Group 3 - Individuals and societies. Offered at HL and SL
Much of the world has experienced in recent years the most turbulent economic times since the 1930’s. With this, there has been a resurgence in interest in the so called ‘dismal science’ of economics as we try to understand how we can return to the comfortable predictability of the economic cycle with its booms and busts. Meanwhile, an increasingly global perspective has focused our minds on how best we can promote development and manage world trade. Also, the environmental agenda has required stakeholders to consider the external impacts of economic activity in order to promote sustainability.
Economics is at the heart of these and many other key issues facing society. There has therefore never been a better time to study it.
Economics is a dynamic social science, essentially about the concept of scarcity and the problem of resource allocation. It involves the use of theory to explain the decisions and incentives of people, firms and government. Economics involves elements of history, geography, psychology, sociology, politics and environmental science as examples. For some students, it is the subject which joins up these different disciplines.
At IB, Economics consists of 4 key topics:
Microeconomics: how markets operate to allocate resources, how governments intervene and how firms behave in different market structures. For example, should smoking in public parks be prohibited?
Macroeconomics: economy wide issues such as economic growth, inflation, unemployment and how governments can intervene in the management of the economy to improve standards of living. For example, should government borrow more to invest in university education?
International economics: the importance of regional and global trade in relation to macroeconomic performance and how governments and global organisations seek to influence trade. For example, should the EU impose a tariff on Chinese steel exports?
Development economics: the reasons behind the disparity of economic development and the study of strategies to promote development with links to trade, micro and macroeconomics. For example, should the developed world reduce food aid to sub-Saharan Africa to promote agricultural output?
As an economist, you will be studying the world around you in the context of the behaviour of people, firms and governments. You will learn to use evidence to make judgements about which action is most likely to lead to what outcome in an uncertain world.
This combination of study of the real world we live in and analytical and evaluative skills are highly valued in a wide range of university contexts, not least business and economics, as well as by employers in many industries.
IB Economics Subject Briefs Higher Level and Standard Level