As the wealth gap widens, policymakers and economists are increasingly focusing on potential solutions to address this issue. One such solution is the adjustment of minimum wage rates. This essay delves into the complex relationship between minimum wage policies and income inequality, exploring the various mechanisms through which minimum wage can either exacerbate or mitigate income disparities. By analyzing empirical evidence and economic theories, we aim to provide a comprehensive view of the effects of minimum wage on income inequality.

Minimum Wage and Low-Income Workers

Minimum wage policies have a direct impact on low-income workers. When the minimum wage is increased, these workers experience a boost in their earnings. This, in theory, should reduce income inequality, as those with the lowest incomes see an increase in their wages. For example, studies by Smith and Johnson (2020) found that a $1 increase in the minimum wage led to a significant rise in the income of low-wage workers, contributing to a reduction in income inequality.

Effects on Employment and Income Inequality

However, the relationship between minimum wage and income inequality is more intricate. Critics argue that raising the minimum wage can lead to job losses, particularly in industries with tight profit margins. This raises concerns about unemployment among low-skilled workers. For instance, the Congressional Budget Office (CBO) projected that a $15 minimum wage, if implemented, could lead to the loss of 1.3 million jobs by 2024.

Regional Disparities

Another aspect to consider is regional disparities in the cost of living. A uniform minimum wage may not account for variations in living costs across different regions. In high-cost metropolitan areas, the minimum wage may still fall short of providing a livable income, contributing to income inequality.

Income Substitution

Some argue that the impact of minimum wage on income inequality is offset by a phenomenon known as 'income substitution.' When the minimum wage is increased, employers may reduce non-wage benefits, such as health insurance or retirement contributions, to offset increased labor costs. As a result, the total compensation package for low-wage workers may not improve substantially, and income inequality may persist.

Counter Arguments

It's essential to acknowledge counter arguments as well. Proponents of minimum wage increases argue that they not only benefit low-wage workers but also stimulate economic activity. When low-income individuals earn more, they tend to spend more, boosting demand and potentially leading to job creation. Furthermore, minimum wage policies can improve overall labor productivity by incentivizing workers to stay in their jobs longer, thus enhancing their skills and value in the labor market.

In conclusion, the relationship between minimum wage policies and income inequality is multifaceted. While increasing the minimum wage can directly benefit low-income workers and potentially reduce income inequality, it is crucial to consider the broader implications. The impact on employment, regional disparities, and the potential for income substitution should all be taken into account when evaluating the effectiveness of minimum wage policies in addressing income inequality. Economists and policymakers must carefully balance the desire to uplift low-wage workers with the need to maintain a competitive labor market and promote economic growth.

• Smith, A., & Johnson, B. (2020). The Impact of Minimum Wage on Income Inequality. Journal of Economic Research, 45(3), 311-328.
• Congressional Budget Office (CBO). (2021). The Effects of a Minimum-Wage Increase on Employment and Family Income. https://www.cbo.gov/publication/56193

How to Write an Economics Essay: Structure and Components

Understanding how to write an economics essay, much like learning how to use modifiers , requires a clear structure and attention to key components. This section will guide you through the fundamental elements of an economics essay and provide valuable tips and examples to help you craft a compelling piece.

Introduction :

• Begin with a captivating hook or a relevant quote to grab the reader's attention.
• Provide background information about the topic and its significance in the field of economics.
• State your thesis statement, which is the main argument or point you will address in the essay.
• Example : 'In today's globalized economy, the impact of international trade agreements on national economies has become a subject of extensive debate. This essay explores the multifaceted effects of trade agreements on economic growth, job creation, and income distribution, shedding light on the complexities of global trade dynamics.'
• The body of your essay should be organized into several paragraphs, each addressing a specific aspect of your topic.
• Start each paragraph with a clear topic sentence that outlines the main point or argument.
• Provide evidence and data to support your arguments. Use real-world examples, economic theories, and empirical studies to strengthen your claims.
• Ensure a logical flow between paragraphs to maintain the coherence of your essay.
• Example : In a paragraph discussing the impact of trade agreements on job creation, you might write, 'For instance, the North American Free Trade Agreement (NAFTA) is often cited as a case study. According to a study conducted by Smith and Jones in 2018, NAFTA resulted in the creation of an estimated 5.9 million jobs in the United States over a span of two decades.'

Counter Arguments:

• Address counterarguments and opposing viewpoints in your essay to demonstrate a comprehensive understanding of the topic.
• Refute counter arguments with evidence or provide a nuanced perspective, highlighting the complexity of the issue.
• Example : ' While proponents of trade agreements argue that they stimulate economic growth, critics contend that they can lead to job displacement in certain industries. However, it's important to note that the job displacement effect varies across industries and is often offset by the creation of new jobs in export-oriented sectors.'

Conclusion:

• Summarize the main points made in the essay and restate your thesis.
• Provide insights or implications of your findings and their significance.
• Avoid introducing new information in the conclusion.
• Example : 'In conclusion, trade agreements have far-reaching economic implications, affecting not only economic growth but also job markets and income distribution. A nuanced understanding of these effects is crucial for policymakers and economists in shaping future trade policies.'

Useful Tips for Writing an Economics Essay

• Clarity and Conciseness : Economics essays should be clear and concise. Avoid jargon and complex language that might confuse your readers.
• Citation and Referencing : Properly cite and reference all sources you use in your essay. Follow a recognized citation style (e.g., APA, MLA, Chicago).
• Use Real Data : Whenever possible, use real data and statistics to support your arguments. This lends credibility to your essay.
• Edit and Proofread : Carefully edit and proofread your essay for grammar, spelling, and coherence. A well-written, error-free essay is more persuasive.
• Stay Focused : Stick to your thesis and avoid going off on tangents. Every paragraph should contribute to your main argument.

Good Extended Essay Topics for Economics

Choosing good extended essay topics for economics in 2023 can be an exciting opportunity to delve deep into a subject that interests you. Here are some intriguing ones from our nursing paper writing service :

• The Impact of Digital Currencies on Traditional Banking: Analyze the rise of cryptocurrencies and their potential to disrupt traditional banking systems, considering factors affecting demand and market equilibrium.
• Economic Consequences of Climate Change Policies: Investigate the economic effects of government policies aimed at combating climate change, including carbon taxes and emissions trading schemes, and their impact on market demand and equilibrium price.
• The Gig Economy: Explore the economic implications of the gig economy, including its impact on traditional employment, income inequality, and labor regulations, and its influence on quantity demanded and supply curve dynamics.
• The Economics of Healthcare Access: Analyze the factors affecting healthcare access and affordability, with a focus on healthcare systems in different countries, and how these factors relate to particular price points and market price.
• Income Inequality and Economic Growth: Investigate the relationship between income inequality and a nation's economic growth, examining how inequality affects productivity and overall economic well-being, potentially leading to shifts in aggregate demand.
• The Economics of Renewable Energy Adoption: Study the economic factors driving the adoption of renewable energy sources and their impact on energy markets and sustainability, affecting supply curve dynamics and market equilibrium.
• Trade and Economic Growth: Analyze the relationship between international trade and a country's economic growth, considering trade agreements, tariffs, and export-oriented policies and their influence on demand curve shifts.
• The Economics of Education: Investigate the economic effects of education, such as its impact on earning potential, social mobility, and national economies, potentially influencing market demand for educational services.
• Economic Impact of the Aging Population: Explore how the aging population affects economic systems, including issues related to healthcare, pensions, and workforce dynamics, leading to changes in market equilibrium.
• The Economics of Big Tech Companies: Analyze the economic influence and implications of large technology corporations on markets, competition, and innovation, possibly affecting aggregate demand and market price for tech-related products and services.

In conclusion, this article has explored the multifaceted world of economics papers, from selecting compelling topics to mastering the structure and components of a well-crafted essay. We've also provided valuable insights into the intricate relationship between minimum wage and income inequality. Remember that an essay on economics requires meticulous research, clear analysis, and the ability to navigate intricate economic theories. With these tools in your arsenal, you're well-prepared to tackle the fascinating and ever-evolving field of economics.

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The power of economics to explain and shape the world

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Nobel Prize-winning economist Esther Duflo sympathizes with students who have no interest in her field. She was such a student herself — until an undergraduate research post gave her the chance to learn first-hand that economists address many of the major issues facing human and planetary well-being. “Most people have a wrong view of what economics is. They just see economists on television discussing what’s going to happen to the stock market,” says Duflo, the Abdul Latif Jameel Professor of Poverty Alleviation and Development Economics. “But what people do in the field is very broad. Economists grapple with the real world and with the complexity that goes with it.”

That’s why this year Duflo has teamed up with Professor Abhijit Banerjee to offer 14.009 (Economics and Society’s Greatest Problems), a first-year discovery subject — a class type designed to give undergraduates a low-pressure, high-impact way to explore a field. In this case, they are exploring the range of issues that economists engage with every day: the economic dimensions of climate change, international trade, racism, justice, education, poverty, health care, social preferences, and economic growth are just a few of the topics the class covers. “We think it’s pretty important that the first exposure to economics is via issues,” Duflo says. “If you first get exposed to economics via models, these models necessarily have to be very simplified, and then students get the idea that economics is a simplistic view of the world that can’t explain much.” Arguably, Duflo and Banerjee have been disproving that view throughout their careers. In 2003, the pair founded MIT’s Abdul Latif Jameel Poverty Action Lab, a leading antipoverty research network that provides scientific evidence on what methods actually work to alleviate poverty — which enables governments and nongovernmental organizations to implement truly effective programs and social policies. And, in 2019 they won the Nobel Prize in economics (together with Michael Kremer of the University of Chicago) for their innovative work applying laboratory-style randomized, controlled trials to research a wide range of topics implicated in global poverty. “Super cool”

First-year Jean Billa, one of the students in 14.009, says, “Economics isn’t just about how money flows, but about how people react to certain events. That was an interesting discovery for me.”

It’s also precisely the lesson Banerjee and Duflo hoped students would take away from 14.009, a class that centers on weekly in-person discussions of the professors’ recorded lectures — many of which align with chapters in Banerjee and Duflo’s book “Good Economics for Hard Times” (Public Affairs, 2019). Classes typically start with a poll in which the roughly 100 enrolled students can register their views on that week’s topic. Then, students get to discuss the issue, says senior Dina Atia, teaching assistant for the class. Noting that she finds it “super cool” that Nobelists are teaching MIT’s first-year students, Atia points out that both Duflo and Banerjee have also made themselves available to chat with students after class. “They’re definitely extending themselves,” she says. “We want the students to get excited about economics so they want to know more,” says Banerjee, the Ford Foundation International Professor of Economics, “because this is a field that can help us address some of the biggest problems society faces.”   Using natural experiments to test theories

Early in the term, for example, the topic was migration. In the lecture, Duflo points out that migration policies are often impacted by the fear that unskilled migrants will overwhelm a region, taking jobs from residents and demanding social services. Yet, migrant flows in normal years represent just 3 percent of the world population. “There is no flood. There is no vast movement of migrants,” she says. Duflo then explains that economists were able to learn a lot about migration thanks to a “natural experiment,” the Mariel boat lift. This 1980 event brought roughly 125,000 unskilled Cubans to Florida over a matter a months, enabling economists to study the impacts of a sudden wave of migration. Duflo says a look at real wages before and after the migration showed no significant impacts. “It was interesting to see that most theories about immigrants were not justified,” Billa says. “That was a real-life situation, and the results showed that even a massive wave of immigration didn’t change work in the city [Miami].”

Question assumptions, find the facts in data Since this is a broad survey course, there is always more to unpack. The goal, faculty say, is simply to help students understand the power of economics to explain and shape the world. “We are going so fast from topic to topic, I don’t expect them to retain all the information,” Duflo says. Instead, students are expected to gain an appreciation for a way of thinking. “Economics is about questioning everything — questioning assumptions you don’t even know are assumptions and being sophisticated about looking at data to uncover the facts.” To add impact, Duflo says she and Banerjee tie lessons to current events and dive more deeply into a few economic studies. One class, for example, focused on the unequal burden the Covid-19 pandemic has placed on different demographic groups and referenced research by Harvard University professor Marcella Alsan, who won a MacArthur Fellowship this fall for her work studying the impact of racism on health disparities.

Duflo also revealed that at the beginning of the pandemic, she suspected that mistrust of the health-care system could prevent Black Americans from taking certain measures to protect themselves from the virus. What she discovered when she researched the topic, however, was that political considerations outweighed racial influences as a predictor of behavior. “The lesson for you is, it’s good to question your assumptions,” she told the class. “Students should ideally understand, by the end of class, why it’s important to ask questions and what they can teach us about the effectiveness of policy and economic theory,” Banerjee says. “We want people to discover the range of economics and to understand how economists look at problems.”

Story by MIT SHASS Communications Editorial and design director: Emily Hiestand Senior writer: Kathryn O'Neill

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Tips and advice for evaluation in essays

Evaluation is an important component of an advanced essay. It requires the ability to look at facts, arguments and analysis, with a degree of critical distance. Evaluation involves:

• Looking at what other factors may affect the outcome.
• Time lags involved.
• How it might depend on other issues, e.g. elasticity of demand
• Why the original statement may be incorrect.
• How significant is a factor?

Which questions need evaluation?

Questions which require evaluation usually have these words a the start:

• To what extent

Examples of Evaluation

1. How reliable is the data?

For any essay, you will be using a variety of sources. For example, an essay on trades unions may include information from the TUC. It is good to give data from a source like TUC. However, a valid evaluation technique is to question the reliability and independence of your source.

For example, it is quite likely that the TUC will choose statistics that are more advantageous to workers. Business organisations, e.g. CBI on the other hand, are likely to give alternative sets of data which is more favourable to their point of view.

Therefore, examine the likelihood of bias in data and resources for the essay.

2. Short run and long run?

The effects of a decision can be quite different in the long run. For example, suppose you had an essay, which examined the impact of an increase in tax on petrol. The obvious answer is to say: “very little, demand for petrol is inelastic”

However, it would be evaluative to say; “However, over time demand may become more elastic. After a couple of years people may find alternative ways of driving.

3. It depends on other factors

When looking at the effect of one outcome, it is worth bearing in mind it is often difficult to isolate other factors. For example, if we were looking at the impact of a rise in interest rates. The effect would usually reduce consumer spending. However, there are many other factors that can affect consumer spending. If confidence was high, for example, consumer spending may not fall at all – despite the increase in interest rates.

4. Look at both points of view

In subjects like economics, history and politics there are usually several different viewpoints. It is important to give them all consideration, even if we don’t necessarily agree with them. For example, if we look at the impact of a rise in government spending, a Keynesian might say this will increase growth; a Monetarist, on the other hand, may argue higher spending merely causes crowding out. Therefore, there are two different possibilities.

5. State of economy

The impact of a devaluation in the currency depends on the state of the economy. If the economy is experiencing inflation and is in a boom, a devaluation could worsen the inflation. However, in a recession, a devaluation can help boost exports and there is likely to be limited impact on inflation.

The effect of a fall in AD depends on state of economy

6. How significant is a factor?

A recession in France would lead to lower UK exports to France. France is an important trading partner, however on its own French exports are only a relatively small % of UK AD.   If the rest of the Eurozone was growing, and it was just France in recession, it is unlikely to have much impact on the UK economy. However, if the whole global economy was in recession, this would be much more significant and likely cause a recession in the UK too.

7. Different perspectives

As we mentioned in, UK economic growth in the past four years. How you interpret data is important.

If you showed a graph of UK economy growth since 2013 Q1 – it would give quite a favourable impression of economy.

Including figures from 2011 Q1 gives less favourable.

If we look at this graph, it shows the UK economy still has a large negative output gap.

The important thing is that statistics may only tell part of the story. Just because an economy like Spain grew in the last quarter – doesn’t necessarily mean their economy is doing very well.

More on macroeconomic evaluation – discuss the impact of a cut in interest rates

Example question

Discuss impact of the MPC cutting interest rates from 5% to 4.5%?

Lower interest rates make it cheaper to borrow and therefore encourage consumer spending. Cheaper borrowing also encourages firms to invest. With an increase in C + I, we see a rise in Aggregate Demand and therefore we can expect higher economic growth and higher inflation.

Examples of Evaluation of this question

• In theory, lower interest rates will increase spending. However, commercial banks may not pass the base rate cut onto consumers. This happened during the credit crisis because there was a shortage of cash. Therefore, banks were reluctant to lend – they needed to improve their balance sheets.  Therefore, even though the MPC  cut base rates in 2008-09, consumers may not notice lower interest rates  and therefore, there was little if any increase in consumer spending. This explains why the interest rate cut of 2009, failed to cause a strong economic recovery.
• Lower interest rates may not increase economic growth because other aspects of the economy are doing badly. For example, falling house prices are causing a decline in consumer wealth and confidence. Therefore, despite lower interest rates, falls in house prices are offsetting the potential boost to spending from lower rates. Also, in 2009-11, we experienced a global recession. The recession in the Eurozone caused lower exports and therefore the cut in rates could be insufficient given the fact other aspects of AD are being reduced.
• The cut is only very small. 0.25% is probably insufficient to have much effect especially given problems already mentioned. However, you could argue the UK is sensitive to interest rates because of the number of variable mortgages. Even a 0.25% cut in rates can increase disposable income for people with large mortgages. (this is what you might call double evaluation, evaluation of the evaluation)
• The cut will take time. A cut in interest rates will not boost spending immediately. For example, It will not affect people on a fixed-rate mortgage for about 2 years. Therefore, after a cut in interest rate, we may not see the boost to spending for up to 18 months; this makes monetary policy much more difficult.

Further resources for Economic Essays

• Exam tips for economics
• Model economics essays

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• Microeconomic evaluation
• Tips for writing economic essays

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Why I Want You to Study Economics: Increasing Diversity, Inclusion, and Opportunity in Economics

I thank the organizers of this year's LEED program and Professor Fidelis Ikem, the dean of the College of Business, for inviting me to speak today. I am proud of the relationship that the Federal Reserve Bank of Cleveland is building with Central State University. It's great to be on campus today, where one feels a real sense of history. At the Federal Reserve, we are proud of the fact that while the first two attempts at central banks in the U.S. lasted only 20 years each, the Fed is in its 105th year. But Central State is even older. Founded in 1887, the university recently celebrated its 131st birthday. Central State's designation as a historically black college and its focus on providing a high-quality academic experience to all students are things to be proud of. They make this university a very good place for me to speak about the benefits of an education in economics and the importance of diversity in the field of economics. Before I continue, I should remind everyone that the views I'll present today are my own and not necessarily those of the Federal Reserve System or my colleagues on the Federal Open Market Committee.

Why Study Economics

I didn't start out to be an economist. I majored in mathematics at Barnard College but also pursued a second major in economics because it seemed interesting and didn't require much additional course work. I applied to graduate school in math but ended up in the economics Ph.D. program at Princeton because two professors there wrote me letters explaining that Princeton's economics program was very mathematical and encouraging me to come there and study economics. I've always thought that I lucked into economics. It has provided me with a fascinating career, and I hope that at least in a small way I've been able to provide some good in return through economic research and policymaking.

Merriam-Webster defines economics as "a social science concerned chiefly with description and analysis of the production, distribution, and consumption of goods and services." Well, that's fine as far as it goes, but it sounds kind of dry. Others think of economics as a path to running a business or working in finance. That's also fine as far as it goes, but it is too limited a view. Instead, I like to think of economics as a social science that helps us think about how people use scarce resources, interact in markets or in other economic settings, respond to incentives, and make trade-offs. The fact that economics is a social science, one that involves people and their choices, makes economics complicated but also very interesting.

Because economics provides a rigorous way of thinking about trade-offs, incentives, and costs and benefits, it has many real-world applications. It can help a company be more profitable but it can also help policymakers formulate better public policies that affect people's lives. It can help us analyze the distribution of income across individuals, regions, and countries, and the causes for those differences. It can help us understand how a small financial shock might be propagated economy-wide or even globally, and what can be done to prevent such contagion. It can help us understand the issues facing people in or entering the workforce and provide evidence on which programs are most effective at helping them finance their education, develop new skills, and manage the changing job landscape driven by technological innovation. Economics can help us understand how people make financial decisions and how simple changes can result in better outcomes. For example, a simple change from making employees have to opt out of a company's savings plan, rather than opt in, can result in higher participation in the plan. 1 One well-formulated study of a Fortune 500 company's 401(k) savings plan found that switching to automatic enrollment increased employee participation from 49 percent to 86 percent. It also found that employees' savings decisions tend to be inert, so the default contribution rate and fund allocation are important features to consider in designing such a plan.

A default rule like this is an example of what behavioral economists call a nudge—something that isn't mandated but points people in the right direction and can change behavior. 2 Richard Thaler, an economics professor at the University of Chicago, won a Nobel Prize last year for his foundational work in behavioral economics, which combines aspects of psychology with economics. In his Nobel Prize lunch lecture, he mentioned that good work is being done around the world to, and I quote: "design and test scientifically informed policies that are working. People are being helped to save more for retirement, more poor kids—especially girls—are going to school, peasant farmers are retrieving more reliable harvests, and we are all being successfully nudged to use less energy." 3 That passage lists just a few of the areas in which economics is having a real-world impact and doing some good. In the policy realm, economics helps guide decisions about the country's monetary and fiscal policies, but also policies on health care, education, and trade. It helps in the design and evaluation of programs at the local community level too, including workforce development and transportation policy. In a nutshell, I believe that economics helps society.

I hope this piques your interest in studying economics. But if you need more convincing, you might want to know that economics offers a very good return on your education dollar. The ability to think critically, analyze a problem systematically, and deal with ambiguity are all skills developed through the study of economics and they are all skills highly valued in the job market. One recent study found that those with a bachelor's degree in economics earn about 20 percent more than graduates with degrees in other fields. 4 Some of the salary differences reflect the fact that economics majors have access to a wide variety of occupations, many of which are higher-paying. You'll find people with economics degrees employed in many sectors, including education, accounting, law, business, finance, and government. The Federal Reserve System—the 12 Reserve Banks and the Board of Governors—employs about 700 Ph.D. economists and also many others with undergraduate and master's degrees in economics, and I can tell you from experience that the Fed is a very productive and fascinating place to work.

The State of Diversity in Economics

The good news is that economics is a popular major in U.S. colleges and universities. In 2016, U.S. postsecondary schools awarded about 33,500 bachelor's degrees in economics. 5 While this represents less than 2 percent of all bachelor's degrees awarded by these schools, at the top 100 universities and top 100 liberal arts colleges without an undergraduate business major, about 10 to 20 percent of male undergraduates major in economics. 6 That's a high number when you consider how many different majors there are. But despite its popularity, the field has had less success in attracting women or historically under-represented racial and ethnic minorities. 7 While there has been some improvement compared to the 1970s, this under-representation has been going on for many years.

Using U.S. Department of Education data on four-year, non-profit colleges and universities over 2011-2015, Bayer and Wilcox found that while women earned more than half of all bachelor's degrees awarded across all fields, they earned less than a third of the bachelor's degrees in economics. 8 And the numbers are lower for under-represented minorities, who earned slightly more than 20 percent of bachelor's degrees and about 11 percent of economics degrees awarded. If you think about this in terms of the share of female graduates who choose to major in economics and the share of male graduates who choose to major in economics, according to Bayer and Wilcox's numbers, there is one female economics major for every 100 female bachelor's degrees compared to about three male economics majors for every 100 male bachelor's degrees. That means women are choosing to major in economics at only a third of the rate of men. 9 Similarly, minorities are choosing economics over other majors at only about half the rate of white students.

While you don't need to have majored in economics to enter a Ph.D. program in economics, it is a natural path. So given the under-representation of women and minorities at the undergraduate level, it is probably not surprising they are also under-represented at the Ph.D. level and in academia. The good news is that representation of women among the ranks of academia, from first-year graduate student through full professor, is higher now than in 1970. 10 The bad news is that progress has slowed. In 2017, females made up 32 percent of first-year grad students in economics compared to 30 percent in 1997. Almost a third of the new doctorates in 2017 were awarded to women, but gender diversity falls as one moves up the academic ranks. Women make up less than 30 percent of assistant professors, about 23 percent of tenured associates, and about 14 percent of full professors in economics. Unless there is a pickup in entry into graduate school, it is hard to see how these numbers can increase.

Analysis of minority representation in graduate economics is complicated a bit by the fact that almost 60 percent of doctorates awarded in economics are awarded to nonpermanent resident students. Some of these graduates return to their own countries, while others stay in the U.S. Restricting attention to U.S. citizens and permanent residents, of the 479 economics doctorates awarded in 2016, only 48, that is, 10 percent, were awarded to under-represented minorities: 15 were earned by African Americans and 33 by Hispanics or Latinos. 11 In the academic professorial ranks, under-represented minorities make up less than 10 percent of assistant professors and less than 5 percent of full professors.

There has been some progress: the percentages of undergraduate and graduate degrees awarded to minorities have increased over the past two decades. But the rate of change has been slower than the growth of the minority population in the U.S. and slower than the growth of minority representation across all fields and in the STEM fields of science, technology, engineering, and math. Indeed, minorities earn a greater share of the degrees awarded in the STEM fields than they do in economics. 12 Similarly, the representation of women in the STEM fields is also now higher than it is in economics. 13

Why Isn't Economics Diverse and Why Does It Matter?

An interesting question is why women and minorities are under-represented in economics. One potential explanation is the lack of role models in the field. Seeing someone of the same race or gender being successful in a field can be validating, and having someone like you to run ideas by or get advice from can be very helpful. So, the relative lack of women and minorities in economics could be perpetuating under-representation. This is a plausible explanation but it may be only one piece of the puzzle, as the empirical evidence on role models is somewhat mixed. 14 One study of a selective liberal arts college that essentially involved random assignment of students to instructors found that having an instructor of the same gender didn't increase the probability of a student taking more classes or majoring in the field, regardless of the gender distribution in the department, but it was associated with the student earning a higher grade in fields dominated by the opposite gender. 15 That is, female students received higher average grades from female instructors when taking courses in fields dominated by men (such as economics)—the difference was on the order of moving from a B-minus to a B. And there was a similar effect for males, who received higher average grades from male instructors when taking courses in female-dominated fields (such as education). A separate study in a different setting found evidence that such grade differentials reflected achievement differentials and not just inflated grading. 16 So the availability of role models appears to positively affect student achievement, but a lack of role models isn't the whole story about why some students choose not to continue in economics.

What about different preferences at the time students enroll? It is true that males are more likely than females to list economics as their planned major when accepted at college. But this gender difference for incoming students is not the full story because research that looks at the progression of students through the major has found that female students are relatively more likely to drop out of the major and switch to another field compared to male students. For example, one study found that women need to do well in their principles of economics course in order to continue in the major, and that's less true of men. 17

Other hypotheses have to do with the way economics is taught or with the content of the courses. Do large lecture classes, often found in introductory economics programs at large universities, turn off women and minorities more than men? Do the topics incorporated into the intro courses appeal to one group and not another? And, if so, how could the content be amended so that all students, regardless of race, ethnicity, or gender, feel included and take up the opportunity to be an economics major? Could it be that implicit biases come to play at each stage of the academic ladder, as has been shown in other types of settings?

As a college math major, I am happy to say that the theory that women may be more turned off by the heavy mathematical content in economics does not pan out. In fact, women earn over 40 percent of bachelor's degrees in math and statistics, a higher share than in economics; 18 women do well in math at the high school level; women are selecting other fields that are very quantitative, like psychology; and studies indicate that math aptitude doesn't explain gender differences in participation in upper-level economics courses. 19

So there are several different theories being explored, and I suspect that, at the end of the day, there are multiple drivers of the under-representation of women and minorities in the field of economics. But you might ask: why should we care? Shouldn't students be able to choose their field of study and career path? The low level of diversity in economics may just reflect people's preferences. That's a possibility, but if that's the case, then it is incumbent upon those of us in the field and upon educators to ensure that students can make informed choices and that they understand the value of an economics degree to the individual and to society.

Moreover, because economics is a field that influences policy, and policy affects all kinds of people, it's important to have diverse views inform that policy. As a public servant and Fed policymaker, I believe that policymakers need to consider the effects of our monetary, regulatory, and payments policies on all our constituents. In addition, I have seen firsthand how having a diversity of views expressed and discussed around the table can actually lead to better policy decisions, and there is actual research to back this up. Group dynamics are different when teams are diverse. Participants don't necessarily find it as comfortable to serve on a diverse team, but the diversity helps to avoid group-think. Diverse teams tend to be more objective and focus on the facts when making decisions; they may process information more carefully because they are forced to confront a different way of thinking and convince those with alternative views; and firms with more diversity tend to be more innovative. 20 Research also shows that firms with diverse management tend to have above-average earnings 21 Perhaps the better decision-making and innovation associated with diversity is showing up on the bottom line.

Beyond current policy and business outcomes, another reason I'd like to see more diversity in the field of economics is so the field itself doesn't get stymied by group-think. To expand our knowledge, economics needs to continually take on new research questions and develop innovative techniques and ways of analysis to arrive at answers to these questions. Broader representation in economics means a broader set of issues will be tackled and a broader set of research disseminated, resulting in better policy outcomes that will improve the economic well being of a greater share of the population.

Some Things Are Being Done

The American Economic Association, through its Committees on the Status of Women and the Status of Minority Groups in the Economics Profession, is taking a close look at diversity in the economics profession and is offering programs and resources aimed at increasing diversity at all levels. The association provides information to students who want to pursue careers or a graduate degree in economics, and also provides lesson plans to teachers. It offers a summer training and scholarship program to help prepare students for graduate school and, with the National Science Foundation, offers a Summer Economics Fellows Program, which is designed to increase the participation and advancement of women and under-represented minorities in economics.

I serve on the board of the Council for Economic Education. This nonprofit organization's mission is to educate students in kindergarten through high school about economics and personal finance so they can make better decisions for themselves, their families, and their communities. The council provides many materials to teachers and also runs the National Economics Challenge, a quiz bowl competition, which reaches a wide population of students in terms of gender, race, and income. Last year, over 11,000 high school students participated in the challenge; of these, 42 percent were girls and 22 percent were under-represented minorities, and participation from these groups has been increasing over time. A recent survey found that participants' performance on advanced placement exams exceeds the national average, with especially strong gains shown by female and minority students, and that participants are more likely than nonparticipants to choose to major in economics.

At the Cleveland Fed, we strive for excellence in all that we do. And that means we are taking actions to foster a culture that champions diversity, inclusion, and opportunity throughout the organization. To increase our ability to recruit high-quality talent in a variety of positions, including banking, computer programming, data science, accounting, as well as economics, we are developing relationships with schools in our District, including Central State. Last June, we hosted a number of Central State students and several faculty members as part of your school's eight-week summer Banking Institute program, and we will host another group of CSU students again next month. You may have attended one of the guest lectures that some of our economists have given in your economics and business classes, and representatives are here today to tell you about paid internships and other employment opportunities at the Cleveland Fed. As a contribution to strengthening the pipeline of future economists, the Cleveland Fed will be hosting a workshop this summer for the research assistants across the Federal Reserve System to help them prepare for graduate school. The Cleveland Fed has also been promoting pre- and post-college education. Our Learning Center distributes lesson plans on economics and financial literacy to teachers in kindergarten through high school, and our Money Museum, which is open to the public, offers interactive exhibits on the financial system and the economy. These may be small steps, but economics can help solve many real-world problems while providing individuals with a rewarding career, and we want to ensure that the widest group of people enter the field.

Fifty years ago today, this country lost a great leader, Dr. Martin Luther King, Jr. The tragedy of his death must not overshadow his many accomplishments and the lessons conveyed by his words and deeds. As I've discussed, there has been some progress over the past 50 years in increasing diversity, inclusiveness, and opportunity within the economics profession, but that progress has been slow. It is easy to get discouraged and accept the status quo. But we all must remember a key lesson from Dr. King's legacy: changing institutions is hard work and takes time. It must be met by perseverance and endurance. As a member of the economics profession, I will continue to seek ways to increase diversity, inclusion, and opportunity because I believe it will strengthen economic research and policymaking, and thereby help promote a healthier economy for a wider group of people. I encourage the students of Central State University to enter the field of economics and to join me in that mission.

• See Chetty, et al. (2017). Return to 1
• For accessible descriptions and examples of nudging, see Committee for the Prize in Economic Sciences in Memory of Alfred Nobel (2017), Thaler (2017a), and Sunstein (2017). Return to 2
• Thaler (2017b). Return to 3
• Carroll, et al. (2014). Return to 4
• The data on the number and proportion of bachelor's degrees in economics in U.S. postgraduate institutions are derived from Tables 325.92 and 322.10 from U.S. Department of Education, National Center for Education Statistics, Integrated Postsecondary Education Data System (IPEDS). Return to 5
• Goldin (2013, 2015). Return to 6
• The U.S. Department of Education's Integrated Postsecondary Education Data System (IPEDS) classifies as historically under-represented minorities members of the following groups: Hispanic or Latino (non-Hispanic), (non-Hispanic) Black or African American, and American Indian or Native Alaskan. The IPEDS data are used by the American Economic Association's Committee on the Status of Minority Groups in the Economics Profession (CSMGEP) to assess minority representation in the field. Return to 7
• Bayer and Wilcox (2017). Return to 8
• Among schools in the top 100 that offer both business and economics degrees, regardless of gender, students prefer the business degree over economics, but women do so to a greater extent. See Goldin (2013, 2015). Return to 9
• The statistics cited in this paragraph are the preliminary statistics for 2017 compiled by the American Economic Association's Committee on the Status of Women in the Economics Profession. See Lundberg (2017). Return to 10
• These statistics are from the U.S. Department of Education IPEDS data as reported in Committee on the Status of Minority Groups in the Economics Profession (CSMGEP) (2017). Return to 11
• Committee on the Status of Minority Groups in the Economics Profession (CSMGEP) (2017). Return to 12
• Goldin (2013, 2015). Return to 13
• Goldin (2013) and Griffith (2013). Return to 14
• Griffith (2014). Return to 15
• Carrell, et al. (2010). Return to 16
• Goldin (2013, 2015) and Avilova and Goldin (2018). Return to 17
• Table 325.65, U.S. Department of Education, National Center for Education Statistics, Integrated Postsecondary Education Data System (IPEDS). Return to 18
• See Goldin (2013), and Bayer and Rouse (2016). Return to 19
• See Rock and Grant (2016). Return to 20
• Rock and Grant (2016) cite a Credit Suisse analysis of 2,400 companies worldwide that found that organizations with at least one female board member had higher return on equity and higher net income growth than firms with no female board members. In addition, Hunt, et al. (2015) report on a McKinsey & Company analysis of 366 companies that found that those in the top quartile in terms of management's ethnic and racial diversity were 35 percent more likely to have financial returns above their industry mean, while those in the top quartile in terms of management's gender diversity were 15 percent more likely to have financial returns above their industry mean. Return to 21
• Avilova, Tatyana, and Claudia Goldin, "What Can UWE Do for Economics?" National Bureau of Economic Research Working Paper 24189, January 2018. ( https://www.nber.org/papers/w24189.pdf )
• Bayer, Amanda, and Cecilia Elena Rouse, "Diversity in the Economics Profession: A New Attack on an Old Problem," Journal of Economic Perspectives 30 (Fall 2016), pp. 221-242. ( https://doi.org/10.1257/jep.30.4.221 )
• Bayer, Amanda, and David Wilcox, "The Unequal Distribution of Economic Education: A Report on the Race, Ethnicity, and Gender of Economics Majors at US Colleges and Universities," Finance and Economics Discussion Series 2017-105, Divisions of Research & Statistics and Monetary Affairs, Federal Reserve Board, Washington, D.C. ( https://www.federalreserve.gov/econres/feds/files/2017105pap.pdf )
• Carrell, Scott E., Marianne E. Page, and James E. West, "Sex and Science: How Professor Gender Perpetuates the Gender Gap," Quarterly Journal of Economics 125 (2010), pp. 1101-1144. ( https://doi.org/10.1162/qjec.2010.125.3.1101 )
• Carroll, Thomas, Djeto Assane, and Jared Busker, "Why it Pays to Major in Economics," Journal of Economics Education 45 (2014), pp. 251-261. ( https://doi.org/10.1080/00220485.2014.917906 )
• Chetty, Raj, John Friedman, Søren Leth-Petersen, Torben Nielsen, and Tore Olsen, "Active vs. Passive Decision and Crowd-Out in Retirement Savings Accounts: Evidence from Denmark," Quarterly Journal of Economics 129 (2017), pp 1141-1219. ( https://doi.org/10.1093/qje/qju013 )
• Committee for the Prize in Economic Sciences in Memory of Alfred Nobel, "Scientific Background on the Sveriges Riksbank Prize in Economics in Memory of Alfred Nobel 2017, Richard H. Thaler: Integrating Economics with Psychology," October 9, 2017. ( https://www.nobelprize.org/uploads/2018/06/advanced-economicsciences2017-1.pdf )
• Committee on the Status of Minority Groups in the Economics Profession, Annual Report, American Economic Association, December 2017. ( https://www.aeaweb.org/content/file?id=6592 )
• Goldin, Claudia, "Notes on Women and the Economics Undergraduate Major," Newsletter of the Committee on the Status of Women in the Economics Profession (CSWEP) (Summer 2013), pp. 4-6, 15. ( https://www.aeaweb.org/content/file?id=570 )
• Goldin, Claudia, "Gender and the Undergraduate Economics Major: Notes on the Undergraduate Economics Major at a Highly Selective Liberal Arts College," manuscript, April 12, 2015 (update of Goldin, Summer 2013).
• Griffith, Amanda L., "The Importance of Role Models," Newsletter of the Committee on the Status of Women in the Economics Profession (CSWEP) (Summer 2013), pp. 9-10, 16. ( https://www.aeaweb.org/content/file?id=570 )
• Griffith, Amanda L., "Faculty Gender in the College Classroom: Does it Matter for Achievement and Major Choice?" Southern Economic Journal 81 (2014), pp. 211-231. ( https://doi.org/10.4284/0038-4038-2012.100 )
• Hunt, Vivian, Dennis Layton, and Sara Prince, "Why Diversity Matters," McKinsey & Company, January 2015. ( https://www.mckinsey.com/business-functions/organization/our-insights/why-diversity-matters )
• Lundberg, Shelly, "The 2017 Report of the Committee on the Status of Women in the Economics Profession," American Economic Association, December 6, 2017. ( https://www.aeaweb.org/content/file?id=6388 )
• Rock, David, and Heidi Grant, "Why Diverse Teams Are Smarter," Harvard Business Review , November 4, 2016. ( https://hbr.org/2016/11/why-diverse-teams-are-smarter )
• Sunstein, Cass R., "Nudging: A Very Short Guide," manuscript, September 22, 2017. ( http://www.tif.us.edu.pl/download/2015010893532Nudge_Sunstein.pdf )
• Thaler, Richard H., "From Cashews to Nudges: The Evolution of Behavioral Economics," Nobel Prize Lecture slides, December 8, 2017a. ( https://www.nobelprize.org/uploads/2018/06/thaler-lecture-slides.pdf )
• Thaler, Richard H., "Speech at the Nobel Banquet," December 10, 2017b. ( https://www.nobelprize.org/nobel_prizes/economic-sciences/laureates/2017/thaler-speech.html )
• U.S. Department of Education, National Center for Education Statistics, Integrated Postsecondary Education Data System (IPEDS), Digest of Education Statistics : 2016. ( https://nces.ed.gov/programs/digest/d16/index.asp )

Suggested Citation

Mester, Loretta J. 2018. “Why I Want You to Study Economics: Increasing Diversity, Inclusion, and Opportunity in Economics.” Speech, Leaders, Executives, Entrepreneurs and Directors (LEED) Program - Central State University College of Business - Wilberforce OH.

Example 25-Mark Essay in style of AQA Economics A-level

Below is an example model answer to a 25 mark question in the style of AQA Economics A-level.

For extra practice questions or exam technique advice, check out the following posts:

Question for model answer

Consider the following question. This is a question I have written in the style of a 25-mark AQA Economics A-level question for section B:

Taking effect from 1st April 2023, the UK Government has committed to increasing the corporation tax rate from 19% to 25% for companies with profits above £250,000 per year. For firms with profits below £50,000, there is no increase in corporation tax rates. But for firms with profits between £50,000 and £250,000 there will be a smaller increase in corporation tax rates.

(Source: here )

Evaluate the effects on the UK economy of increasing corporation tax rates on firms making high profits (25 marks) .

This is a key macroeconomics essay on current affairs. A quick essay plan is here:

• Define key terms.
• Laffer curve – higher government revenue.
• Evaluation – position on Laffer curve.
• AD effect – lower investment and negative multiplier effect.
• Evaluation – proportion of AD that comes from investment.
• LRAS effect – reduced incentives and productivity.
• Evaluation – need to compare corporation tax rates to those of other economies.

Conclusion.

Possible model answer

Corporation tax is a tax on firms’ profits. Aggregate demand (AD) is the total demand in the economy, AD = C+I+G+X-M. 

Increasing corporation tax rates may increase tax revenue for the UK Government. The Laffer curve shows this. An increase in tax rates from T to T1 raises tax revenue from R to R1. This revenue could go towards reducing the budget deficit. The government’s budget deficit is very high at 14.9% of the UK’s GDP in 2020-21. This is because of government spending in the pandemic on for example the furlough scheme. Reducing the budget deficit may lead to government borrowing and hence reduced debt interest payments. With less spending on debt interest the UK Government could choose to spend more money in the future on other priorities such as healthcare spending. Sounder public finances might also make investors more confident in the UK Government’s ability to make bond repayments. This may reduce the interest rates at which investors are willing to buy government bonds and thus reduce future borrowing costs.

Whether the tax increase raises government revenue depends on the position of the UK economy on the Laffer curve. If instead the economy is at point (T1,R1) before raising corporation taxes, then increasing the corporation tax rate to T2 may decrease revenue to R. This is because a corporation tax rise may reduce incentives to start or grow a business, reducing the size of the tax base. The UK Government does predict that tax revenue would rise by over £10bn a year because of the corporation tax rate rise. With corporate tax rates relatively low now, it is likely that there will be higher revenue. But the effect of higher taxes on incentives may reduce the extent to which revenue increases.

Increasing corporation tax rates “from 19% to 25% for companies with profits above £250,000 per year”  reduces the post-tax profits of these firms. This leaves reduced funds for investment, so investment may fall. Also as firms know any future profits will be taxed at a higher rate, this will disincentivise investment further. This is because firms will have reduced returns (lower post-tax profits) from any new investment. So investment falls and as investment is a component of aggregate demand (AD=C+I+G+X-M), aggregate demand shifts left from AD to AD1. This may cause a negative multiplier effect. This is where a fall in investment leads to a larger than proportionate fall in A. Lower investment results in lower incomes for firms and cuts in wages, so consumers cut their spending, meaning consumption also falls and so on. So AD shifts further left to AD2. This results in lower real GDP as real GDP falls from Y to Y2. Hence corporation tax may lower real GDP, likely resulting in lower living standards.

However this argument depends on the proportion of AD influenced by the corporation tax rate rise. Only firms making larger profits are facing a corporation tax rise. So firms making lower profits, for example small businesses, are less likely to reduce their investment. Also consumption is the largest component of AD, making up roughly 60% of AD, not investment. So a given percentage fall in investment may have only a smaller effect on AD. Corporation tax is likely to reduce AD leading to lower real GDP. But these impacts are limited by the relative importance of investment to AD and the design of the policy to target high profit firms only.

Decreased investment can also influence the supply side of the economy. Lower investment could mean reduced firm spending on capital goods and human capital. So this could reduce productivity and hence the productive capacity of the economy. This means the LRAS could shift to the left. Higher corporation taxes could mean higher business costs, shifting the short-run aggregate supply curve left too. Lower productivity and higher business costs could lead to a higher price level in the UK economy, reducing the competitiveness of the UK as a place to do business. Productivity for the UK economy is 15% below the average of other G7 economies (as of 2015), so corporate tax rises could further worsen this UK productivity gap with other nations. So there may be fewer businesses choosing to set up in the UK, preferring to set up abroad.

However this depends on the level of corporation tax rates in other economies. The UK has the lowest corporate tax rate among the G7 economies, even after the tax rise. Hence there may be fewer incentives to set up a business abroad, so the effect on competitiveness is reduced. Also many economies have agreed to a global minimum corporation tax of 15%, further reducing the risk to competitiveness from raising corporation taxes. While the corporation tax rate rise may reduce investment, it is less likely to have a significant impact on competitiveness.

Overall raising corporation tax on firms making high profits is likely to be effective in raising revenue. While raising corporation tax will reduce aggregate demand and aggregate supply, by raising taxes only on higher-profit firms, the impact is limited. The impact of the tax rise does depend on how other countries respond – if other countries maintain or reduce their tax rates to attract more businesses, then increasing corporate taxes could significantly reduce the incentive for international businesses to set up in the UK. However, given the increasing degree of tax cooperation globally, as shown by the 15% minimum corporate tax rate agreement, it seems likely that countries will not seek to undercut each other’s corporate tax rates.

Application is throughout using examples from the short extract and from own knowledge to support analysis and evaluation.

Analysis is detailed, using chains of reasoning and graphs to support the answer.

Evaluation is also detailed, making use of chains of reasoning and where relevant, data about the economy. The conclusion addresses the question and justifies the answer.

Note for the conclusion you could have picked another side for this policy too depending on the arguments used. You could also use other possible points – there is no right way of doing this. For example with interest rates at historical lows, how does that impact the cost of government borrowing and the necessity of raising taxes? What other factors may matter for investment beside corporate tax rates?

This essay would likely score level 5 according to AQA Economics A-level criteria.

For more guidance on AQA exam technique (25 markers, 15 markers, 9 markers and more), check out the blue button below:

Other Questions

How many words should there be in a 25 marker economics.

Most 25 mark responses, that can be replicated within exam conditions, are within the range of 700 to 1100 words.

However this is arbitrary – word count does not matter as much, provided you answer the question and write in depth.

Achieving depth in analysis and evaluation, answering the question – see my economics resources here for more information on essay structures and how to evaluate.

How should you structure a 25 marker economics essay?

Introduction

Depending on depth of your previous points, add another round of analysis and evaluation.

For more information on AQA Economics essay structure, I recommend the following article linked here .

How should you write a conclusion for 25 markers economics?

A conclusion has these key elements:

• Answer the question.
• Justify your answer in step 1.
• Consider other evaluation points, including real-world context, for further justification or that may go against your answer.

How should you evaluate in economics 25 markers?

I recommend the “depends on” structure for AQA Economics style evaluation. For more information on this, see my AQA Economics style evaluation guide here .

More Resources

Here is a link to an online course for AQA Economics A level exam technique:

For practice questions on microeconomics, please see the button here:

If you are interested in more A-level Economics resources, please feel free to click the button below:

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Essay on interest | economics.

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In this essay we will discuss about Interest in Economics. After reading this essay you will learn about: 1. Meaning of Interest 2. Gross and Pure Interest 3. Variations in Interest Rates 4. The Time Preference Theory of Interest 5. The Classical Theory of Interest 6. The Neo-Classical or Loanable Funds Theory of Interest 7. Keynes’ Liquidity Preference Theory of Interest and Other details.

• Essay on the Modern Theory of Interest

Essay # 1. Meaning of Interest:

In common parlance, interest is a payment made by a borrower to the lender for the money borrowed and is expressed as a rate percent per year. In economics, interest has been defined in a variety of ways. Commonly, interest is regarded as the payment for the use or service of capital.

As Carver said, “Interest is the income which goes to the owner of capital.” According to Mil, “Interest is the remuneration for more abstinence.” Marshall substituted the word ‘waiting’ for abstinence and said that interest is the reward for waiting. The Austrians led by John Rae and Bohm Bawerk and followed by Fisher in America considered interest to be the ‘agio’ or the premium for time preference.

Keynes regarded interest as a purely monetary phenomenon, payment for the use of money. It is the reward for parting with the liquidity of money . The neo-classical economists, however, define it as the price for the use of loanable funds.

But the modern economists in their effort to avoid these divergent and controversial views about the nature of interest, have explained it in terms of productivity, saving, liquidity preference and money. In other words, interest is simultaneously the reward for the pure yield of capital, if saving, for the foregoing of liquidity and the supply of money. Thus they explain it in terms of the demand and supply of money.

Essay # 2. Gross and Pure Interest:

The payment which the borrower makes to the lender excluding the principal is gross interest.

It is a composite item which includes the following payments:

(1) Pure or Net Interest:

It is the payment for the use of capital or money only. This is interest in the pure economic sense. It is normally the same during a period of time even in different markets.

(2) Reward for Risk-Taking:

The lender exposes him to risk when he lends money. Gross interest includes the reward for risk-taking. The greater the risk element, the higher is the rate of gross interest. Unsecured loans are more risky than secured ones and they carry a high premium rate.

(3) Reward for Inconvenience:

When a lender loans money, he foregoes its use for the duration of the loan. His money is locked up and cannot be used for more profitable purposes. Or, if he needs this amount for his personal use, he will have to undergo the inconvenience of arranging it from some other source. In fixing the rate of interest, the lender includes in it the reward for such inconveniences.

(4) Reward for Management:

The lender has to incur expenditure in keeping proper accounts of the borrowers. He buys account books and even maintains staff. He has to remind borrowers and sometimes has to file a suit for the recovery of loans. The payment that the lender receives from the borrower also includes the expenses for management.

Pure or net interest is what remains with the lender after deducting the reward for risk-taking, management and inconvenience from gross interest.

Thus Gross Interest = Net interest + reward for risk taking + reward for inconvenience + reward for management.

Net Interest = Gross Interest – (reward for risk taking + reward for inconvenience + reward for management).

Essay # 3. Variations in Interest Rates:

Interest rates vary from person to person and from place to place. There are many factors which cause variations in interest rates which are explained below.

a. Differences in Gross Interest:

Variations in the rate of interest are due to differences in gross interest such as risk and inconvenience involved, cost of keeping records and collection of loans, etc. The greater the risk and inconvenience, and the cost of management of loans, the higher will be the rate of interest and vice versa.

b. Nature of Security:

Interest rate varies with the type of security. Loans against the security of gold carry less interest rate than loans against the security of immovable property like land or house. The more liquid are the assets, the lower is the interest rate and vice versa.

c. Credit Worthiness of the Borrower:

Interest rate also depends upon the credit of the borrower. Persons of known integrity and creditability can get loans on easy terms.

d. Period of Loan:

Rate of interest also depends upon the period of loan. Long-term loans carry higher rate of interest than short-term loans. In a long-term loan, the money gets locked up for a longer duration. Naturally, the lender wants to be compensated by a higher rate of interest.

e. Amount of Loan:

The rate of interest stands in an inverse relation to the amount of loan. The greater the amount of loan, the lower is the rate of interest and vice versa.

f. Differences due to Distance:

Distance between the lender and the borrower also causes differences between interest rates. People are willing to lend at a lower rate of interest nearer home than at a long distance.

g. Differences in Productivity:

Productivity of capital differs from venture to venture. People are willing to borrow at a higher rate of interest for productive ventures and vice versa.

8. Market Imperfections:

Differences in interest rates are also due to market imperfections that may be found in a loan market. Money lenders, indigenous banks, mutual funds, commercial banks, etc. follow different lending policies and charge various interest rates.

Essay # 4. The Time Preference Theory of Interest:

The Time Preference Theory is associated with Irving Fisher who defined interest as an “index of the community’s preference for a dollar of present over a dollar of future income.” Time preference is the preference that people have for present income over future income of an equal amount and equal certainty.

It is a tendency on the part of the people to vary the income meant for consumption from time to time by saving and borrowing. Interest is the price that is paid to the people for present income rather than for future income. It is determined by the willingness principle and the investment opportunity principle.

a. The impatience or willingness principle depends upon:

(i) The size of income;

(ii) The distribution of income;

(iii) The composition of income;

(iv) The certainty of enjoying income in future;

(v) Personal traits of individuals, such as foresight, self-restraint in consumption, etc.

If the income size is large, individuals will satisfy present wants more and discount the future at a lower rate. The distribution of income may take place in three different ways: first, income may be uniform throughout second, it may decrease in the future; and third, it may increase gradually in the future.

If the income is uniform throughout, the rate of impatience will be determined by the size of income and foresight. If income increases as a person advances in age, the present income will be less and the rate of impatience will be high, and vice versa. The behaviour or composition of income is also similar.

So far as the certainty of enjoying future income is concerned, if the future is uncertain, the rate of impatience will be high, and vice versa. When the rate of willingness is determined in this way, it tends to equal the rate of interest.

If it is higher than the market rate of interest, an individual will borrow and use this amount to satisfy his more pressing wants. On the contrary, if the rate of willingness is lower than the market rate of interest, he will lend his income and gain thereby.

He will continue to change his income by borrowing or lending, till his rate of willingness equals the market rate of interest. Fisher concluded; “Only time preference (or willingness) could account for interest, for where one was indifferent as to the present and future, interest could not arise.”

b. The second determinant of the rate of interest is the rate of marginal return over cost or the investment opportunity principle. The rate of return over cost depends upon the extent to which an income stream might be shifted by changes in capital utilisation.

If an individual has two investment opportunities before him in the form of two income streams that can be substituted for each other, ‘cost’ implies the loss of withdrawing one income stream, and ‘return’ is the gain from substituting one income stream for another.

The rate of return over cost is that discount rate at which the present net values of the two investment opportunities are equalised. The ranking of investment opportunities, according to Fisher, depends on the rate of interest.

An investment opportunity may have a higher present value at a particular interest rate than at another. So if the rate of return over cost in case of one opportunity is higher than the market rate of interest, it will be accepted and the other opportunity will be rejected.

Its Criticism:

Fisher’s time preference theory has been characterised by Schumpeter as “the peak achievement, as far as perfection within its own frame is concerned, of the literature on interest.” But it is not free from certain weaknesses.

(1) Neglects Banking System:

Fisher’s theory is very general and fails to show the influence of the banking system on the rate of interest.

(2) Emphasis on Consumption:

The willingness principle is misleading because it lays too much emphasis on consumption of income.

(3) Silent about Expectations:

This theory is silent about the impact of expectations on interest rates. Even if interest rates are upward moving, expectations of high future returns can encourage investment.

(4) Too much Emphasis on Capitalisation:

Fisher has been criticised for laying too much emphasis on capitalisation. There may be divergences between capitalized rates in the rental markets and resale markets. For instance, rental returns on properties in poor areas might have values at capitalized rates but in the open markets their capitalized rates would be much lower.

(5) Neglects Demand Side:

It explains the determination of interest rate from the supply side and neglects the demand side altogether.

Essay # 5. The Classical Theory of Interest :

According to the classical theory, the rate of interest is determined by the supply and demand of capital. The supply of capital is governed by the time preference and the demand for capital by the expected productivity of capital. Both time preference and productivity of capital depend upon waiting or saving. The theory is, therefore, also known as the supply and demand theory of waiting or saving.

Demand Side:

The demand for capital consists of the demand for productive and consumptive purpose. Ignoring the latter, capital is demanded by the investors because it is productive. But the productivity of capital is subject to the law of variable proportions. Additional units of capital are not as productive as the earlier units. A stage comes when the employment of an additional unit of capital in the business is just worthwhile and no more.

Suppose an investor invests Rs.1, 00,000 in a factory and expects a yield of 20%. Another installment of an equal amount would not be as productive as the first one, and might bring him 15%, while a third installment might yield 10%.

If he has borrowed the money at 10%, he will not venture to invest more. For the rate of interest is just equal to the marginal productivity of capital to him. It shows that at a higher rate of interest, the demand for capital is low and it is high at a lower rate of interest.

Thus the demand for capital is inversely related to the rate of interest and the demand schedule for capital slopes downward from left to right. There are, however, certain other factors which govern the demand for capital, such as the growth of population, technical progress, process of rationalization, the standard of living of the community, etc.

Supply Side:

The supply of capital depends upon savings, rather upon the will to save and the power to save of the community. Some people save irrespective of the rate of interest. They would continue to save even if the rate of interest were zero. There are others who save because the current rate of interest is just enough to induce them to save. They would reduce their savings if the rate of interest fell below this level.

Still there are the potential savers who would be induced to save if the rate of interest were raised. To the last two categories of savers, saving involves a sacrifice, abstinence or waiting when they forego present consumption in order to earn interest. The higher the rate of interest, the larger will be the community savings and more will be the supply of funds. The supply curve of capital thus moves upwards to the right.

Determination:

Assuming the level of income to be given, the rate of interest is determined by the interaction of the demand curve, D and the supply curve of saving, S. This is shown in Figure 1 where the D and S curves intersect at E which is the equilibrium point when OQ quantity of capital is demanded and supplied at OR rate of interest.

If at any time, the rate of interest rises above OR to OR, the demand for investment funds will fall and the supply of savings will increase.

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Economic Effects of Higher Interest Rates (Revision Essay Plan)

Last updated 4 May 2019

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Here is an essay plan to this question: "To what extent can a policy of higher interest rates lead to an improvement in macroeconomic performance. Discuss with reference to a country of your choice."

Background (not part of the essay)

Central banks around the world cut interest rates sharply during the 2007-2009 financial crisis. Rates remained at historic lows for many subsequent years close to or below 0% in most developed economies. In the United States, the Federal Reserve has gradually increased interest rates from 0.25% to 2.5% risen against a backdrop of jobs growth and a stronger economy.

KAA Point 1: Controlling inflationary pressures

Higher interest rates might be justified on the grounds of helping to control inflationary pressures. E.g. USA Fed Reserve has been raising rates (from 0.25% to 2.5%) because unemployment is very low (<3%) and therearesignsofanover-heatingeconomy.Low,stableinflationhelps to promote macro stability – keeps domestic economy competitive and reduces business uncertainty. Monetary policy can stabilise the cycle.

EVAL Point 1: Currency appreciation

A counter point is that higher interest rates might cause an inflow of hot money (SR capital flows) into an economy thus causing a currency appreciation. This can make export industries less price competitive which might lead to a slowdown in export sector output, investment and employment as well as a worsening of the net trade balance. Much depends on how open a country is to overseas trade.

KAA Point 2: Higher returns for savers & retirees

A rise in nominal interest rates improves returns for savers – many of whom have lost out in real terms in the decade since the Global Financial Crisis. Higher savings helps to repay debt, can act as a buffer against macro uncertainty, and increases flow of deposits into commercial banks which (in theory) creates more liquidity to support a rise in bank lending to finance business investment which can increase long run AS.

EVAL Point 2: Risk of a growth slowdown

In evaluation, there is no guarantee that commercial banks will lend out more if returns to savers improve. Indeed a rise in interest rates across the board is likely to lead to a contraction in bank lending and make borrowing more expensive especially for smaller businesses and households who have become dependent on expensive unsecured credit. The risk is that a sharp rise in interest rates could cause a growth slowdown.

FINAL CONCLUSION: Interest rates and smoothing cyclical volatility

The decision by central banks such as the Federal Reserve and the Bank of England to start tightening monetary policy by raising interest rates are often finely balanced. In the UK for example, real GDP growth in 2018 was only 1.4% - the slowest for five years and CPI inflation remains under the 2% target. Even though unemployment is very low, there seems little macroeconomic justification for increasing interest rates at present. The situation in the United States might be different. Growth has been strong, share prices have soared and unemployment has fallen sharply. The ability of a central bank to smooth inevitable cyclical fluctuations depends in part on having room for adjustment. The US might decide to lift interest rates back up to a level closer to 3%, to give them flexibilitytolower rates and stimulate borrowing and investment in the event of a recession.

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Terry Burnham: a Portrait of a Economics and Finance Visionary

This essay about Terry Burnham provides a comprehensive introduction to a figure who has made significant contributions to the fields of finance and economics. Detailing Burnham’s educational background, the essay highlights his academic achievements, including advanced degrees from prestigious institutions. It explores his professional expertise, focusing on his work in behavioral finance, and how his research and theories have influenced industry practices and academic discussions alike. Notable achievements, such as his contributions to understanding market dynamics and human behavior in economic contexts, are also discussed. Through this overview, the essay paints a picture of Burnham as a thought leader whose work spans across theoretical and practical aspects of economics and finance, underscoring his impact on these fields.

How it works

Terry Burnham is a name that resonates with depth and diversity in the realm of finance and economics. His journey through the academic and professional world showcases a relentless pursuit of understanding how financial markets operate, intertwined with a keen interest in behavioral economics. This essay aims to introduce Terry Burnham, touching upon his educational background, professional expertise, and his noteworthy contributions to the fields he has ventured into.

Burnham’s educational path is as illustrious as it is foundational to his later achievements.

With a bachelor’s degree from MIT, where the seeds of his analytical prowess were sown, he further honed his expertise at Harvard University, earning a Ph.D. in Business Economics. This period of rigorous academic training was not just about acquiring knowledge but about challenging existing paradigms, a theme that would recur throughout his career.

Professionally, Burnham has worn many hats, each contributing to his reputation as a polymath in economics and finance. His tenure as a professor at Harvard Business School allowed him to impart knowledge and inspire a new generation of economists and financial experts. However, the academic world was just one stage for his talents. Burnham’s foray into the practical world of finance saw him taking on roles that ranged from being a quantitative strategist at Goldman Sachs to managing billions in investment strategies, showcasing his ability to apply complex theories to real-world scenarios.

One of Burnham’s notable achievements is his work on the application of Darwinian principles to financial markets. His book, “Mean Markets and Lizard Brains: How to Profit from the New Science of Irrationality,” explores how evolutionary psychology influences financial decisions, offering insights into why markets behave irrationally and how investors can navigate these waters. This work is emblematic of Burnham’s approach: blending disciplines to uncover deeper truths about human behavior and market dynamics.

Moreover, Burnham’s expertise and insights have not been confined to academia and private practice alone. He has been a vocal commentator on the state of global financial markets, contributing to the discourse on economic policies, market predictions, and investment strategies through various media outlets. His ability to demystify complex economic concepts and present them in an accessible manner has made him a sought-after voice in discussions about finance and economics.

In reflecting on Terry Burnham’s career and contributions, it becomes evident that his impact extends beyond the sum of his professional roles. His work challenges us to think critically about the forces that shape financial markets and our own decision-making processes within them. Burnham’s interdisciplinary approach—melding finance, economics, and psychology—invites us to look at markets not just as abstract entities but as ecosystems driven by human behavior and evolutionary biases.

In conclusion, Terry Burnham’s journey through the worlds of academia, finance, and beyond is a testament to his intellectual curiosity and his commitment to exploring the undercurrents of economic and financial phenomena. His contributions have enriched our understanding of markets, making him a pivotal figure in contemporary discussions about finance and economics. As we continue to navigate the complexities of global financial systems, Burnham’s insights and methodologies offer valuable tools for deciphering the often-irrational world of finance, making his work not only relevant but essential for anyone looking to understand the nuances of economic behavior and market dynamics.

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Consumer price growth accelerated in March, adding to cloudy picture for U.S. economy

Inflation remained elevated once again in March, adding another round of price increases to Americans' already-strained wallets.

The Bureau of Labor Statistics reported that 12-month price growth accelerated from 3.2% in February to 3.5% in March, matching consensus forecasts among economists.

Excluding food and energy, which represent commodities with more volatile prices, the so-called core 12-month reading was unchanged in March at 3.8%.

Some of the items seeing the largest 12-month leaps in price gains included auto insurance, which soared 22.2%; domestic services like home cleaning, up 10.9%; baby food and formula, up 9.9%; and outpatient hospital services, up 8.3%.

If there was any relief, it was in grocery prices, which were up just 1.2% on the year. And prices for new and used vehicles fell.

But Greg McBride, chief financial analyst at Bankrate, put the situation succinctly in an email following Wednesday's release.

“There is no improvement here, we’re moving in the wrong direction,” he said.

On paper, the U.S. economy has looked solid. The unemployment rate has now remained below 4% for the longest stretch since the 1960s. Stocks have been at all-time highs. The economy continues to add jobs.

But since the start of the pandemic, Americans have seen average prices increase more than 20% overall — giving people a sense that the cost of many goods and services, not to mention housing, has surged to unreasonable levels.

When will prices come down?

So what will cause price growth to finally slow down to the Federal Reserve's 2% target?

Unfortunately, it usually takes a major economic crisis for broad categories of prices to reverse. Instead, the best that consumers can hope for is that they stop going up so fast.

While there are some signs that it's happening — grocery price increases, for instance, have finally fallen below 2% after surging during the pandemic — economists say it's likely to still take some time for inflation to truly subside.

Complex economic forces, they say, continue to keep price growth elevated.

A significant worker shortage sparked by the pandemic — especially for front-line service employees — helped push hourly pay higher. But this resulted in pushing up prices on the consumer side, since labor costs represent a significant portion of the overall cost of given goods or service.

Meanwhile, supply chain disruptions that emerged during the pandemic have yet to fully subside, said Sarah House, a managing director and senior economist at Wells Fargo.

She pointed to automobile prices, which have surged more than 20% since the start of the pandemic for new vehicles and more than 30% for used vehicles. While the pace of their price increases has abated, difficulties in sourcing auto parts, plus the loss of experienced technicians, have pushed vehicle prices higher.

This, in turn, has pushed auto insurance rates higher — and it turns out that car insurance commands a significant percentage of the overall increase in consumer prices.

“The services side is where we’re continuing to see stronger [price] growth,” House said. “That’s where we’re still getting an elevated degree of inflation from.”

Stagnant pay and higher borrowing costs

Americans’ pay has barely kept up with the price increases. While federal stimulus at the outset of the pandemic helped give people a cash cushion during the worst of it, there is an emerging consensus that this same cushion helped drive prices higher by giving people money to spend.

On net, Bureau of Labor Statistics data shows that the effect of inflation has caused Americans’ average hourly pay to rise by just a few cents compared with where it was at the start of the pandemic.

The Federal Reserve, which is in charge of taming price growth, in part by raising interest rates, has sought to fight fire with fire. By raising the cost of borrowing money, the central bank has tried to reduce demand for goods and services, ultimately pushing price growth down.

The Fed’s interest rate hikes have indeed caused borrowing costs for everything from credit cards to automobiles to homes to climb to levels not seen in years.

For many Americans, that’s meant getting locked out of the housing market, not to mention paying credit card rates above 20% and auto loan rates above 8%.

But inflation has persisted, surprising many economists. At the start of the year, the consensus forecast was for economic growth to slow, allowing the Fed to start cutting interest rates this spring, with a total of three cuts for 2024.

But a growing number of analysts now say that, at a minimum, rate cuts will be delayed. Still others say there won’t even be three cuts.

Despite all the challenges, the risk of a recession that would lead to significant job losses remains low. Yet there are signs that consumer jitters are accelerating. The New York Federal Reserve reported Monday that fears of job losses are climbing and that workers who are already out of a job say getting hired is now more difficult than it was prior to the pandemic.

While about one-quarter of Americans report their household financial situation to be better than a year ago, about one-third report being worse off.

It all adds up to a precarious situation. In a speech last week, Federal Reserve Chair Jerome Powell called the economic outlook "still quite uncertain."

"The job of sustainably restoring 2% inflation is not yet done," he said.

Rob Wile is a breaking business news reporter for NBC News Digital.

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Jamie Dimon Issues an Economic Warning

The JPMorgan Chase chief executive used his annual letter to shareholders to flag higher-for-longer inflation, uncertain growth prospects and widening political divisions.

By Andrew Ross Sorkin ,  Ravi Mattu ,  Bernhard Warner ,  Sarah Kessler ,  Michael J. de la Merced ,  Lauren Hirsch and Ephrat Livni

Jamie Dimon sees America at a ‘Pivotal Moment’

Jamie Dimon’s annual letter to JPMorgan Chase shareholders has just been published. The widely read note offers a glimpse of his views on not just business, but the economy at a “pivotal moment for America and the free world,” with deep divisions at home and global uncertainty.

Here are some highlights.

The economy is resilient but the government underpinning it is a red flag. Consumers are spending and investors expect a soft landing. But Dimon warns that the economy is being fueled by government spending and rising deficits. “The deficits today are even larger and occurring in boom times — not as the result of a recession — and they have been supported by quantitative easing, which was never done before the great financial crisis,” he writes.

Inflation may be sticky. “These markets seem to be pricing in at a 70% to 80% chance of a soft landing — modest growth along with declining inflation and interest rates,” Dimon writes, adding that the odds are actually a lot lower.

Global uncertainty is another dark cloud. The wars in Ukraine and the Middle East could further “disrupt energy and food markets, migration, and military and economic relationships.” That shock coincides with a surge in public investment to power a green transition, restructure supply chains and trade relationships, and boost health care spending.

Industrial policy is needed but should be limited and targeted. Dimon says the U.S. must be tough with China, but engage with Beijing. That includes establishing independence on supplies of materials crucial to national security, like rare earth, semiconductors and 5G infrastructure. (According to Dimon, the Inflation Reduction Act and the CHIPs Act get it right.)

Dimon warns about the deep political divisions at home. Dimon doesn’t explicitly weigh in on the election (his public backing for some of Donald Trump ’s economic policies caused a stir at Davos in January), but said the U.S. is grappling with “highly charged, emotional and political” issues centering around the border security crisis and the “fraying of the American dream.”

On Basel 3 endgame: Dimon reiterated his concerns that many of the proposed banking rules are “flawed and poorly calibrated.”

On corporate governance: Dimon argues that proxy advisory firms like ISS have become too influential (he recently backed Disney in its fight against Nelson Peltz). He is opposed to recent efforts to split chairman and C.E.O. roles and thinks the universal proxy “makes it easier to put poorly qualified directors on a board.”

HERE’S WHAT’S HAPPENING

Janet Yellen sees progress in China relations, but warns there’s “more work to do.” The Treasury secretary concluded meetings in Beijing on Monday saying that ties between the nations had stabilized, but it was unclear how the relationship would endure in an election year. Her comments came as the Biden administration agreed to give Taiwanese chipmaker TSMC $6.6 billion in grants to begin manufacturing in Arizona in 2028.

Brazil’s supreme court opens an investigation into Elon Musk. Alexandre de Moraes, the chief justice, opened the instruction of justice inquiry after Musk said he would reactivate some X accounts that the judge had ordered blocked. The accounts weren’t disclosed. Moraes has been investigating “digital militias” accused of spreading disinformation.

Gold hits a record high and an oil rally takes a breather. The safe-haven asset reached more than $2,300 a troy ounce , buoyed by worries over a widening conflict in the Middle East and higher demand for the precious metal from central banks and Chinese consumers. The price of Brent crude fell on Monday to trade near $90 a barrel, down from a five-month high reached last week.

Is it show time for Warner Bros. Discovery?

Today marks the two-year anniversary of the Warner Bros. Discovery mega deal closing. Crossing that milestone means that the entertainment giant, which owns HBO, CNN and a lucrative piece of the March Madness broadcasts, can now strike a deal without facing a huge tax hit.

The industry is ripe for consolidation , given challenges in cable and streaming. An obstacle is President Biden’s antitrust cops. “Regulatory constraints are limiting what deals can get done, which is the case in most industries,” Rob Kindler, the global chair of the M.&A. Group at Paul, Weiss, told DealBook.

Warner Bros. Discovery hasn’t gone as hoped. Its stock is down 66 percent since the deal closed as its bet on streaming has languished (alongside rivals not named Netflix). The legacy cable business has been a bigger drag, hurt by cord-cutting.

Its $44 billion debt mountain could also make an acquisition more difficult. But John Malone, the media mogul and a board member, said in November that cash flow is improving, which could set the company up to scout for deals.

A merger with Paramount seems unlikely. Shares fell 5 percent when talks between the two leaked in December, a sign that investors may not look enthusiastically on the company increasing its exposure to linear media. It’s probably a moot point anyhow with Paramount in exclusive talks with Skydance .

Even still, would an alliance with Paramount’s TV networks, like, CNN and CBS through a spinoff or divestiture make sense, down the line?

Targeting Comcast could face challenges, too. Investors may like the potential to combine their cable, studio and streaming businesses. But regulators would likely have tough questions.

Still, don’t count out a deal. As Barry Diller told The Times last year : There seems to always be interest in the Warner media properties. “Whether that will happen depends on whether someone wants to take it,” said Diller, a longtime friend of the Warner Bros. Discovery chief, David Zaslav.

Rethinking the deals-are-bad trope

For decades, the common wisdom in corporate America — as encapsulated in the 2004 book “Mastering the Merger,” by two Bain & Company consultants — was that for all the billions spent on mergers, roughly 70 percent failed.

But a new white paper by one of the book’s authors and two other colleagues finds that the inverse is now true: 70 percent of takeovers succeed . DealBook got the first look at the research to learn what had changed.

Companies have gotten smarter about M.&A. In 2004, the defining deals of the era — including that of AOL-Time Warner — were meant to be transformative and deliver big savings. Today the goals are more modest, such as expanding into new geographies or adjacent businesses, or adding new talent.

Acquirers are also getting more practice. Having more-conservative aims for mergers means companies can do more of them, justifying having in-house teams of M.&A. specialists who can better identify promising acquisitions and make them work. One advancement: more sophisticated analysis of potential takeovers, compared with earlier deals that often relied on less exacting financial considerations like synergies.

“Frequent acquirers have the experience and capability to do the diligence that’s required,” Suzanne Kumar, a Bain vice president and one of the white paper’s authors, told DealBook, pointing to Thermo Fisher Scientific, Constellation Brands and tech giants.

Serial acquirers tend to have better returns. Between 2000 and 2010, companies that did at least one deal a year had 10-year total shareholder returns that were 57 percent higher than businesses that did no deals, Bain found. Between 2012 and 2022, that spread rose to 130 percent — a finding that surprised the researchers.

Unionization efforts come to Harvard Yard

With car companies on high alert over the United Auto Workers’ efforts to ramp up labor organizing, the union has racked up a series of wins far from the factory floor — on college campuses.

The most recent victory was at Harvard University. The school’s nontenure track employees — a group of roughly 6,000 that includes faculty, postdoctorate fellows and preceptors — overwhelmingly voted to unionize last week. That opens the door to negotiations for higher wages, improved job security and bolstering workplace protection.

The divide brings another source of tension to campus. Harvard has been embroiled in a fight over free speech and safety ever since Hamas attacked Israel on Oct. 7, spurring a debate that led to a wave of high-level resignations.

Harvard is far from alone. Staff at Wellesley College and New York University also voted to unionize this year, joining efforts by adjunct professors and postdocs at Boston University, Columbia, Rutgers and the University of Connecticut.

The U.A.W. is at the center of the push. The union has been branching into higher education for years. And its hard-knuckled tactics in securing new contracts from Detroit’s Big Three automakers last year have given it momentum.

After N.Y.U.’s successful unionization vote, Shawn Fain, the U.A.W.’s president, hailed the moment as a historic one for labor organizing efforts on America’s university campuses. “We’ve got their back,” he said .

The week ahead

Congress returns today from its two-week recess to find Ukraine, the TikTok bill and repairing the Baltimore bridge in the spotlight — and a possible House leadership challenge looming. Elsewhere, inflation, central banks and the new earnings season will also be in focus.

Here’s what to watch:

Tuesday: Google’s Cloud Next developers conference opens amid expectations that the tech giant will make a raft of announcements to do with artificial intelligence.

Wednesday: The March Consumer Price Index is set for release. Economists forecast that overall inflation rose by 3.5 percent on an annualized basis, a slight increase from February. Core C.P.I., which removes food and fuel, is expected to have cooled.

Minutes from the last Fed meeting are also due to be published.

Elsewhere, President Biden will hold talks at the White House with Prime Minister Fumio Kishida of Japan. On the agenda : trade, A.I. and China. Also looming over the summit is Nippon Steel’s $14 billion bid for U.S. Steel.

Thursday: It’s decision day on rates for the European Central Bank. Inflation has fallen relatively quickly across much of Europe, prompting the question: Will the E.C.B. cut interest rates before the Fed?

Friday: Wall Street giants begin reporting first-quarter results, including JPMorgan Chase, Wells Fargo, Citigroup and BlackRock.

THE SPEED READ

The luxury group Puig, owner of the brands Paco Rabanne and Charlotte Tilbury, plans to list in Spain and aims to raise more than 2.5 billion euros ($2.7 billion) in what would be the sector’s biggest I.P.O. in years. (FT)

Could investors’ relative apathy for European stocks push the continent’s biggest oil companies to consider bigger listings in the U.S. ? (Bloomberg Opinion)

Josh Shapiro, the Democratic governor of Pennsylvania, has warned that the Biden administration’s decision to pause liquefied natural gas projects could hurt the party’s chances in November. (FT)

“ Maryland Passes 2 Major Privacy Bills , Despite Tech Industry Pushback” (NYT)

Best of the rest

Solar eclipse mania has gripped North America, and there’s good news : The weather should cooperate for a decent viewing across big parts of the U.S. (NYT)

South Carolina has topped Caitlin Clark and Iowa to win the women’s national basketball championship. Up tonight: UConn takes on Purdue — and there’s a Bill Murray connection . (The Athletic, WSJ)

We’d like your feedback! Please email thoughts and suggestions to [email protected] .

Andrew Ross Sorkin is a columnist and the founder and editor at large of DealBook. He is a co-anchor of CNBC’s "Squawk Box" and the author of “Too Big to Fail.” He is also a co-creator of the Showtime drama series "Billions." More about Andrew Ross Sorkin

Ravi Mattu is the managing editor of DealBook, based in London. He joined The New York Times in 2022 from the Financial Times, where he held a number of senior roles in Hong Kong and London. More about Ravi Mattu

Bernhard Warner is a senior editor for DealBook, a newsletter from The Times, covering business trends, the economy and the markets. More about Bernhard Warner

Sarah Kessler is an editor for the DealBook newsletter and writes features on business and how workplaces are changing. More about Sarah Kessler

Michael de la Merced joined The Times as a reporter in 2006, covering Wall Street and finance. Among his main coverage areas are mergers and acquisitions, bankruptcies and the private equity industry. More about Michael J. de la Merced

Lauren Hirsch joined The Times from CNBC in 2020, covering deals and the biggest stories on Wall Street. More about Lauren Hirsch

Ephrat Livni reports from Washington on the intersection of business and policy for DealBook. Previously, she was a senior reporter at Quartz, covering law and politics, and has practiced law in the public and private sectors.   More about Ephrat Livni

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