Cambridge. Economics Tripos, 1933

 

Examination questions for the Cambridge Economics Tripos from 1921, 1931 and 1932 have been posted earlier. Today we add the 1933 Economics Tripos for good measure.

Economics Tripos Part I (1933)

General Principles I
Social Problems
General Principles II
Essay Subjects
English Economic History
Economic Structure

Economics Tripos Part II (1933)

Economic Principles
Industry
Money
Essay Subjects
Labour
Principles of Politics
Public Finance
The Economic Development of the United States
Statistics
International Law

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PART I.

Monday, May 29, 1933.  9—12.
GENERAL PRINCIPLES I.

1. “Economics may be described as a scientific study of the best means of avoiding waste.” Discuss.
2. “Value in all cases tends to equal cost.” Consider the most important ways in which this dictum requires modification or amplification, and bring out clearly what is meant by “cost.”
3. Is it possible for a community to save and invest too much for its own welfare?
4. “Since it is evident that any industry is liable in the course of expansion to flood the market with its products and find its profits falling to zero or below zero, it seems pointless to pick out particular industries, such as agriculture, as being special cases requiring the use of the classificatory term ‘Diminishing Returns.'” Comment.
5. What effects would you expect a great increase in the income of all classes to have upon (a) the rate of interest, (b) the size of the population?
6. How far is it true to say that capital is free to migrate from declining to expanding industries?
7. In what way does the true rent of land either resemble or differ from (a) the rent of buildings, (b) the high incomes of successful professional men?
8. “The rate of interest tends to equality with the marginal net yield on the capital in use.” How does this come about? Is it an adequate explanation of the forces governing the rate of interest?
9. Why do the prices of some commodities fluctuate much more than others?
10. What are the chief benefits that might accrue to the community as a whole if a highly competitive industry were compulsorily converted into a monopolistic corporation?

 

Monday, May 29, 1933. 1½—4½
SOCIAL PROBLEMS.

1. What evidence, if any, is there that poverty has diminished during the present century?
2. Discuss the difficulties involved in abolishing or modifying the “means test.”
3. Can relief of unemployment be dealt with on an insurance basis?
4. Would a uniform national reduction of wages increase employment?
5. Is England over-populated?
6. Discuss the proposal to build a million houses in five years and pay for them with new bank credits and notes.
7. By what chief methods are industrial disputes settled in Great Britain?
8. Could a general strike improve the position of the wage- earning class?
9. How do you account for the growing use of piece-rates in Russia since they seem inconsistent with the communist principle, “From each according to his capacity, to each according to his needs”?
10. Would you support the proposed international convention for a 40-hour week?

 

Tuesday, May 30, 1933. 9—12.
GENERAL PRINCIPLES II.

A.

1. Discuss the more important ways in which the world with which Economics is concerned differs from that of real life.
2. Explain what you mean by “the supply of labour” and discuss how far it is affected by changes in the rates of remuneration offered.
3. What do you understand by the phrase “the representative producer”? For what purposes is the idea useful?
4. Two commodities are produced under conditions of joint supply. A given tax per unit is laid upon the output of one. Consider the effect upon the price of the other.
5. What conditions are most favourable to the success of a combination of workpeople in order to raise the price of their labour?
6. In what ways is the burden of risk in production and trade distributed under present-day conditions?

B.

7. Give an account of the factors influencing the value of money.
8. Discuss the difficulties involved in the construction and use of index numbers of the cost of living.
9. How is the rate of exchange determined between two inconvertible paper currencies?
10. Describe the working of the London Discount Market and indicate where its importance lies for the student of monetary conditions.
11. Expand the statement that “the ability of any one bank to extend credit depends partly at least on the policy of the others.”
12. How far is “the stabilisation of the level of prices” likely to promote the stability of general business conditions?

 

Tuesday, May 30, 1933. 1½—4½.
ESSAY SUBJECTS.

Write an essay on one of the following subjects:

1. The final goal of society.
2. “A little college is a dangerous thing.”
3. Statesmanship and economics.
4. Hoarding.
5. The future of the English village.

 

Wednesday, May 31, 1933. 9—12.
ENGLISH ECONOMIC HISTORY.

1. “Until the end of the seventeenth century England’s economic position was only of secondary importance.”
   Account for this and for the change which took place in the ensuing century.
2. What was the “yeoman class”? When and why did it decline in importance?
3. What was the influence of the wars of the Revolutionary and Napoleonic period on the economic development of England?
4. Outline the events and the discussions which preceded the Bank Charter Act of 1844 and consider the settlement then achieved.
5. Give a brief account of the “humanitarian movement” and indicate its rôle in the economic and social life of this country.
6. Give some account of the principal factors which influenced the history of British shipping in the second half of the nineteenth century.
7. What were the main features of the financial policy of Gladstone?
8. Indicate and account for the principal changes in the general level of gold prices between 1821 and 1873.
9. What is meant by “economic imperialism”? What forms did it take in this country in the generation preceding the outbreak of the World War?
10. Contrast the structure and general situation of British agriculture in 1850 and in 1914.

 

Wednesday, May 31, 1933. 1½—4½.
ECONOMIC STRUCTURE.

1. “A shift in the geographical distribution of industrial activities is usually associated with technical changes.” Discuss this, giving examples from recent changes in Great Britain.
2. How do you explain the rapid growth in the proportion of the population employed in the distributive trades?
3. “In expanding industries productive capacity can be created far more rapidly than of old.” Consider this statement, giving illustrations.
4. If to-morrow you were appointed dictator of the Lancashire cotton industry for ten years, what would you do? Give your reasons.
5. Give some account of recent developments in retail trading in this country.
6. Under what conditions will an increase in the total output of an industry be secured most cheaply (a) by the expansion of existing plants, (b) by the opening of branches, (c) by the establishment of new firms?
7. In what ways do you consider that public control over the provision of capital for industrial purposes can be improved?
8. In what circumstances will organised restriction of output in any one industry be in the public interest?
9. “It may be a true instinct which foresees the decadence of national prosperity in any special change of industry.” Comment.
10. “Business is becoming a profession which requires a professional training and outlook.” Discuss the truth of this, and its possible effect on the efficiency of management.

 

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PART II.

Monday, May 29, 1933. 9—12.
ECONOMIC PRINCIPLES.

1. State and criticise the case for the view that the conception of Utility is superfluous in economic theory.
2. With what qualifications is it legitimate to suppose that the quantity of a commodity demanded at a given place and time is a function of the price of that commodity only?
3. “The specious symmetry of the expressions ‘law of diminishing returns’ and ‘law of increasing returns’ conceals differences of fundamental importance.” Explain.
4. What part, if any, do the principles governing the increase of population play in the modern theory of value? If you hold that they play no part, show precisely how population theory has been extruded.
5. “Collective bargaining can only secure wage advances at the price of unemployment.” Discuss.
6. Is there any respect in which the laws which govern the rent of land differ from those which govern the value of other factors of production in equilibrium?
7. On what principles should a socialist state determine the optimum rate of saving for the community?
8. Construct, if possible, a general definition of normal profit that will cover the cases both of perfect and of imperfect competition. Or, if that is impossible, give specific definitions appropriate to each case. Justify your procedure.
9. On what grounds would you decide whether a practice of price discrimination was to be condemned?
10. If a particular factor of production is not fully employed in a community, its employment can normally be increased by a reduction in the price at which it is offered. What relevance has this for the problem of raising output in a community in which none of the factors is fully employed?
11. What facts would you need to know in order to measure the advantage which a country derived from its foreign trade?
12. “Monetary theory is destined soon to swallow up the general theory of value.” Discuss.

 

Monday, May 29, 1933. 1½—4½.
INDUSTRY.

1. How do you account for the increase since the War in the proportion of the occupied population engaged in the distributive trades? Is this increase to be deplored from the economic standpoint?
2. Do you think it is correct to regard the last quarter of the nineteenth century as a period of stagnation for British industry, and the early years of the present century as a period of recovery? What evidence is available in support of or in opposition to this view?
3. How would you explain the spread of international industrial combinations since the War? Do the post-War international combinations differ in any important respect from the pre-War international combinations? Have they contributed to economic stability?
4. It is said that the State regulation of railway charges and services has been developed on the assumption that the railway companies are monopolists. Discuss this contention, and consider how State regulation affects the present distribution of traffic between railways and roads.
5. What are “secret reserves”? Does the provision of “secret reserves” afford any advantages to business concerns? Can they be justified from the standpoint of the investor and the public?
6. What is the economic significance of the recent extension of instalment selling? Has this development had an adverse or a favourable effect on the stability of economic life?
7. Discuss the broad changes in industrial localization within Great Britain during the last hundred years, and their bearing on the theory of industrial localization.
8. Do you think that the State is ever justified in enforcing rationalization on an industry? What evidence should the State regard as relevant in considering action of this kind?
9. It is said that certain costs which are variable or prime costs from the standpoint of the employer are overhead costs from the standpoint of the community. Discuss this contention, and consider its bearing on the question of State interference in industrial affairs.
10. Account for the progressive decline in the British cotton industry during the last decade.
11. Discuss the causes of the extension of valorization schemes in world agriculture during the post-War period. Estimate the main economic effects of these schemes.

 

Tuesday, May 30, 1933. 9—12.
MONEY.

1. What light, if any, does the experience of the last three years throw on the comparative merits of the British, German and American systems of deposit banking?
2. Examine the view that an index number of prices must be differently weighted according as to whether the forces determining the value of money are analysed with the aid of the conception of velocity of circulation or with the aid of the conception of a demand for “real balances.”
3. How do you account for the popular notion that money, to serve its purpose well, must be “backed by” some particular kind or kinds of asset? Give instances of the expedients which have been adopted to satisfy this notion in times of crisis.
4. Examine, with special reference to the course of events in the United States in 1922-29, the theory that economic crises are brought about by a deficiency of saving.
5. “The controversy which culminated in the Bank Act of 1844 was simply an episode in the agelong warfare between inflationist and deflationist.” Discuss.
6. Examine the nature, and estimate the strength, of the forces which, in the absence of pressure from a central bank, will tend to bring about adjustment in a country’s balance of payments.
7. Some people hold that, if productivity per head is increasing, the stabilisation by a world monetary authority of an index number of wholesale prices of raw materials would have seriously inflationary consequences. Do you agree with this view? Can you propose any better objective of international banking policy?
8. The present slump has been compared with that of the early ‘nineties. Explain the main points of resemblance and difference.
9. If a Government in a slump spends £100 million, raised by loan, on public works, would you expect the “indirect employment” created to last only as long as the “direct employment,” or to outlast it?
10. You are Finance Minister of an “off gold” country which has decided to re-adhere to an international gold standard. What considerations would you take into account in deciding upon the new parity of exchange?
11. “Foreign investment on a generous scale by the creditor countries was the root cause of the world crisis: it is also the only possible remedy.” Discuss.
12. Discuss the influence of central banking operations on the relation between long and short interest rates, with special reference to the maxim that a central bank should endeavour to secure the equality of natural to market rates of interest.

 

Tuesday, May 30, 1933. 1½—4½.
SUBJECTS FOR AN ESSAY.

1. Japanese Expansion in Asia.
2. Rivers.
3. The Economic Background of the Present Situation in Germany.
4. The Place of Technological and Psychological Factors in Economic Analysis.
5. Graft.
6. The Creative Artist in a Socialist State.
7. The Colour Problem in Africa.
8. Class War.

 

Wednesday, May 31, 1933. 9—12.
LABOUR.

1. Compare broadly the standard of comfort attained by the mass of the people in Great Britain with the standards attained in Germany and the United States of America; and briefly account for the differences.
2. “Unless drastic action is taken to effect a change in the ownership of property, no substantial advance can be made in the direction of equalizing incomes.” Discuss the grounds for this opinion.
3. Did the legislation passed by Parliament between 1832 and 1850 on balance promote or retard the material progress of the working class? Give reasons for your opinion.
4. Explain how the volume of employment in Great Britain would probably be affected if the hours of work for all manual workers in industry and commerce were reduced to 40 per week, without any reduction in weekly wage-rates, (a) in this country only, (b) in all countries.
5. “Experience shows that, while sickness is an insurable risk, unemployment is not, and ought therefore never to have been brought within the scope of social insurance.” Discuss this view.
6. In a recent enquiry into the Sheffield cutlery trade, relating to the period July—December 1931, information was obtained from 67 manufacturing firms (approximately one-third of those known to be engaged in the trade) selected at random, from the outworkers employed by them and from a number of other outworkers. It showed the following results for men and women of 21 years and over:

	Earnings per Hour (Pence)			Earnings per Week
	Upper Quartile	Median	Lower Quartile	Upper Quartile	Median	Lower Quartile
Time Workers:
Men	15.7	13.7	11.5	61s. 1d.	54s. 10d.	45s. 0d.
Women	6.7	5.9	5.5	26s. 0d.	23s. 0d.	21s. 0d.
Piece Workers:
Men	18.2	14.1	11.1	—	—	—
Women	8.4	6.9	5.4	—	—	—

Of the 2,926 workpeople covered by the enquiry, 61.1% were males and 38.9% females. According to figures supplied by representatives of the trade unions, it would appear that in 1932 less than 20% of the workers in the trade were organized in trade unions. If you had been Minister of Labour, would you have regarded this information as affording sufficient ground for applying the Trade Board Acts to the trade? And how would you have defended your decision?

7. “To show that wages in a depressed industry with an international market are higher than those paid for similar work in the same industry abroad does not afford sufficient reason for thinking that a reduction of wages is an appropriate remedy for its depression: in order to establish that conclusion it must be shown also that they are higher than those paid for the same skill and efficiency in other industries at home.” Examine this contention.
8. It has been proposed that a national authority, constituted similarly to the railways’ National Wages Board, should be established to regulate wages and conditions of work in coal mines throughout the country. Discuss the merits of this proposal.
9. “The differences of structure and policy between the trade union movements of England and the United States are to be traced to historical accidents rather than to any differences in the present character or organisation of the industries of those countries.” How far is this true?
10. What statistical or other scientific evidence is there as to the effect of (a) noise, (b) rest-pauses, (c) temperature upon output?
11. Explain, with reference to the history and the underlying economic conditions of the two industries, why the “sliding-scale” principle of wage-settlement worked successfully in the iron and steel trade, but failed to preserve industrial peace in the coal trade.

 

Wednesday, May 31, 1933. 1½—4½.
PRINCIPLES OF POLITICS.

1. “The Nation, by its power and its duration, is an organism, with an existence, ends and means of action superior to that of the individuals, separate or grouped, who compose it.” (Italian Charter of Labour, 1927. ) Discuss this view.
2. “The normal course of improvement starts from origination by pure social invention, and passes subsequently, if at all, into adoption by the State” (Bosanquet). Discuss the view of the relation between Society and the State which is implied in this statement.
3. What are the limits, if any, to the application by the State of the principle of Equality among its members?
4. “Liberty is not one, but many, and its various forms may contradict one another.” Discuss this statement.
5. Discuss the idea that law is the enforcement by the community upon its members of a moral minimum of conduct.
6. How far can an international sovereign authority co-exist with national State-sovereignty?
7. Would you agree with the view that a system of representative institutions for the economic world ought to be placed by the side of representative political institutions?
8. On what principles may the State seek to regulate or control the freedom of thought of its members?
9. On what grounds would you seek to justify the necessity of party and party-organisation for the proper working of Government?
10. The French Declaration of Rights of 1789 includes the right of resistance among les droits de I’homme et du citoyen. In what sense, if any, can a citizen have a “right” to resist the State?
11. Discuss, with reference to your general conception of rights, the idea of a “right to work.”
12. Would you agree that the “separation of the powers” (or functions) of government is a necessary principle of politics?

 

Thursday, June 1, 1933.  9—12.
PUBLIC FINANCE.

1. Consider the attempts that have been made to frame general rules for Expenditure analogous to those established for Taxation. Account for the relatively backward condition of the former division of Public Finance.
2. Examine the views that have been put forward concerning the principle according to which motor-vehicle owners should be taxed, and consider the principle or principles to which the present taxes on motor-vehicle owners tend to conform.
3. Discuss the extent to which the main differences between the various theories of taxation may be attributed to divergent views of the functions and the nature of the State.
4. What is there to be said for and against having a quinquennial instead of an annual budget?
5. On what considerations is the maxim that a government should not issue loans below par based? Does the maxim admit of exceptions?
6. Discuss the view that the Government should spend the revenue derived from death duties on capital purposes.
7. As a means to increasing prosperity, it has been proposed (a) to reduce taxation without reducing government expenditure, or, alternatively, (b) to increase government expenditure without increasing taxation. Compare the probable effects of these two policies.
8. “The law of diminishing utility is sound enough when applied to a particular commodity, but it cannot be extended to wealth in general: consequently all the elaborate arguments and formulae for tax-graduation are without logical foundation.” Comment.
9. Explain exactly what is meant by Most Favoured Nation treatment, and examine the view that its prevalence constitutes an obstacle to the recovery of world trade.
10. Discuss, with reference to the practice of other countries, possible alternatives to the methods of local taxation at present in force in England.
11. Is there any foundation for the view that inter-governmental war-debts are more harmful to trade than (a) other debts owed by governments to foreigners, (b) internal war-debts?
12. Compare the effects, (a) on home producers, (b) on consumers, of an import duty and an import quota.

 

Thursday, June 1, 1933. 1½—4½.
THE ECONOMIC DEVELOPMENT OF THE UNITED STATES.

1. “America is really a federation of sections rather than of States.” Consider this statement from the economic point of view as applied to American conditions in 1789, 1850 and to-day.
2. Examine, in the light of the first half century of American history after 1789, the economic powers which the constitution gave to the National Government.
3. Discuss the policy of the United States Government in dealing with the Public Lands down to the Homestead Act of 1862.
4. Criticize the methods used by the North to finance the Civil War.
5. “Southern experience before and since the Civil War condemns slavery as an economic institution.” Discuss this statement.
6. Illustrate the influence of the westward movement within the continent on the economic outlook of the American.
7. What problems were created by the consolidation of the railways and what measures were taken as a consequence to protect the public interest?
8. Account for the leading position acquired by the United States in the iron and steel industry.
9. Explain the change that has taken place in the twentieth century in the American attitude towards immigration.
10. To what extent have economic motives influenced the oversea expansion of the United States?
11. “America has no national economic history, in the sense in which France or England has, until the generation after 1880.” Discuss this statement.

 

Thursday, June 1, 1933. 1½—4½.
STATISTICS.

Part A.

1. Estimate the average, mode and median for the group of rents in Table A. Criticise the use of the formula skewness = (average—mode) standard deviation in this case, and suggest or calculate an alternative measurement.

Table A. Three-roomed tenements.

Rent	Number
Under 2s. 6d.	1
2s. 6d. to 5s.	3
5s. to 7s. 6d.	14
7s. 6d. to 10s.	29
10s. to 12s. 6d.	27
12s. 6d. to 15s.	13
15s. to 17s. 6d.	11
17s. 6d. to 20s.	2
	100

 

2. Fit a straight line by least squares or any other method to the series of index-numbers in Table B.

Table B. Index of Production.

	Years
Quarters	1927	1928	1929	1930	1931
1st	110	105	108	109	84
2nd	107	103	110	100	80
3rd	105	95	107	90	80
4th	107	104	114	92	90
Average 100

Make a graph of the figures, marking in (1) the straight line found and (2) moving averages based on eight successive quarters.
Comment on the results.

3. If are the averages of n observations of (x, y) pairs, and in the array at there are n_s cases with average , show that .

Work out r and the correlation ratio for the figures in Table C.

Table C.

Number of earners	Number of families	Average number of dependents
x	ns
0	8	1.5
1	54	2.1
2	19	1.8
3	11	2.0
4	5	2.2
5	3	2.5
	100

Make a graph of the averages showing the regression line. Comment on the utility of the procedure in this case.

4. From a large population 100 workmen are selected at random and are classified thus:

	Occupation
Birthplace	Skilled	Unskilled
Town of residence	30	38
Elsewhere	10	22

Do you find any relationship between skill and birthplace? Table D may be used if needed.

Table D. Values of P.

Number of Compartments	0	0.5	1.0	1.5	2.0
2	1	0.48	0.32	0.22	0.16
3	1	0.78	0.61	0.47	0.37
4	1	0.92	0.80	0.68	0.57

 

Part B.

5. What data are used for forecasting the future trend of population and what assumptions are made? Consider also the more limited question of determining whether a population is self-productive or is tending towards diminution.
6. Among the statistics used for studying the change of the industrial position are (a) an index of physical production, (b) the number of insured persons in employment, (c) an index of wage-rates, (d) occasional accounts of average earnings. What relationships do you expect to find between these statistics in a period of increasing depression or in a period of recovery?
7. Explain in some detail the construction of index-numbers of average prices and of volume of trade from statistics of exports and of imports. Describe some of the purposes for which these figures are used and consider whether they are sufficiently accurate for these purposes.
8. Examine carefully the question whether index-numbers of wages and of cost of living can be combined so as to show the relative movements of real wages in different countries.
9. Describe one of the mathematical methods of constructing “demand curves” from existing data, and consider in what sense they can be called demand curves.

 

Friday, June 2, 1933. 9—12.
INTERNATIONAL LAW.

1. Comment upon the international status (if any) of the following:

(a) The Dominion of Canada;
(b) The Saar Basin;
(c) The State of California;
(d) Switzerland.

2. What are the main legal consequences that flow from the independence of States?
3. Show in what respects a mandated territory differs from (a) a colony, (b) a protectorate. What (if any) is the sanction for the enforcement of the terms of a mandate?
4. Describe the constitution and purpose of the International Labour Organisation and the method of the composition of the delegations sent by members to its Conferences. Mention any two of the Labour Conventions adopted by it and now in force.
5. How far has the process of codification been applied to international law? What are the difficulties in the way of further codification?
6. Describe the three principal methods for the settlement of disputes prescribed by the Covenant of the League.
7. Discuss the lawfulness and the effectiveness of an economic boycott,

(a) when applied by the nationals of one State against the commerce of another;
(b) when applied by the international community against a wrongdoing State.

8. Summarise the effect of the outbreak of war upon

(a) treaties to which all the belligerents and no neutrals are parties, and
(b) contracts between the nationals of opposing belligerents.

9. How much of the Declaration of Paris, 1856, has in your opinion survived the developments of maritime warfare in the Great War?
10. In what respects do you consider that the Covenant of the League, the Kellogg-Briand Pact, and the Convention on Financial Assistance (1930) have modified the law of neutrality?

 

Source:  Cambridge University. Economics Tripos Papers 1931-1933. Cambridge, UK: University Press, 1933, pp. 53-70.

Image Source: King’s College, Cambridge, England. Library of Congress Prints and Photographs Division Washington, D.C. 20540.