Microeconomics Real-World Examples

9 IB Economics case studies in microeconomics, each with the syllabus topics it covers, evaluation points for both sides, and the key terms to define.

Vaping device beside South African rand coins representing an excise tax on vaping

Indirect Tax Policy

South Africa's Vaping Excise Tax

South Africa2023 onwards

South Africa taxes vaping liquid to discourage consumption and raise revenue, illustrating how indirect taxes can address market failure.

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Wind turbines and solar panels receiving financial support for renewable energy investment

Subsidy Policy

EU Renewable Energy Support Schemes

European Union2024 onwards

EU countries use renewable-energy support schemes and auctions to encourage investment, increase clean-energy output and support climate goals.

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Search engine results and competing browser icons representing monopoly power in online search.

Regulation

Google Search Monopoly: Government Action Against Market Power

United States2020–present

A US court found Google illegally maintained search monopolies and imposed rules designed to make it easier for rivals to compete.

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Music waveform with an AI marker showing transparency rules for AI-generated audio.

Regulation

EU AI Act and AI Music: Reducing Asymmetric Information

European Union2026–present

EU transparency rules require AI-generated audio to be detectable, aiming to reduce information gaps between creators and listeners.

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Two passenger aircraft approaching a merger symbol, representing government control of airline market concentration.

Regulation

JetBlue–Spirit Merger: Government Action to Protect Competition

United States2022–2024

A US court blocked JetBlue's $3.8 billion takeover of Spirit, finding that the merger would reduce competition and harm many travellers.

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Several car manufacturers around a recycling symbol representing cartel behaviour in the motor industry.

Regulation

European Car Recycling Cartel: Collusion in an Oligopoly

European Union2002–2025

EU regulators fined major carmakers €458 million for colluding on vehicle recycling, showing how governments can tackle cartel behaviour.

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Industrial factories trading carbon permits under the European Union emissions trading system.

Regulation

EU Emissions Trading System: Reducing Industrial Carbon Emissions

European Union2005–present

The EU uses tradable pollution permits to make firms pay for carbon emissions and reduce the negative externality from production.

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NHS vaccination programme showing a person receiving a vaccine while others in the community are also protected.

Subsidy Policy

UK-Funded Vaccination: A Positive Consumption Externality

United Kingdom2026–present

The UK government funds NHS vaccination programmes because vaccines protect individuals and also reduce risks for other people.

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American farmers and agricultural land during the Great Depression, representing federal payments to reduce farm output.

Subsidy Policy

U.S. Farm Subsidies under the 1933 Agricultural Adjustment Act

United States1933–1936

The U.S. paid farmers to cut production during the Great Depression, reducing supply to raise agricultural prices and farm incomes.

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