Free Economics NotesBy Kevin Bucknall BSc(Econ), PhDCopyright 2012 Kevin Bucknall potx

[...]... growth and is the major source in developed countries * With a totally free market there is less for the national government to do This might help to prevent the emergence of a dictatorial government that spends money and behaves in ways that the people do not want Totally free markets also tend to go along with some form of democracy A free market cannot prevent a brutal dictatorship but if it goes hand... that you have got what you wanted, then you can stop reading now! On the other hand, if you feel that you would like to go further and understand more, then you can download and read my free book An Introduction to Economics that explains this article in much greater detail It also provides diagrams to illustrate and help analyse the issues ~~~ Chapter 2 Trying to Make Sense of Economic Policy—Part... in the middle, or poor It is often measured as percentiles or deciles or more formally by using a technical measure, the Gini Coefficient If you want more information you can download a free book An Introduction to Economics as a zipped PDF file Journalists might present the issue in the form of how much of the country is owned by what per cent of the people As an example, in the USA in the year 2001,... the surplus was extracted for reinvestment in the economy Forced industrialization of this kind is only possible with strong central control and restricted levels of freedom; this does not occur in Westernstyle democracies with their free voting Any government attempting it would be voted out at the next election It is now widely accepted that such a process of forced industrialization ensures poor... different causes too With globalisation, which means more interlinked economics and faster transmission belts for the effect of events, it seems likely that cycles may get larger and more world-wide than they once were but even this is not certain We still have a lot to learn: perhaps we always will have ~~~ Chapter 5 Understanding Economics: a Summary of the Advantages and Disadvantages of the Price... political) The price mechanism lies at the heart of western economic theory Anyone studying economics comes across the phrase “price mechanism” (or “market mechanism”) and it is a popular topic for setting in essays or in examinations Here we look at what is good about it and what is bad The advantages of a totally free market * It allocates resources where people want them; we get maximum consumer satisfaction... increased level of personal consumption or else save more for their future * It allows the maximum economic freedom to the people to spend their own money in their own way * People have the choice for whom they will work and in what industries or service sectors they will spend their lives * People have the freedom to set up their own businesses and try to do better in life for themselves and their families... the world is, and in addition, there is no going back The reply to this response may well be unprintable It has to be stated that economics, and the workings of an economy, are amoral; morality, ethics and justice simply do not appear We believe that the price mechanism, free trade, and ultimately globalisation produce a more efficient system, a higher standard of living, and faster economic growth... us the answer to whatever question we are interested in Having said that, attention mostly focuses on the current account and changes in it, because it shows how well we are currently doing That's it, economics in a nutshell Warning! It is necessarily a limited explanation and misses out much; it is no more than a simplified, basic introduction to a complex and fascinating discipline There are many... economic goals, the biggest wonder is that the authorities ever get it even remotely right and yet they do! Those guys do their best and really are good, especially when one imagines that they need to know economics, mathematics, statistics, a bit of psychology and, most important of all, have an awful lot of luck ~~~ Chapter 4 Business Cycles, Recessions and Economic Booms What are business cycles? They .