How to evaluate in A-Level Economics

How to evaluate in A-Level Economics

10 min Read|February 06 2024

Discover tips and strategies for successfully evaluating economic theories and concepts in your A-Level exams. Learn how to analyze data, apply economic models and effectively communicate your ideas in your exam.

Over 35,000 students took A-Level Economics in 2022, but only 13.6% of these students achieved an A* grade. What separates these students from the rest is how they evaluate. This is the secret to getting those A* grades.

Economics A-Level grade allocation

Source

Evaluation is a critical aspect of A-Level Economics – it accounts for a significant portion of the marks and provides the examiner with a clear understanding of your perspective on a particular issue or debate. Any A* essay will have top-level evaluation and it’s the area which is most commonly overlooked by students. Don’t just focus on learning content and economic theories, you need to learn how to evaluate each point you make as well. So in this article, we deep dive into evaluation – what is it? How do you do it? When should you do it? Finally, one of our A-Level Economics tutors discusses how you can use an ‘evaluation bank’ in your revision to help you get those A* grades.

What is evaluation?

Evaluation is fundamentally about making a judgement. In A-Level Economics, you want to make a judgement on the point you have just made, to consider potential counter-arguments and use this to come to a reasoned conclusion. This is an important skill that not only demonstrates your understanding of economics but also showcases your ability to think critically and apply your knowledge to real-world scenarios.

Evaluation doesn’t only show that you can critically engage with the content, it is also explicitly part of the mark scheme. For example, in the Edexcel A exam, 20 mark questions have the following structure:

20 mark question structure

As you can see, you receive up to 6 marks out of 20 for evaluation, with the remaining 14 marks coming from Knowledge (K), Application (A), Analysis (A). So even if you achieve full marks in KAA, if you don’t evaluate you’ll only get 14/20.

In order to achieve an A* grade in A-Level Economics, it is crucial to be able to effectively evaluate economic policies, theories and concepts. Evaluation is not only about stating whether something is good or bad, but it is about considering the strengths and weaknesses of different approaches, and making an informed judgement on their effectiveness. The purpose of evaluation is to assess the impact of economic policies and theories on society, the economy, and individuals, and to determine whether they have met their objectives.

How to evaluate?

Evaluation is usually a combination of ‘it depends on…’ and ‘however…’ points. In this section, we go through some key questions to ask yourself when you evaluate, with an example for each.

Time

Consider whether there is a difference in the short run and the long run. Why and how might it change?

Example

If you are discussing supply-side policies to boost growth, such as education, training and investment in research and development, a good evaluation point would be to discuss the fact that these policies may take a long time to have an effect. Greater investment in education today may not have an effect on the labour force for years depending on whether the policy is directed at the primary, secondary or higher education level.

Who?

Who does the policy affect? Are there different impacts on different groups of people? Are there winners and losers?

Example

Suppose you are answering a question about whether a particular country benefits from international trade. You want to evaluate by discussing the differential effects on different people. There are winners and losers from international trade. High skilled individuals may benefit since their skills are demanded globally, but low skilled/low paid workers may lose out from international trade since there is a large supply and if wages are lower in foreign countries then there may be structural unemployment in the home country. Trade also has differential impacts on men and women, partly because they may be in different sectors. For instance the decline of the manufacturing sector in the US may have a greater impact on men since these tend to be male-dominated sectors.

This academic blog has a great discussion of the winners and losers of trade and how policies can be evaluated, in some areas it is quite complex and there is no need to understand it all, but it may be a good starting point for a few ideas.

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Magnitude

Will the effect be large or small? Why?

Example

Suppose you are talking about the effects of quantitative easing (QE) on the economy. You may suggest that this will increase inflation since it is increasing the money supply. However, a good evaluation point would be to discuss the size of this effect – is the increase in inflation going to be large or small?

Since QE was used when the economy was very deep in a recession, the economy was a long way from full output, this means that AD can be increased without a significant impact on inflation.

effects of quantitative easing(QE) on the economy

It depends on…

What other factors do you need to consider before making your decision?

Example

Suppose you are talking about the effects of the government reducing income tax during a recession to boost spending. Your initial chain of reasoning may discuss how reducing income tax gives consumers more disposable income which should lead to an increase in consumption and an increase in AD. Your evaluation point may be to discuss what other factors you need to consider. For example, which consumers are receiving a tax cut? If it is low income earners, they may have a larger marginal propensity to consume and therefore they are more likely to spend their money rather than save it, whereas if it is higher income earners they may save their money so the multiplier effect may be less in this case.

Costs

You also need to consider the costs (both opportunity cost and actual cost) of the decision or factor. This can either be a strength or a weakness of a particular point of view.

Example

Investing in new renewable energy sources such as wind, solar and nuclear power may be beneficial in the long-run, particularly from a sustainability perspective. But the costs in the short-run are very high. So this needs to be considered against other competing goals such as healthcare and education spending.

Equality

Are there different impacts on different groups of people? Could the policy be regressive and increase inequality of wealth, income, gender, race, for instance?

Example

There are often questions in A-Level Economics about indirect taxes on demerit goods (eg. sugar, alcohol, tobacco). One good evaluation point for this is to discuss that this tax may be regressive. A regressive tax is not adjusted by income, so this means that someone who buys cigarettes is taxed the same amount regardless of whether they have very high income or have very low income. This means that the tax takes a larger proportion of the poorer person’s income, and so it is regressive. Another important consideration is that individuals from lower-income backgrounds may be more likely to consume demerit goods such as alcohol, tobacco and sugar. Increasing indirect tax on these goods may therefore be regressive and conflict with equality objectives.

Balance

Discuss the relative strength of arguments on each side of the debate. Include both empirical evidence (either from the extracts provided or your own knowledge) and theoretical considerations. Come to a judgement, what do you actually think?

Example

The example above discusses the regressive nature of some indirect taxes which do not vary by income. Once you have made this evaluation point, you need to weigh it up against other reasons in favour of indirect taxes on demerit goods, such as the benefits of reducing consumption. So you need to come to a judgement. Does the regressive nature of these taxes mean that we should not tax demerit goods? Or does it mean that we should use indirect taxes as part of a broader tax and benefit system in which we seek to reduce income inequality whilst still targeting demerit goods?

Elasticity

How could elasticity affect the outcome (PED, YED, XED, PES)?

Example

Whenever you have a question asking about the effect of an indirect tax on a good (such as sugar, tobacco, alcohol, carbon) an evaluation point you can always use is that it depends on the elasticity. If demand for the good is inelastic, then the tax will not cause a significant change in quantity demanded. This means the consumer will bear a lot of incidence of the tax as the producer will pass the tax on to them, and also means that the government will raise a lot of revenue. We can also show this on a diagram:

Comparison of inelastic and elastic demand

Source

Learning this A* evaluation point and the diagrams in advance means that you can add it into almost all indirect tax essays, and you will save yourself a lot of time in the exam.

Assumptions

Have you made any assumptions in your theory? How could these be challenged? How does it affect the outcome if they are?

Example

When you are discussing the effects of an indirect tax on tobacco, you may assume that there are no unintended consequences. However, if we relax this assumption then we may consider unintended consequences of the policy such as an increase in illegal cigarette smuggling, or an increase in harmful alternatives such as unregulated e-cigarettes.

Reliability

Is the data reliable? Look at the source?

Example

A lot of data is difficult to collect. For example, it is very difficult for governments to measure the negative externalities associated with particular actions. For example, how does the government measure the effects of excessive alcohol consumption on mental health, or measure the lost work hours of someone being hungover. These methodological challenges can make it difficult to collect accurate data on this. However, this does not mean that the data should just be disregarded, we need to accept some margin of error in most data we use, but it does mean that we should be aware of and critically engage with the methodological approach taken to collecting this data.

Sustainability

What if we consider this policy or factor from a sustainability perspective?

Example

Suppose a question is talking about the merits of opening a new petrol car plant in the UK. You may have discussed the effects on employment, the balance of trade etc. But you may also want to consider the effects on sustainability. Petrol cars may conflict with the government’s commitments to a greener economy, so this link with environmental sustainability. But also consider the sustainability of the business itself, will petrol cars still be a viable market in 20 years time? Would the UK be better off opening a new electric car plant?

How can I remember these evaluation points?

Use a mnemonic

For some students, it may help to remember some of these evaluation questions as a mnemonic eg. TWO MICE BEARS (Time, Who, Objectives, Magnitude…). Then if you are struggling for evaluation points then you run through this mnemonic and its likely a few of them will apply to the question you are looking at. In this way, learning to evaluate is a skill, and once you have practised it, you are able to spot evaluation opportunities everywhere. Hopefully this article has given you some direction of where to start.

Make an evaluation bank

One of our top tips is making an evaluation bank. When you revise A-Level Economics you will spend time learning definitions and formulas, so why not apply this to evaluation as well. Since it gets you so many marks in the exam, it is surprising how few students do this.

You can create a bank with diagrams, key points and statistics that you can use whenever a relevant question comes up. For example:

  • Elasticity is an important consideration for indirect taxes → put this with the diagram in your bank
  • Indirect taxes may be regressive → perhaps find some statistics on the extent to which they are

Using this bank and learning some key pieces of evaluation can make things much easier in the exam, as you aren’t havent to evaluate from scratch, but already have some ideas to draw on.

When to evaluate?

Evaluation often follows a chain of reasoning. For example, you may have explained how supply-side policies may reduce unemployment, and you then evaluate this argument. What does this policy depend on? Will it affect some people more than others? Are we making certain assumptions in this chain of reasoning? Will this have different effects in the short-run and long-run?

You should also evaluate a lot in your conclusion. This is where you bring the argument together, weigh up different points of view, and come to an overall conclusion.

Final thoughts

Evaluation is a critical component of A-Level Economics but it also the part that most students struggle with the most. It is essential to master this skill in order to achieve an A* grade and this guide should give you a great starting point and some key examples.

If you want to dive into evaluation in even more detail with one of our expert A-Level tutors, get in touch with TutorChase today.

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Megan Isaac

Written by: Megan Isaac

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Oxford University - BA Politics, Philosophy, and Economics

Megan recently graduated from Oxford University, achieving a first class degree in PPE. She has has six years of tutoring experience, teaching a range of subjects at GCSE and A-Level, as well as helping students with their applications to university including Oxbridge.

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