Developments in Economics &amp; Business Education 1-2 September 2005

1 / 12

Developments in Economics Business Education 1-2 September 2005 - PowerPoint PPT Presentation

Developments in Economics &amp; Business Education 1-2 September 2005. Using the Virtual Chancellor Simulation John Houston &amp; Anne Gasteen Economics’ Research Group, Caledonian Business School, Glasgow Caledonian University [email protected] [email protected]

I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.

PowerPoint Slideshow about 'Developments in Economics Business Education 1-2 September 2005' - moral

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.

- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript

Using the Virtual Chancellor Simulation

John Houston & Anne Gasteen

Economics’ Research Group, Caledonian Business School, Glasgow Caledonian University

Using the Virtual Chancellor Simulation

Context : Level Three Macro theory module (IS-LM-FE; DAD-SAS)

But can be used at almost any level (incl. School)

Web-based: http://www.virtual-worlds.biz/vwc/ (now reasonably reliable)

Parameterized for the UK Economy

‘Black Box’ but free to use

Quick Run [1]

1. Can change any combination of these four variables

2. Submit to the ‘Black Box’

…. or get back to the starting values

Quick Run [2]
• Increase basic rate of tax from 22% to 25%

Net weekly effect on sample households

Effect on key Macro aggregates

Full(er) Run [1]
• Can change:
• Income Tax, National Insurance & Spending Taxes
• Government Spending on : Defence, Education, Law & Order and Health
• Base Rate
Full(er) Run [2]

Appears only to affect macro aggregates, but not households

Full(er) Run [3]

Tabular & Graphical Output

Full(er) Run [4]

Analysis of effects on the sample households

Demo : 2005 Budget Measures

Personal Allowance = £4,895

Income Tax Basic Rate = 22%

Starting rate = 10%, Higher rate = 40%)

National Insurance = 11%

Between lower and upper earnings limits (£94 - £630 pw)

above upper earnings limit: 1%

VAT Standard Rate = 17.5%

Reduced Rate 5% (8% in model)

Demo : 2005 Budget Measures
• Govt spending:
• Public Order & Safety = £31bn => 82.35% increase
• Defence = £28bn => 6.67% reduction
• Health = £90bn => 20% increase
• Education = £68bn => 13.33% increase
• Basic Rate of Interest = 4.5% (reduction of 0.25%)
Our use of VC at GCU
• Three, one-hour supervised computer labs
• Introduce - ‘Quick Run’
• Altering Direct & Indirect Tax Rates/Allowances
• Altering Government Spending & Interest Rates
• Students attempt exercises throughout, considering the impact upon:
• Households (several representative types)
• Macroeconomic Aggregates
• Assessable Coursework
• Replicate, as far as possible, the most recent Budget & Autumn Statement
• Individually, or in teams, depending upon scope & abilities