Specification Content

Seite 1

Globalisation

The causes of globalisation

The main characteristics of globalisation

The consequences of globalisation for less-economically-developed-countries (LEDC's) and for more-economically-developed-countries (MEDC's)

The role of multinational corporations in globalisation

Seite 2

Trade

The model of comparative advantage

The distinction between comparative and absolute advantage

The model shows that specialisation and trade can increase total output

Other economic benefits of trade - such as; the ability to exploit economies of scale and increased competition

The costs of international trade

The reasons for changes in the pattern of trade between the UK and the rest of the world

The nature of protectionist policies - such as; tariffs, quotas and export subsidies

The causes and consequences of countries adopting protectionist policies

The main features of a customs union

The main characteristics of the Single European Market (SEM)

The consequences for the UK of it's membership of the European Union (EU)

The role of the World Trade Organisation (WTO)

Use simple numerical examples to illustrate the principle of comparative advantage and the associated benefits of trade

Use a diagram to illustrate the effects of imposing a tariff on imports

Discuss the arguments for and against the UK's membership of the EU

Seite 3

The Balance of Payments

The difference between the current, capital and financial accounts on the balance of payments

The current account comprises of trade in goods, trade in service, income flows and transfers

The meaning of a deficit and a surplus on the current account

The factors that influence a country's current account balance - such as; productivity, inflation and the exchange rate

The consequences of investment flows between countries

The policies that might be used to correct a balance of payments deficit or surplus

Expenditure-switching and expenditure-reducing policies

The effect policies used to correct a deficit or surplus may have upon other macroeconomic policy objectives

The significance of deficits and surpluses for an individual economy

The implications for the global economy of a major economy or economies with imbalances deciding to take corrective actions

Have detailed knowledge on the structure of a current account of the balance of payment but only need a general appreciation of the other sections of the balance of payments account

Appreciate the difference between foreign direct investment (FDI) and portfolio investment

Seite 4

Exchange Rate Systems

How exchange rates are determined in freely floating exchange rate systems

How Governments can intervene to influence the exchange rate

The advantages and disadvantages of fixed and floating exchange rate systems

Advantages and disadvantages for a country of joining a currency union - e.g; the Eurozone

Seite 5

Economic Growth and Development

The difference between growth and development

The main characteristics of less-economically-developed-economies (LEDC's)

The main indicators of development - including; the Human Development Index (HDI)

Factors that affect growth and development - such as; investment, education and training

Barriers to growth and development - such as; corruption, institutional factors, poor infrastructure, inadequate human capital and lack of property rights

Policies that might be adopted to promote economic growth and development

The role of aid and trade in promoting growth and development

Appreciate links between this topic and other parts of the specification - such as; globalisation, trade, the determinants of economic growth and inequality

Comparison between market-based strategies and interventionist strategies for promoting growth and development