Hey all, here are your weekly updates on the UK and global economies!

UK Economy

- The Lower Thames Crossing has cost £1.2bneven before construction starts (opportunity cost!)

- Lloyd's has shifted skilled IT recruiting from the UK to India, with 6,000of its employees having already received warning about the potential of them losing their jobs (what does this say about the cost and productivity of UK workers?)

- UK construction activity last month fell at the fastest pace since May 2020, as housebuilding plummeted due to weak demand amid low consumer confidence and poor economic growth

Global Economy

- Trump has decided to delay his tariffs on Mexico and Canada by one month(were they going to cause more harm than good to the US economy?)

- China has set its growth targets to 5% despite the US tariff scare

- The cost of borrowing in Germany is at its highest since since 1997

---

I got 96% in A-Level Economics - find all of my notes here

---

This week's A* essay plan (find 25 more using the link above):

Evaluate the microeconomic and macroeconomic impacts of Nationalisation (25)

Macro: Economic growth. Nationalisation creates jobs, increasing the quantity of labour, thus shifting LRAS outwards and increasing real GDP by Y to Y1. 

Eval National debt increases -> Labour’s nationalisation plans are estimated to cost £176bn -> the UK’s credibility falls as they accumulate more debt -> demand for bonds falls -> price of bonds falls -> yields increase -> servicing debt increases (don’t worry if you don’t understand this, even I still don’t fully, but just learn these chains of reasoning to explain why the cost of servicing debt -paying interest on government debt -increases). opp cost increases - less money to spend on NHS - obesity 6.5bn a year, more sick days - LRAS in

Micro: Increased consumer welfare - nationalised industries operate at allocative efficiency - if the industry or firm being nationalised is a natural monopoly like TFL then it will exploit huge economies of scale, lowering prices for consumers and maximising consumer surplus.

Eval: X-inefficiency may increase and dynamic efficiency may decrease because they are the only firm in the industry. This means that they don’t have the threat of competition which drives firms like Apple and Samsung to innovate. This could shift AC and MC upwards, raising prices for consumers from p to p1, therefore not maximising consumer surplus.