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Macroeconomic Policies - Lesson Plan: 3 x 1 hour lessons

A series of 'off the shelf' lesson plans and resources for use in the classroom. These lessons deal with Macroeconomic Policies and are relevant to the following specifications:

• AQA: Module 2, sections 11.1, 11.2 and 11.3
• Edexcel: Unit 3
• OCR: Unit 2883, sections 5.3.1, 5.3.2 and 5.3.3.

Aim:

The aim of these lessons is to encourage students to take an overview of the main policy instruments used in macroeconomics and to use the tools of macroeconomic analysis to develop higher order skills.

There are a large number of concepts and skills that could be covered as part of the lessons and the success of the task may depend on how thoroughly students have covered the material when the lessons are introduced.

The Presentation that accompanies these lessons goes into some detail about the policies that can be used. Students should be encouraged to re-visit these slides on a regular basis if they need guides on the theory behind what they are doing. If used as part of the introduction to the topic, educators should note that there are 44 slides and as such it may be appropriate to 'dip' into the Presentation and select just those bits that you wish to focus on in that lesson. For example, if one lesson involves introducing monetary policy, slides 2 - 16 can be used and so on.

The latter part of the fiscal policy Presentation gives some facts and figures about current government income and expenditure. The aim here is to give students the opportunity of looking at the range of activities the government are involved in and where they get their revenue.

The note about 'subtleties' is intended to encourage students to move from a blanket 'increase/reduce taxes' approach to policy analysis, towards an appreciation that the actions of the government are not quite as straightforward and as such, affect different people in different ways and may also impact on the non-economic policies that are often ignored by students.

The task has been broken down into a series of stages to guide students in the development of their answer. The final point - writing a letter to a national newspaper - is designed to get students to write a short, coherent argument covering the key aspects they have been working on and justifying the outcomes they predict.

As an alternative, the class could set up a 'Paxman/Dimbleby/Humphrys' type interview scenario where one of the team is 'interviewed' about their policies. This can be extended to allow several people to be the interviewer and the interviewee! The remainder of the class can be invited to pose questions to the interviewee and the whole activity could be filmed and the result used as a discussion point as well as encouraging students to verbalise their understanding and thinking around issues. Such a strategy can add variation to lessons and provide those who enjoy active learning the opportunity of really getting involved.

The concept of trade-offs is given high priority in these lessons. The essential aim is to make students aware that no government can promise everything to everyone and deliver on all of its promises. The process of having to make priorities and justify those priorities is the vehicle through which higher order skills are encouraged.

Learning Objectives:

At the end of the lessons, students should be able to:

• Understand the main distinctions between the three key economic policies used by governments and their agents
• Use diagrams to help analyse the impact of policy options with greater confidence
• Understand the meaning of the term 'trade-off' and to be able to apply it to real life examples
• Appreciate the necessity of setting priorities and justifying such priorities
• Develop the key skills of analysis and evaluation

Resources:

• PowerPoint Presentation - Macroeconomic Policies [292K] (basic version also available for quicker download [107K])
• Mind Map - Macroeconomic Policies
• Activity - Macroeconomic Policies
• PC and projector to show the Presentation
• White board
• Video Camera (optional)

Lesson Structure:

Lesson 1

1. Review the key economic and non-economic targets of a government (the use of the Presentation Measures of Economic Performance is recommended here). (10 minutes)
2. Look at the Activity. Introduce the principle of a trade off - what do students think it means? (10 minutes)
3. Pair students off and ask them to draw up a list of priorities for the economic and non-economic targets discussed. Get them to feedback and to explain why they have decided on the priorities outlined. (10 minutes)
4. Bring the group into a discussion about the different perceptions of the priorities that will become apparent from the feedback. (10 minutes)
5. Ask students to suggest how one of their priorities could be solved - discuss the feedback and classify the suggestions into three categories - fiscal, monetary and supply side. (15 minutes)
6. Review learning outcomes of the lesson - priorities, trade-offs, policy options. (5 minutes)

Lesson 2

1. Review learning points from last lesson. (5 minutes)
2. Begin Presentation on macroeconomic policies - deal with each in turn to break up the length of the Presentation.
   
   Following explanation of each, refer back to the listed categories from lesson one of policy options for solving prioritised problems - expand on the impact of the solution and the potential consequences, thus reinforcing the idea of 'trade-offs'.
   
   Get students to try to internalise the information presented so far by asking them to draw diagrams as appropriate, illustrating the impact of their policy decision on the economy as a whole - stress the importance of getting them to consider the strength or significance of the impact. (45 minutes)
3. Flag up the main aim of the Activity that will be tackled in the next lesson. Explain how the task is going to be conducted (depending on whether the 'video' option is chosen). (10 minutes)

Lesson 3

1. Remind students about the Activity and the task they have to perform. Set a time scale on the task. (5 minutes)
2. The remainder of the timing depends on how the educator has decided to assess the feedback. If using the video option, then a further lesson may be needed. If using the task as a written piece, students could be asked to complete for homework or another lesson could be allocated to continue and finish the work. (55 minutes)