Economic: Topic 11, Year 2 Definitions

Refers to the government's manipulation of its expenditure, taxation and the budget balance to manage the economy.

Describes spending by the government or its agencies on the provision of goods or services and spending on cash benefits.

Refers to the basic facilities available to society that support economic activity such as transport and communication links.

Takes a higher proportion of taxpayers' incomes as their incomes increase.

A payment that has to be made to the government or other authority by households, firms or other organisations.

Levied on income or wealth such as income tax.

Paid on spending by firms, households and other organisations.

Describes government policies to reduce expenditure and increase revenue from taxation during periods of budget deficits.

Sets out the characteristics of a fair taxation system.

A situation in which the revenue raised from a tax is ring-fenced for a specific purpose.

The trend for many markets to become worldwide in scope.

The difference between government spending and revenue over the financial year.

Exists when government spending during the financial year exceeds the revenue received from taxation.

Occurs when receipts from taxation exceed government expenditure over the financial year.

Arises because of a fundamental imbalance between government receipts and expenditures, rather than short-term factors associated with the economic cycle.

Elements of fiscal policy that occur independently as an economy moves through its economic cycle.

The total of all past government borrowing that has never been repaid.

Suggests that high levels of activity by the public sector can reduce the level of private sector activity.

Intended to increase an economy's productive potential by improving the efficiency with which markets operate.

The transfer of state-owned organisations to the private sector, where they are owned by individuals and private firms.

The reduction of the extent of state or government control over a business activity.

Measures the efficiency with which an economy uses its factors of production to produce goods and services.

Refers to government intervention that seeks to support or develop some industries to enhance economic growth.

Occurs when firms undertake projects that seek to achieve an advance in science or technology.

The process of turning an idea or invention into a saleable product or a more efficient method of production.

A series of government initiatives intended to raise employment and incomes in less prosperous parts of the UK.

The level of unemployment that exists when the labour market is in equilibrium.

Exists when workers are in the process of moving to a new job.

The loss of jobs resulting from the long-term decline of specific industries.

Exists when workers cannot transfer easily to employment in a different type of job.

Occurs when workers cannot move freely to take employment in a new location.