Economic literacy and society

There are two senses in which increasing economic literacy contributes greatly to the functioning of our society.

First, a free market economy works well only when the participants – producers, consumers, savers, investors – have the information they need to make intelligent decisions. People need to understand what banks do and how to deal with them; how insurance works and how to think about how much they need; why saving is important and what instruments are available for saving; what investing means, how to do it and what the risks are; and the concept of investing in themselves and how to get a good job. Most important, participants in the economy need to know how to think about the economic choices they face and how to get the information they need to make intelligent decisions.

Second, democracy works well only when citizens participate, vote and make their views known to public officials. In this respect, we seem to be living with a paradox. On the one hand, the revolution in communications means that citizens have access to far more information on public issues than ever before. Radio, television and the Internet are flooding all of us with news, analysis, opinions and debate on public issues, large and small. Citizens have more education and more ways of communicating their views to public officials than they had in the past. They can write, call, visit or e-mail their members of parliament or their local legislative representative.

On the other hand, public issues, especially economic issues, seem to have become more complex and harder to understand. Globalization and rapid advances in technology mean that events in remote parts of the world that we do not know much about can affect economic life in Russia, Great Britain or the United States, and vice versa. Markets in distant places are intimately interrelated; huge amounts of money move around the world in seconds. The interactions and interrelations of markets and economic institutions in different parts of the globe are complex and unpredictable.

Discussion

1. Say whether you agree or not with the following statement: “Economic literacy is akin to having a working knowledge of a foreign language”. Give reasons for your answer.

2. What kind of economic knowledge is most useful to Russian citizens as opposed to professional economists?

3. Define the spheres of our life where we can`t do without economic literacy.

4. Say what you think about the importance of economic literacy for policymakers. Are any economic literacy courses organized for the Russian Duma members?

5. Are there any specialized institutions that provide professional economic education in Russia and abroad? Use different sources of information.

Unit 5. Questions all economies face

Assignment 1. Remember the meaning of the following words and word- combinations:

to face

to attempt

to resolve

versus

unlimited wants

to manufacture

output

to distribute

to determine

mix

сталкиваться

пытаться, пробовать, делать попытку

решать; принимать решение

в сравнении с

неограниченные потребности

(желания)

производить, изготовлять

продукция; производство; объем производства; доход

распределять

определять, устанавливать

смешивание; путаница, беспорядок

consumption goods

investment goods

total output

particular

a powerful engine

gasoline

thrifty

consumption

petroleum reserves

intercity highway

to upgrade our rail system

to subsidize bus transportation

representative

allocative efficiency

input

marketplace

painful

regarding

exactly

to occur

labour cost

nonunion worker

often-abrupt

to stun

utter confusion

unemployed individuals

victim

previous employer

utilization

to schedule

shift

condition

conditions

товары широкого потребления; потребительские товары

инвестиционные товары; товары производственного назначения; средства производства

совокупный объем производства; совокупный доход

особый; конкретный

мощный двигатель

газолин; амер. бензин

экономный, бережливый

потребление, расход

запасы нефти

междугородная трасса

улучшить нашу железнодорожную систему

субсидировать автобусный транспорт

характерный, показательный

эффективность распределения (ресурсов); аллокационная эффективность

ввод; вводимый ресурс; фактор производства

рынок

болезненный; мучительный, тяжелый

относительно, о

точно; как раз; именно

происходить, случаться

заработная плата; затраты на рабочую силу

рабочий, не состоящий в профсоюзе

часто внезапный

ошеломлять

полное смятение

безработные люди

жертва

предыдущий работодатель

использование, применение

намечать, назначать; планировать

(рабочая) смена

условие

обстоятельства; обстановка

concern

around the clock

labourer

to seek

premium

recently

to boil down

measure

trade-off

leisure

percentage

to rear