micro Econ context Flashcards
(23 cards)
what shifts demand?give an example
technological advancement-decreased demand for restaurant dining due to Uber Eats and in print journalism
shocks-covid pandemic slowed the aviation industry
ecommerce businesses increased demand due to covid eg amazon and at home excersise eg peleton
what are some price elastic and price inelastic goods and services
elastic-furniture stores and motor vehicle stores
inelastic-electricity and water industries
what are some perfectly in/elastic goods and services
don’t exist to a lot of people
inelastic-lifesaving drugs eg insulin in America
elastic-book shops (lots of alternatives)
unitary price elastic
clothing
factors influencing supply w examples
natural disasters-turkey and syria earthquakes shifted In housing
tariff-uk December 31st 2020-decreased supply of fruit and veg
innovation-digital revolution in 2000s
perfectly inelastic supply
housing in major cities-london green belt policy
objectives of firms
covid vaccine:moderna -profit max Pfizer-ethicality-distributed vaccines free of charge
lush-ethicality objective as they do not test on animals
British Gas 2020 new minimum price-reversed to retain market share
survival-covid furlough schemes-lack of firms’ finance
perfect competition
agricultural industry
India:farming accounts for 55% of all jobs and 120 million people,e employed in the sector
monopolistic competition
fashion industry-tech advancement means use of online stores like boohoo and asos has allowed many buyers and sellers differentiated goods and lowered barriers to entry
furthermore budget airlines in the airline industries as planes are leased which allows for money sellers -wizzair,easy jet,jet2,ryanair
oligopoly
big 4 supermarkets own 70% of market share
Morrisons pay workers min £10 an hr
tesco set up leisure centres to boost areas
CSR
duopoly
boeing and airbus hold 90% of market share geopolitical and profit competition as Arbus is European and Boeing is American
monopoly
google, apple ,amazon
parler banned from App Store due to capitol incident - ‘prevention of free speech’
barriers to entry
legislation-FSA
apple monopoly power-imovie,garageband etc and amazon-amazon fresh and amazon prime
intellectual property rights used by pharmaceutical companies
climate change alternative industry-creative destruction of ford-norway uses electric cars
contestability
tech in the gaming industry has allowed fr competitors to develop apps and software-threat of entry
macro background for labour markets
2020-uk unemployment at 4.9%
trade union and pay discrimination
equal pay act-1970
friedman and thatcher’s dislike of trade unions due to real wage inflexibility-thatchers weakening of tu’s and Friedmans idea of continued discrimnation from tu’s
monopsony power
product market:NHS and big 4 supermarkets
labour market:NHS and Walmart(2.3 million)
most companies who can afford to pay workers higher wages do so to maintain brand strength -plt sweatshop scandal
distribution of wealth and income
covid has wiped out years of distributed incomes:
halted tourism
north south divide(southerners work in service industries and so cam work from home whereas northerners get fired as they work in manufacturing industries)
uk most unbalanced economy in Europe in terms of wealth and income
cases of intervention
bt exploits monopoly powers they used to own most of the fibre optic network
ofgem forces bt to open market to competitors
2018-cma blocks sainsburys and Asdas merger
regulation
establishing of digital markets unit -regulates firms w strategies market status (Facebook and google) in an ex ante manor
uk must be careful as this can deter investment
apple banning parler-concerns on free speech
regulatory capture-2016 energy companies stop showing profits to consumers and OFGEM side w/ no justification
de regulation
airline deregulation act in 1970s allowed for rise of contestability and low cost airlines
postal services market becomes more contestable due to deregulation of royalty mail
privatisation
privatisation of the water industry-before this water quality was bad-investment of 160 billion reduces pollution and improves quality-positive externality
however probation industry has had to be nationalised due to outcrys when it was private
government failure
cap and trade-gfc slowed activity therefore process permits dropped-failure as gov was unable to foresee this and had to make the MSR(market stability reversal)
mccarran-fergusson act 1945-states in us vary laws-tried to establish insurance firm regulation but was time consuming and expensive to monitor
