- Growth, Unemployment, Incomes, Living Standards + Poverty - Inflation - Balance of Payments - Technology Diffusion + LRAS - Government Finances

Micro and Macro Effects/Reasons etc. Flashcards by Ashton Mactavish

Micro Effects of Market Structures

Allocative Efficiency
Productive Efficiency
X Efficiency
Anti-Competitive Strategies
Price Discrimination

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Macro Effects of Market Structures

Dynamic Efficiency + LRAS
Jobs
Productive Efficiency + LRAS
Competitive Markets and Poverty Alleviation

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Micro Effects of Trade Union

Wages and Employment
Worker Rights + Protection
Monopsony labour market outcomes
Cost to firms
Wage Discrimination

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Macro Effects of Trade Union

Unemployment
Inflation
International Competitiveness, Trade + Current Account
FDI

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Micro Effects of Subsidy

Price + Consumer Surplus
Quantity + Market Failure
Affordability + Equity
Producer Revenue + Inefficiency
Cost to Government

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Macro Effects of Subsidy

Protect Domestic Producers + Workers
Inflation
International Competitiveness, Trade + Current Account
Government Finances
FDI

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Micro Effects of Privatisation/Deregulation

Allocative Efficiency
Productive Efficiency
X Efficiency
Dynamic Efficiency
Stakeholder Impacts (e.g. cost-cutting in safety or loss of welfare for workers)
Market Failures (Private firms will care less about social costs and benefits than government)

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Macro Effects of Privatisation/Deregulation

Productive + Dynamic Efficiency + LRAS
Employment/Unemployment
Infrastructure Building (Competitiveness + FDI)
Government Revenue from selling off firms

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Macro Effects of Free Trade

Current Account
AD, Growth, Unemployment
Inflation
Living Standards + Poverty
Dynamic Efficiency, Technology Diffusion + LRAS

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Micro Effects of Free Trade

Lower Prices, Consumer Surplus
Quantity + Choice
Competition (Static Efficiency)
Technology and Costs of Production
Economies of Scale

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Macro Effects of Supply Side Policies

Growth
Unemployment
Inflation
Current Account
Government Finances

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Micro Effects of Supply Side Policies

Productivity
Stakeholder Harm of Market Based Policies
Competition Benefits
Risk of Monopoly Power
Solve/Result in Market Failures

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Macro Effects of Growth

Incomes, Living Standards, Poverty
Unemployment
Inflation
Current Account
Government Finances

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Micro Effects of Growth

Market Failures (Environment)
Income Inequality
Individual Happiness (More to happiness than higher incomes e.g. Infrastructure, healthcare, education etc.)
Profits and Dynamic Efficiency

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Macro Effects of FDI

Growth, Unemployment, Incomes, Living Standards + Poverty
Inflation
Balance of Payments
Technology Diffusion + LRAS
Government Finances

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Micro Effects of FDI

Market Failures (Environment)
Welfare of Workers + Pay
Dynamic Efficiency (Costs, Productivity, Green Production)
Competition Distortion/Addition

Micro Effects of Minimum Wage

Income Inequality, Equity
Higher Prices, Lower Consumer Surplus
Producer Revenue / Profit
Individual Impact of Job Losses

Macro Effects of Minimum Wage

Unemployment
Inflation
Competitiveness + Trade
Government Finances

Micro Effects of Unemployment

Social Costs (e.g. crime)
Pool of Workers
Individual Costs
Worsening of Market Failures (e.g. drugs, alcohol)

Macro Effects of Unemployment

Lost Output
Government Finances (Loss of Tax Revenue, Spending on Benefits)
Hysteresis
Inflation (Phillips Curve)
Current Account

Micro Effects of Nationalisation

Allocative Efficiency (Solve Market Failure)
Lower Prices, Higher Quantity + Choice
Greater Economies of Scale
Skills, Training + Productivity

Macro Effects of Nationalisation

Government Finances
Employment
Inefficiency + Inflation
Dynamic Efficiency (LRAS)

Micro Effects of Market Based Development Policies

Allocative Efficiency
Dynamic Efficiency
Market Failures

Macro Effects of Market Based Development Policies

Growth, Incomes, Living Standards, Poverty
Jobs
Tax Revenue
Income Inequality

Micro Reasons for Protectionism

- Protect Workers (Higher living standards, Higher Wages) - Protect Against Dumping (Impact on Domestic Businesses and Jobs) - Protect Standards (Health and Safety, Environmental, Worker Rights)

Macro Reasons for Protectionism

- Infant Industries + Diversification (Economies of Scale) - Protect Against Unemployment - Tariff Revenue for Government - Solve Trade Deficit (Lower Import Expenditure)

Micro Causes of a Current Account Deficit

- Low Productivity - High Relative Minimum Wages - Strong Trade Unions - Resource Depletion

Macro Causes of a Current Account Deficit

- High Growth at Home (Leads to Increase in Imports) - Low Growth Abroad (Less Demand for our Exports) - Strong Exchange Rate - High Relative Inflation (Makes Exports less competitive) - Poor Investment (Technology and Capital outdated domestically, so costs higher) - Loss of Comparative Advantage (De-Industrialisation, Structural Unemployment)

Micro Barriers to Development

- Low Productivity (Low Incomes, Poverty Cycle, High Costs) - Poor Education, Health, Infrastructure (Detracts FDI, Reduced Competitiveness) - Volatile Commodity Prices - Resource Depletion - Power of MNCs

Macro Barriers to Development

- Protectionism Abroad (If country is export based) - Volatile Exchange Rate (Keeps FDI and Aid away) - Corrupt Governments - Low Savings + Investment - Unbalanced Growth (Overspecialisation, could lead to shock recession)

Micro Influences on International Competitiveness

- Productivity (Drives Labour Costs, Price Competitiveness of Exports and Ability to attract FDI) - Regulation (Higher Costs and Prices, Deters FDI) - Labour Market Flexibility (Keeps Prices and Costs Low, Attracts FDI) - Competition - Subsidies - Investment, R+D (Competitiveness), Banking Sector (Domestic Investment and FDI)

Macro Influences on International Competitiveness

- Tax Rates (Low Corporation Tax and VAT keeps Price Low and attracts FDI) - Relative Inflation - Exchange Rate - Infrastructure (Firms rely on transport infrastructure, so Lower Prices, attracts FDI) - Government Finances (Promotes Domestic Investment and FDI) - Protectionism (From foreign countries or us e.g. Tariffs on raw materials Increasing Prices)