Transcript Economic Growth - PowerPoint Presentation

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Collect in homework - Keynes
http://www.bbc.co.uk/news/business-35657308
Economic Growth
Learning Objectives
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Recap the definition of Economic
Growth.
Illustrate Economic Growth in the Shortrun and the Long-run.
Analyse the positive and negative
aspects of economic growth.
Have the tools available to evaluate
whether economic growth is the most
important government objective.
Starter
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Define economic growth
How do we measure economic
growth?
What causes the economy to grow?
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List as many reasons as possible
Economic Growth
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Growth in the productive potential
of the economy. It is typically
measured by growth in real GDP.
Illustrate Economic Growth
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Illustrate economic growth in the SR and
the LR using AD, AS models and a PPF
curve.
SR – An increase in any of the
components of AD will create short term
growth (pushing the economy back to
trend).
LR – A shift in LRAS to the right and a
shift in the PPF curve out.
Economic Growth in the SR
Economic Growth in the Long Run
Economic Growth in the Long Run
Capital Goods
B
K2
A
K1
C1
C2
Country operating at full
capacity but discovers new
resources or find ways of
improving the efficiency of
existing resources, for example,
education of the population to
improve the quality of human
capital.
Consumer Goods
Learning Objectives
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Recap the definition of Economic
Growth.
Illustrate Economic Growth in the Shortrun and the Long-run.
Analyse the positive and negative
aspects of economic growth.
Have the tools available to evaluate
whether economic growth is the most
important government objective.
Economic Growth “Speed
Dating”
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You will need a new sheet of paper
On one side put the title “The
Positive Aspects of Economic
Growth.”
On the other side put the title “The
Negative Aspects of Economic
Growth.”
Positive vs. Negative Aspects of
Economic Growth Part 1
The class will be split into two teams
one side looking at the positive
aspects of Economic Growth and one
team at the negative aspects of
Economic Growth. A team leader will
be appointed for each team.
Positive vs. Negative Aspects of
Economic Growth Part 1
Each team leader must divide up the information
sheets which detail positive or negative aspects of
economic growth to the individuals in their team.
Each individual must ensure they (a) set a title for the
factor/issue they have been given, (b) can explain the
impact and (c) would be able to explain it to the rest of
the class.
The team leader must ensure that each member of
their team’s explanation is sound, the individual must
then write on their paper the title and description in 20
words or less.
Each team has 10 minutes in total to complete
this part of the activity.
Positive vs. Negative Aspects of
Economic Growth Part 2
Each individual within the team must be confident enough to
explain their positive or negative aspect to the rest of their
team.
The team leader must ensure that the individual has
explained their aspect clearly.
Once an individual has explained their aspect to the team,
the team must write it down in their own words on their
worksheet. If any members of the team are confused they
must ask the individual to clarify. The individual will tick this
off when they are satisfied.
The team are not to copy the other person’s worksheet, and
will be penalised if any copying occurs.
Each team has 6 minutes in total to complete this part
of the activity.
Positive vs. Negative Aspects of
Economic Growth Part 3
Each individual within the team must be confident enough
to explain their positive or negative aspect to another
member of the class.
This is a challenge between the two teams, once an
individual has explained their aspect to the opposition the
opposition must repeat what the aspect is and then write
down the title and description in their own words on their
paper.
Individuals are not to show the other person their
worksheet, and will be penalised if any copying occurs.
You will get 2 minutes on each date to exchange
positive/negative aspects of economic growth. You will
continue on your dates until you have completed your
worksheet.
What are the positive aspects of
economic growth?
1.
2.
3.
4.
5.
6.
7.
8.
9.
Higher Standards of Living
Foreign Direct Investment
Consumer Confidence
Tax Revenues
Impact on employment
Improved welfare support
Greater business confidence and
investment
New and more environmentally friendly
technology
A route out of poverty
What are the negative aspects of
economic growth?
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Inflation
Externalities of Growth
Increase in Crime and Social problems
Higher Economic Growth has led to more hours
worked
Diseases of Affluence
Current Account deficit worsening
Resource depletion
Inequalities in the distribution of income and
wealth (North/South divide)
Urbanisation, the spread of cities and loss of land
In the early phases, a rapid growth of population
and people that are poor
Create a mind map of how the
government encourages economic
growth
How does the
government
encourage economic
growth?
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Hint How do they manipulate the components of AD
to increase growth? How do they improve the supply
of the economy in the LR?
Exam Question
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Evaluate whether economic growth
is the most important government
objective (25 marks)
Homework: Due in Monday 14th
March.
Summary
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What is economic growth?
How would you illustrate economic
growth in the SR? and the LR?
Give three reasons why economic
growth is an important government
objective.
Economic Growth
AD = C+I+G+(X-M)
Economic Growth
Economic Growth