Micro and Macro Aspects of Policies to Reduce a Trade Deficit | Synoptic Paper 3 | A Level Economics

In this synoptic revision video we examine and evaluate some micro and macro policies that might be used to help reduce the size of the UK's trade deficit.

#ukeconomy #tradedeficit #macroeconomics

VIDEO TIMESTAMPS

00:00 - Introduction to micro and macro aspects of policies to reduce a trade deficit
00:27 - UK's trade deficit in goods and services
01:02 - Micro policies: Export subsidies, tax breaks, affordable loans, and trade insurance
02:06 - Micro policies: Human capital investment, apprenticeships, and entrepreneurship
03:12 - Macro policies: Depreciation of the exchange rate and infrastructure spending
04:15 - Evaluation of macro policies and distinction between cyclical and structural causes
05:22 - The impact of exchange rate changes on trade balance
06:20 - Long-term effectiveness of micro policies and the risk of government failure
06:50 - Conclusion and invitation to like and subscribe

VIDEO SUMMARY

This video explores the micro and macro policies that can help reduce a country's trade deficit, using the UK as an example.

Micro policies focus on individual industries and labour markets, suggesting measures like export subsidies, input subsidies, tax breaks, and investment encouragement to boost exports. Another approach is investing in human capital and entrepreneurship to increase labour productivity and competitiveness.

On the macro level, policies can include engineering a depreciation of the currency to improve price competitiveness and increasing infrastructure spending to reduce costs and improve trade. Evaluating these policies requires considering both cyclical and structural causes of the trade deficit, and micro policies may be more effective in the long run for improving non-price competitiveness. However, there are potential risks and inefficiencies associated with targeted government interventions.

[th]

these are great for paper 3, keep them going! Thanks Geoff

[zoyagallan]

pls cld u do micro macro effects of globalisation?

[rosettegolda]

Thanks Geoff - feeling less in the dark about paper 3 with your vids :)