June 23, 2018

China’s Belt and Road Initiative: the most ambitious development plan ever conceived?

With the Belt and Road Initiative (BRI), President Xi Jinping plans to link China to Europe via investments in rail, roads, ports, dams, bridges, gas pipelines and power plants. There are now links between 66 countries across Asia and Europe, with some estimating the final cost of the project to be in the region of […]

Cape Town water supply: a small nudge in the right direction

At the beginning of 2018, experts predicted that Cape Town would be the first major city in the world to run out of water, and the date given for ‘Day Zero’ was 12 April 2018. This is a result of three years of drought. Residents at that time will only be able to have 25 […]

The story from Denmark: happiness trumps GDP

The happiest countries in the world are mainly in Northern Europe, with Denmark coming out top. The highest scores for happiness did not come from income alone, but from political freedom and an absence of corruption. Individuals also valued job security and good mental and physical health. If that is true, why do economists insist […]

The tax debate continues

Income tax was introduced by William Pitt to the United Kingdom in 1799 to help meet the huge costs of fighting a war against Napoleon Bonaparte’s France. A later Prime Minister – William Gladstone – described income tax as ‘an engine of gigantic power for great national purposes’ despite his attempts to abolish it. Rates […]

Do economists care about inequality

The traditional view of economics is that it is a discipline that cares little for how the income and wealth of a nation is distributed. In Module 9.3 of our own text we come across the following: ‘How efficiently an economy’s resources are allocated and how evenly an economy’s income is distributed are not related. […]

Can Uganda teach the UK how to balance the budget?

When a government’s total outgoings (G) are more than their tax receipts (T), the result is a budget deficit where G > T. A government needs to borrow money to finance the debt, and interest payments can become so large that they cripple the economy. There are two main schools of thought for eliminating the […]

Economics on toast – the price of avocados

I enjoy eating avocados; they are high in good fats and supposedly great for my health. I noticed recently, however, that the price of avocados in my local supermarket has substantially increased. It appears that I am not the only one enjoying avocados; there has been a huge surge in demand for the fruit. While […]

I promise to pay the bearer

Money has three functions. It acts as: a medium of exchange; a unit of account; a store of wealth. On every Indian 500 Rupee note it states “I promise to pay the bearer the sum of Five Hundred Rupees.” It is signed by the Governor of the Reserve Bank of India (RBI). This allows Rupees […]