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Adam Smith: what does his work mean to economists today?

topical issues

Smog and biscuits

What’s the link?

Peter Smith looks at the link between biscuits and the problem of smog, and shows how economic analysis can be applied to recommend solutions. However, in some situations good solutions to economic problems may not be implemented because of political reality

REX/ZUMA

In June 2013, the BBC reported on the problems in Singapore that were caused by the smog that had engulfed the city-state. Parts of neighbouring Malaysia were also badly affected, leading to serious concerns about damage to people’s health. Levels of pollution reached record levels, several schools were closed and Cardiff City (recently promoted to the Premiership) cancelled a visit intended to raise the profile of the football club. Singaporean residents were advised by the prime minister to ‘stay indoors wherever possible and avoid heavy outdoor activities’.

Palm oil is an ingredient in a wide range of products, including some biscuits, chocolate bars, pizzas, margarine, ice cream and many more. Indonesia is one of the largest producers of palm oil worldwide and an increasing amount of land is being devoted to its production. In Sumatra — a large island adjacent to Singapore and southern Malaysia — rainforest is being cleared in order to expand the acreage used for palm oil.

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Unemployment

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Adam Smith: what does his work mean to economists today?

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