Tuesday, 30 October 2012

The Rise of Brazil

by Viva Avasthi

1. Why has Brazil experienced such rapid economic growth?

brazil, brazil flag
The graph below (despite its confusing title) shows the real GDP growth of Brazil compared to the US and UK.

To see how Brazil compares to other countries, click the words 'Explore data' on the bottom right of the graph.

Through its combination of a young population, plenty of natural resources and a fairly robust political system, Brazil has managed to create and sustain a boost in its economic state. The rise of China (which will be explored later in the series, but has been already been explained by our author Chris Pearson here) contributed to Brazil's economic development as China had, and still has, a massive demand for commodities due to its sudden surge in manufacturing. (For a simple and effective explanation of what commodities are, click here.) Brazil's massive levels of exports of commodities to China leaves it slightly vulnerable as China's economic condition has a direct impact on Brazil's economy.

During the first decade after the Cold War, America's relations with Brazil drastically declined, which marked the beginning of the end of the US' influence over Latin America. This resulted in Brazil having more independence in its political and economic actions, which allowed it to expand without the somewhat oppressive and exploitative US hindering its progress.

Aside from its commodities exports, Brazil has a fairly well developed high-tech industry. Brazil has clearly made use of the resources it has, but it could be argued that it is overly dependent on exporting commodities. However, notable examples of other areas where Brazil does very well globally are ethanol production and the aviation industry.

Ethanol production

Brazil is the second largest producer of ethanol in the world after the United States. In 2010, Brazil produced 486,000 bbl/d of ethanol, up from 450,000bbl/d in 2009. A combination of high world sugar prices, a poor sugar cane harvest, and underinvestment caused a precipitous decline in ethanol production in 2011.
Source: http://www.eia.gov/cabs/brazil/Full.html, Last Updated: Feb. 28, 2012

How Will The Rise of the BRICS Affect Us?

by Viva Avasthi

On Saturday 27th October I attended a lecture on the rise of the BRICS (Brazil, Russia, India, China, South Africa) as part of the University of Cambridge's Festival of Ideas. 

The speakers were:

Jaideep Prabhu
Jaideep Prabhu
University of Cambridge
Judge Business School

Isabel Hilton

Martin Jacques
Martin Jacques
'When China Rules The World'
Michael Keith
Michael Keith
University of Oxford

 In this series of six articles...

I will be presenting the economic development of each country from the BRICS in detail by addressing the three questions posed below. In order to do this, I will use my research as well as the opinions of the aforementioned speakers.

  1. Why have the BRICS experienced such rapid economic growth?
  2. How has this affected us?
  3. How will this affect us?
The first article in the series is on Brazil, since it is the 'B' in 'BRICS'.
The final article will be an overview of how the BRICS have affected us and will affect us as a group of countries.

The graph below highlights the fact that there has most definitely been a rise of the BRICS. 

This graph measures the GDP based on the PPP (Purchasing Power Parity, which accounts for differences in spending power available through different currencies) of each country rather (than the more common) GDP based on current prices. 

I have included the data on the US, UK and Germany so that the BRICS can be compared to other non-BRICS countries. Please move your cursor over the graph to see the various statistics.

Monday, 29 October 2012

Thought for the Week (29/10/12)

by Shireen Avasthi

Life is like a sewer. What you get out of it depends on what you put into it. --Tom Lehrer
What Lehrer means by this is that the more you put into something, the more you get out of it.

For example, the more you revise for an upcoming test, the higher you will score on it. Or the harder you work on an essay or article, the better it will turn out.

You shouldn't expect to do well at anything you don't put hard work into, because no one gets anything they don't deserve. You should also never stop working for what you want, because even if it may not seem like it at the time, you will eventually get everything you've earned.

Think of it as an equation; everything on the left of the equals sign is worth the same as everything on the right. When you change the value of the things on the left, you have to change the value of the right, and vice versa.

Put more into everything you do this week, and you'll find you're getting more out of it too :)

Saturday, 27 October 2012

The Legend of Apple

by Shireen Avasthi

apple, steve jobs, apple logo, teen economist, teenage economistWhy is Apple so popular? There are so many companies out there that sell products many people consider to be better than Apple's, not to mention much more affordable. What is it that attracts people so much that they end up buying such ridiculously priced merchandise? In this article I will be exploring what makes Apple popular and what makes them currently the most valued company in the world.

Wednesday, 24 October 2012

Made In Britain: Book Review (Part 2)

by Viva Avasthi

Last time, we left 'Made in Britain' halfway through, with a detailed analysis of the first and second parts of the book. In this article, Part 3: Intellectual Property will be explored. Part 4: Services will be reviewed in the final of this series of  three articles.

evan davis, made in britain, economics for teensintellectual property, teen economist, economics for teens

To allow this review to make better sense, I think it is best to mention what intellectual property is. Intellectual property is a term categorising the ideas that are created by our minds and have some commercial value. Examples of intellectual property include films and music as well novels, architectural designs and scientific inventions. Developed countries tend to have a 'Harry Potter economy' which means that the creativity and originality of the comparatively well-educated public is used to create intellectual property, which helps the nation generate its income (as opposed to manufacturing which can be done by fairly basic economies).  That's not to say that manufacturing ceases to remain important, of course. In this section, Davis mentions that some forms of intellectual property effectively combine with manufacturing in the UK.

Tuesday, 23 October 2012

Clever Scheme or Immoral Scam?

by Karina Shooter
 Ironic? Jimmy Carr has already been in the media spotlight for his UK tax avoidance schemes, now Starbucks is following in his footsteps… Photo courtesy of London 24

Amazon, Facebook, Google, Starbucks, Ikea and eBay – just some of the major corporations who have been in the news recently because of their UK tax avoidance schemes. Although their clever tricks and cover-ups are absolutely legal, we are left wondering whether their actions are morally questionable. 

The Facts and Figures
  • Over the past three years Amazon has generated more than £7.6bn of sales in the UK but has paid no corporation tax on the profits of these sales.
  • Facebook paid only £238,000 in tax last year in the UK despite making an estimated £175m in sales. 
  • It has been revealed that, despite earnings of £3bn in sales since 1998, Starbucks has only paid £8.6m in UK tax in the last 12 years. Last year it generated £398m in UK sales but paid no corporation tax.
  • EBay’s UK division has paid just over £1 million of corporation tax, despite generating sales of almost £800 million in the UK.

Monday, 22 October 2012

New 'Future Articles' Feature

letter, the teen economists, teen economist, teenage economist, economics for teens

Thought for the Week (22/10/12)

by Shireen Avasthi
I'm a great believer in luck, and I find the harder I work, the more I have of it.
 What Jefferson means by this is that 'luck' comes to those who work for it.

People who sit around not working for anything, just hoping they'll get 'lucky' and things will go well for them aren't 'lucky'; they're lazy. People who are truly lucky are those who create their own luck.

'Lucky' people work hard. This is why they are better off than many other people. To the rest of the world it may seem that people like this are insanely 'lucky', but in fact, they have just worked hard enough to create an amazing life that is full of great opportunities.

If 'luck' does in fact exist, it is most definitely attracted to those who work for it and earn it. Have you noticed that the 'luckiest' people you know are those that work for what they want? Maybe you are extremely 'lucky'. If so, this is only because you work hard, and the moment you stop working, your so-called 'luck' will vanish into thin air. The least 'lucky' people in your social circle are the ones who never put effort into the things they do. If you take some time to think this through, I'm sure you'll find that this is all true.

So work a bit harder this week. Put more effort into everything you do. You'll soon find that 'luck' is flying your way ;)

Sunday, 7 October 2012

Some Thoughts On...'Soaps'

by Karen Birnie

soaps, soap opera, television, economics for teens, economics for teenagers, teenage economist, teen economist
What is it about soap operas
 that makes them so addictive to the masses?
For the sake of this argument, let's say that you are taking the bus home. In front of you are two women, who are talking quite loudly, and you happen to hear snippets of their conversation. 'Did you see 'Enders last night?' 'Oh yes,' comes the reply, 'did you see what Stacey did? I can't believe she'd dare to...' and so the conversation falls prey to the winding plot of none other than the soap opera. I know that I find myself in similar situations frequently, and for this reason it seems the 'soap' is an integral part of society.

The soap opera - a staple, it seems, in the TV timetables, where millions sit down and spend the next thirty minutes transfixed, immersed in the dramas of Coronation Street or the Queen Vic. Where does the appeal lie? Few genres of television show have such a following. One reason could be that the protagonists are 'real life' people, that the every day working person can relate to. They are not extraordinarily clever, rich, or beautiful, they are not perfect; for the most part they are like us. This makes them easy to relate to and empathise with, and despite not existing outside of the show, the characters compel us to learn their story.