Hi ACJC 1ECX05 and 1ECX09 students,
The purpose of the WebQuest is for you to:
1. Identify examples of positive and negative externalities (eg: health care, education, road pricing).
2. Identify that externality is one source of market failure.
3. Illustrate how externalities lead to inefficiencies in resource allocation in the form of over or under production/consumption.
4. Apply these concepts to assess current Singapore government policies on production and consumption of various goods and services.
Please read your the other 5 group projects from your class. Consider these questions:
1. Has the group managed to meet the above objectives in their report?
2. Do you agree with their report? What are the unclear areas in their report?
3. What are some other points that you can add to their report?
Make at least 2 individual comments in response to the other groups' reports on their selected government policies. Remember to include your name in your comments, otherwise I won't know that you posted!
The deadline is Tuesday, 7 August 2007.
Click on the respective link to the reports by your class:
- 1ECX05 (1SC5)
- 1ECX09 (1SC4/6)
Cheers!
Mr Mervyn Sek
ACJC Economics Department
Wednesday, August 1, 2007
The Economics of Fashion
A Special Report by Michelle Law
Fashion goods are luxury goods which are generally consumed by people with a certain level of income. It has a low degree of necessity therefore they have relatively high price elastic demand which indicates the responsiveness of the consumers. Furthermore, they are heavily dependant on individual’s taste and preferences as fashion is very subjective as not all designs and cuts would suit a person’s likes or preferences and needs. Also, they are many different types of fashion which cater to different needs such as Haute Couture, Ready to Wear and mass produced lines.
The demand for fashion depends heavily on income and the needs of its consumers. When income increases, consumers have more purchasing power and might chose to upgrade the standard of the good they are currently consuming, for example buying a branded ready-to-wear instead of a piece from a mass produced line. This would cause a change in demand for each type of fashion, a fall in mass produced lines but an increase in ready-to-wear.
Moreover, fashion is generally implied to be related with clothing but unlike clothing, consumers pay for the design and the workmanship involved in producing the good. Thus, clothing would be considered as an inferior good because more people would chose not to buy it when their income increases. In contrast to fashion, clothing would be a necessity as it protects the body from harsh weather and safety reasons.
Alternatively, in fashion, there is limited supply such as in haute couture where such fashion houses produce a limited amount of designs which are handmade as it made to order for a specific customer, and it is usually made from high-quality, expensive fabric and sewn with extreme attention to detail and finish, often using time-consuming, hand-executed techniques. This creates a brand identity and exclusiveness for its customers and maintains the demand for the luxury good which in effect indirectly discriminates consumers as more purchasing power the individual has, the more choices and ability to purchase the good he/she wants.
Current trends and fads in fashion play an extremely important role in the demand of the good as it can influence consumer’s choice. The media coverage today is an extremely influential tool, especially the existence of fashion magazines and editorial critiques on the internet as well as published works. It can sway and steer the course of fashion trends in the world today by advertising certain brands or designs which would affect consumer’s decisions or at the very least form some impact on its audience. Even celebrities who are gaining increasing attention from the public can persuade to consumers and start a new fashion trend thus affecting the demand of the goods.
Fashion goods are luxury goods which are generally consumed by people with a certain level of income. It has a low degree of necessity therefore they have relatively high price elastic demand which indicates the responsiveness of the consumers. Furthermore, they are heavily dependant on individual’s taste and preferences as fashion is very subjective as not all designs and cuts would suit a person’s likes or preferences and needs. Also, they are many different types of fashion which cater to different needs such as Haute Couture, Ready to Wear and mass produced lines.
The demand for fashion depends heavily on income and the needs of its consumers. When income increases, consumers have more purchasing power and might chose to upgrade the standard of the good they are currently consuming, for example buying a branded ready-to-wear instead of a piece from a mass produced line. This would cause a change in demand for each type of fashion, a fall in mass produced lines but an increase in ready-to-wear.
Moreover, fashion is generally implied to be related with clothing but unlike clothing, consumers pay for the design and the workmanship involved in producing the good. Thus, clothing would be considered as an inferior good because more people would chose not to buy it when their income increases. In contrast to fashion, clothing would be a necessity as it protects the body from harsh weather and safety reasons.
Alternatively, in fashion, there is limited supply such as in haute couture where such fashion houses produce a limited amount of designs which are handmade as it made to order for a specific customer, and it is usually made from high-quality, expensive fabric and sewn with extreme attention to detail and finish, often using time-consuming, hand-executed techniques. This creates a brand identity and exclusiveness for its customers and maintains the demand for the luxury good which in effect indirectly discriminates consumers as more purchasing power the individual has, the more choices and ability to purchase the good he/she wants.
Current trends and fads in fashion play an extremely important role in the demand of the good as it can influence consumer’s choice. The media coverage today is an extremely influential tool, especially the existence of fashion magazines and editorial critiques on the internet as well as published works. It can sway and steer the course of fashion trends in the world today by advertising certain brands or designs which would affect consumer’s decisions or at the very least form some impact on its audience. Even celebrities who are gaining increasing attention from the public can persuade to consumers and start a new fashion trend thus affecting the demand of the goods.
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