Feb 12 2010

Advice for an aspiring IB Economics Extended Essay author

Published by at 8:52 pm under China,IB Economics,Trade

It’s that time of the year for IB Economics students all over the world. Time to choose their extended essay topics! The International Baccalaureate (IB) program is a rigorous, two-year diploma program for 11th and 12th graders. In addition two three “higher level” courses and three “standard level” courses chosen from each of the six subject areas (maths, physical sciences, social sciences, fine arts, language A and language B), students must also complete a major research project over the two year program. This “extended essay” is externally assessed and counts towards their points and their final diploma score.

As an IB Economics teacher, it is my duty to assist students who choose to write an economics extended essay. This year I will supervise four Zurich International School students, who will be researching topics ranging from the competitive nature of the local fast food market, to Malaysia’s economic policy and the country’s development, to the health insurance industry in Switzerland and Brazil’s coffee market. Helping students fine tune their research topics and refine their essay is an exciting and rewarding process.

This afternoon I received an email from an IB Economics student in Berlin. Here’s what she had to say:

Dear Mr.Welker :

I’m currently an IB Grade 11 student studying at Berlin International School, and i would like to write my extended essay in Economics. Your blog has provided me with so many ideas now that the problems is now i don’t know what to choose or how to narrow it down . My ideas are mainly focusing on China’s economy, because I’m from Taiwan, I thought it would be an advantage for me, since i can understand information if it was written in Chinese.

I’m thinking of writing about the following topics:

  • Limiting factors of China’s economic expansion (inequality, inflation, protectionism from other countries like US, spending and saving habits of the Chinese, export and import) and maybe the possible future of China’s economy, because while some people say it’s going to help lift the global economy out of recession, some say they see an economic crash.( but I’m not sure if as a high school student is able to do that, at the same time I think one of the criterias is to discover something new ? )
  • Another thing i also find interesting is about Chinese currency and how it might solve inflation (I came across this from one of your blog posts about China at May 2008) or what policies do governments use to maintain RMB without buying US exports and the possible effects on other countries as a result of weak Chinese currency

I really can’t decide which one to do, therefore i would really appreciate it if you could advice me and give me some feedbacks. 🙂

Looking forward to your responses !

I was happy to receive an email from such an enthusiastic young economist. Below is my response and advice to the student:


Your ideas are very interesting… it’s impressive as an IB Econ teacher to see a student as thoughtful and reflective on the EE topic as you are. Here are my thoughts on your proposed topics:

I think your first topic would be particularly difficult to research and write a good essay on. In all honesty, not many of the factors that you identify (inequality, inflation, protectionism from other countries like US, spending and saving habits of the Chinese, export and import) have really limited China’s economic growth. China’s growth has been unprecedented in the world in modern history. Inequality could be viewed as a result of the rapid growth the country has experienced; such inequality has been experienced in many countries during their early stages of economic development. Inflation is also a symptom of rapid growth, but in most cases China has keep inflation under control. It has been the lack of protectionism from countries like the US which have led to the massive growth of China’s export industry. If anything, China’s own protectionist policy of managing the value of the RMB at such a low rate has also contributed to its rapid growth.

Even Chinese spending and savings habits have contributed to the growth of the country’s economy. A high savings rate enables the Chinese government to tap the country’s savings to buy US government bonds, which keeps interest rates low in America, the dollar strong, and helps finance the US government’s budget deficits, meaning lower taxes and more disposable income among American consumers who turn around and import hundreds of billions of dollars worth of Chinese goods every year, further fueling growth in China. With a lower savings rate, China would experience fewer net exports. On the other hand, they’d experience more domestic consumption, which is probably what we should expect to see in the future if Beijing begins to loosens its control of the RMB and allows it to strengthen. Chinese will then begin consuming more of their own output and buying more imports from abroad, while net exports decrease in response to the rising prices of Chinese goods in the west. Domestic consumption will begin to replace exports as domestic savings decreases.

I like your second proposal much better. Since you are in Germany, I would consider researching the effects of China’s exchange rate controls on a particular industry in which both German and Chinese firms compete. I had a student in Shanghai who had a similar background to yours; he was of Chinese descent, but born in Germany. He spoke both German and Mandarin. He researched the impact of China’s low cost automobile parts manufacturers on the German auto parts and automobile industries. He did not focus exclusively on the exchange rate, but it was part of his research.

The IB really likes when you research local markets. If you examine the impact of the weak RMB on, say, US net exports, it’s not nearly as impressive as if you focus your investigation on German firms. You may have friends at your school whose parents work for firms who do business with or compete against Chinese firms. Interview them! You could measure historical exchange rate data between the RMB and the Euro, explain the mechanism by which China manages its currency against the US dollar but then explain how that also affects exchange rates with the Euro, then examine the impact on exports and imports from Germany to China and vis versa in response to the fluctuations of the RMB/Euro exchange rate. America is not the only country that wants China to let the RMB float. Europe’s exports are also affected by the weak RMB.

So that’s my suggestion. Take your two homes (well, not really as you’re Taiwanese, but close enough!) and focus on them. Choose one or two industries that exist in Germany AND China, and research the effects of free trade, China’s entry to the WTO, China’s exchange rate policies, and so on, to draw conclusions about how China’s entry to the global economy has affected firms in Germany.

Good luck, I hope this helps! Click on the “China” category on my blog to find all the dozens of articles I’ve written about China over the last three years!

Mr Welker

About the author:  Jason Welker teaches International Baccalaureate and Advanced Placement Economics at Zurich International School in Switzerland. In addition to publishing various online resources for economics students and teachers, Jason developed the online version of the Economics course for the IB and is has authored two Economics textbooks: Pearson Baccalaureate’s Economics for the IB Diploma and REA’s AP Macroeconomics Crash Course. Jason is a native of the Pacific Northwest of the United States, and is a passionate adventurer, who considers himself a skier / mountain biker who teaches Economics in his free time. He and his wife keep a ski chalet in the mountains of Northern Idaho, which now that they live in the Swiss Alps gets far too little use. Read more posts by this author

32 responses so far

32 Responses to “Advice for an aspiring IB Economics Extended Essay author”

  1. cushionon 14 Feb 2010 at 7:33 am

    brilliant blog! I also love to write about economics, please visit my blog http://www.windowsillseat.blogspot.com and follow me 🙂

  2. Eymaon 30 May 2011 at 6:33 am

    Hi Mr.Walker, I'm a Malaysian student,and I'm doing EE for Economics. I have a big problem now. Can I ask for your opinion please?

  3. Eymaon 30 May 2011 at 6:35 am

    I'm sorry for the wrong spelling of your name above, Mr. Welker!

  4. Sohamon 25 Jul 2011 at 7:26 pm

    Hi, i'm an Economics high level student at Atlanta International School. My extended essay topic is: Impacts of Microfinance loans in Howrah, West-Bengal. I have visited the village, Howrah – and gathered information about the progress of micro-finance in the local area. But i'm finding it a bit hard to structure the content of my essay. Do you think its a good topic? Opinions would be helpful! Thanks.

  5. shwetaon 30 Jul 2011 at 12:04 pm

    Hi my ee topic is privatistion of PLN (the only electicity provider in Indonesia) will be useful to purvakarta region> Is this a BM topic > can I continue

  6. Extended Essay for IB Economicson 23 Aug 2011 at 8:03 am

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  7. vb1on 21 Dec 2011 at 5:56 pm

    Mr. Welker can you help me out. I am stuck in selecting as topic for my economics investigation? I am from India

  8. Adibon 17 Jan 2012 at 1:42 pm

    I am first a first year student and this is my second sem.Now we have been given this EE task. If i am going to write EE in Economic now, does my essay content is only limited to what topics that i have learnt?

  9. Kareenaon 31 Jan 2012 at 11:16 am

    hi, i'm an IB student in standard 11, and i'm very confused of which topic to choose for my extended essay. i'm thinking of doing on either the competition of blackberry and iphone or the export and import of blackberry or also the demand and supply of blackberry. is there a better suggestion?

  10. aadyaon 07 Feb 2012 at 7:18 am

    hey i am an IB student grade 11 and am extremely confused about my extended essay economics topic… time is running and any suggestions would be valuable

  11. welkerjasonon 07 Feb 2012 at 1:54 pm

    Hi aady,
    Don't you have an extended essay supervisor or an economics teacher who can assist you? If not, you should speak to your school's IB coordinator and see if he/she can offer you assistance on choice of topic.
    Best of luck.

  12. Maya Tameron 06 Mar 2012 at 9:26 am

    Hello Mr Welker; your blog really encouraged me to do my extended essay in economics. I am currently in my first year of IB in the international school of Cologne in Germany. Previously I wanted to do my extended essay on the situation in syria as it is my home however collecting primary data became a challenge and so I had to change the topic. Now I am probably doing it on the effect of the world economic downturn on the shopping festival in Dubai as I lived there for 5 years and visit it annually. What do you think about this question because Im really motivated but I dont want to get into one topic again and then find out that it is not the ideal question. I would much appreciate any help you could give me.Thank you in advance. 🙂

  13. Adriannaon 13 Jun 2012 at 9:57 pm

    Hi Mr. Welker!, i was wondering for my EE in economics, which topic do you think is better? I really need help!
    1) Something about how does the fluctuations in the chinese managed currency affect the trade ( or on the chinese currency since i am currently situated there or speculation? )
    2) maybe on the price volatility of cocoa or something on fair trade of cocoa beans?

    As you can see I really have trouble on finding a specific topic! any suggestions??

  14. home tutoron 22 Sep 2012 at 9:13 am

    Great blog I also love to write about economics.

  15. Babul akhteron 23 Oct 2012 at 6:49 pm

    Hi Mr. Walker , I am a Bangladeshi student studying in International School Dhaka . I am a 12th Grade IB economics student . I am preparing an extended essay on RMG( Readymade Garments ) sector in Bangladesh. My question is : " Does labor cost effect on the export of RMG goods in Bangladesh" I am baffled what to write in this essay and how to present this essay nicely . Your valuable suggestion will help me to finish this research question early . I have to submit a draft of it by one week !

    Grade 12

  16. Jason Welkeron 24 Oct 2012 at 10:54 am

    Hello Babul,
    You should speak to your own Economics teacher or Extended Essay supervisor regarding your own EE topic. If you have not been assigned a supervisor, you should speak with your school's IB coordinator. Best of luck!

  17. Karishmaon 25 Oct 2012 at 8:17 am

    Hello Mr. Welker,

    I am doing my EE on the influence of appreciation of the Us dollar on consumption of luxury goods within the us.
    Is this a good topic? I'm not sure what kind of primary data i could collect. I really hope you have some suggestions sir.

  18. Simonon 02 Feb 2014 at 1:54 pm

    Dear Mr. Walker
    My name is Simon. Right now, i am going through my 1st year of IB and I really want to write my extended essay on Economics. The thing is that i am really worried because before I can start it, my supervisor has to approve it, but i wanted to get an approval or a hint if you would on my essay subject that i have throughout (kind of):

    Market Analysis on Bulgarian Transport Services. What difference do special ways of transport such as parcel delivery make for the consumer and Producer. ( I think of getting this as my essay subject because i have connections from which i can gain information about different firms and what kind of special ways of delivery they have and how much is the consumer satisfied, and to get further information, i will make a survey to ask customers and make a percentage chart to help me with the estimated percentage of satisfaction of consumers.

    I really hope you can answer my question because this is a really hard essay, because I've heard from different people that this essay is the thing that broke them down because they could not start it on time, so i really need a response so i can start and finish it as soon as possible and then give it out to my supervisor to examine before he sends it of to the IB.
    Thank you once again!

  19. Aaronaxelon 05 Apr 2014 at 9:03 am

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