economics II Flashcards
1
Q
Increased roundaboutness increases…
A
Complexity
2
Q
Difference between technical & social DOL?
A
Technical: internal DoL, vertical integration
Social: external DoL, vertical disintegration
3
Q
What is the deciding factor for vertical integration?
A
Cost efficiency
Transaction costs
4
Q
Economies of scale?
A
Produce more to save more
5
Q
Economies of scope?
A
Vary products more to save more
6
Q
Marshall’s 3 forces of agglomeration?
A
- Increase efficiency between firms
- Pools of local labour
- “Something in the air”
7
Q
3 causes of resource curse?
A
- Income volatility
- Exploitation types (rent-seeking, patronage & living off the land)
- Dutch Disease
8
Q
3 causes of income volatility?
A
- Commodity price variation
- Rate of extraction
- Timing of receipt
9
Q
What is the Dutch disease?
A
Booming resource sector, withering manufacturing & agricultural sectors.
