government failure case studies

Question 1

what % of cigarettes in the uk are believed to have been smuggles in illegally?

Answer 1

16%

Question 2

what is current VAT?

Answer 2

20%

Question 3

What is the common agricultural policy?

Answer 3

• direct payments to farmers to reduce their costs of production and encoragre farming
• implemented a minimum price, so effective it lead to over production
• ‘butter mountains’ and ‘wine lakes’

Question 4

give an example of an effective government compaign.

Answer 4

• THINK-highway code campaign
• encoraging road safety
• since the campaign began road accidents have fallen by 46%

Question 5

how and why did the price of pollution permits fall after the 2008 financial crisis?

Answer 5

• demand for permits fell and supply rose as production slowed
• this lead to the fall in the price of permits from 30 euros in 2008 to 2.75 euros in 2013

Question 6

how much have emmissions fell since the EU pollution permit scheme?

Answer 6

37% since 2005
- fallen less in energy intensive sectors such as steel production as they have been given free permits

Question 7

what was the recent increase in the living wage?

Answer 7

• £10.42
• £11.44

Question 8

what proportion of their profits did shell invest into renewable energy in 2023?

Answer 8

6.3%

Question 9

what is the tobacco tax?

Answer 9

for a pack of 20
- 16.5% of the retail price
- additional £6.33 on top of the price

Question 10

what effect does tax have on the consumption of tobacco?

Answer 10

• evidence suggests that every 10% tax imposed on tobacco, adult comsumption falls by 4%

Question 11

give an example of a government campaign aimed at reducing consumption.

Answer 11

• governments 2023 smoke free campaign aimed at parents
• releases a campaign film with ‘David james’ (ex smoker and footballer) discussing the impacts of their parents smoking
• swap to stop scheme, aims to provide 1in 5 smokers with a vape

Question 12

how much did the government spend on covid related campaigns in 2020?

Answer 12

£184 million

Question 13

how much in free permits have been given to steel producers by the EU emmisions scheme.

Answer 13

Between 2008 and 2019, about 2.3 billion emission allowances were issued to the steel sector for free

Question 14

what did the UK govt estimate is the positive externality of education?

Answer 14

recent estimates suggest that for every additional year of education is associated with an 18-35% rise in GDP per capita

Question 15

what was the estimated effect of an increase in the minimum wage on automatable jobs? what is the source of this information?

Answer 15

• the UK labour force survey
• the labour force survery estimated that a £1 increase in the minimum wage lead to a 0.58% decline in automatable jobs

Question 16

what % of survey respondants in child care said that an increase in the minimum wage had pushed them to increases prices? what is the source of this information?

Answer 16

• 80% said they will push up fees in response to the rises in the national minimum wage
• national day nursery association

Question 17

in the hotel and leasure industry what % of respondents said a minimum wage had lead to a large reduction in profits? what is the source of this information?

Answer 17

• 38%
• low pay comission report 2019

Question 18

What is the impact of the minimum wage on employment patterns? what is the source of this information?

Answer 18

• 2019 low pay commision report
• 46% reported that they opted to not replace leavers
• 39% said they increased the use of variable hour contracts

Question 19

what is the effect of the minimum wage on productivity? what is the source of this information?

Answer 19

• 70% said they saw no change in productivity
• 2019 low pay commision report

Question 20

how has the minimum wage affected nursuries?

Answer 20

• the recent rise in the minimum wage is estimated to result in 83% of nursuries making a loss or only breaking even
• estimated that almost 1/4 of childminders are likely to close in the next year