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IB Humanities • SL

IB Economics SL

Use this IB Economics SL study guide to browse the syllabus topic structure, study materials, and practice resources.

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IB Economics SL Question Bank

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1. Introduction to Economics

1.1 What is economics?

1.1.1 Economics as a social science
1.1.2 The problem of choice
1.1.3 The production possibilities curve model (PPC)
1.1.4 Modelling the economy

1.2 How do economists approach the world?

1.2.1 Economic methodology
1.2.2 Economic thought

2. Microeconomics

2.1 Demand

2.1.1 The law of demand
2.1.2. Demand curve
2.1.3 Consumer and market demand
2.1.4 Non-price determinants of demand
2.1.5 Movements and shifts of the demand curve

2.2 Supply

2.2.1. The law of supply
2.2.2. The Supply Curve
2.2.3. Individual producer’s supply and market supply
2.2.4. Non-price Determinants of Supply
2.2.5. Movements along and shifts of the supply curve

2.3 Competitive Market Equilibrium

2.3.1 Demand and supply curves forming a market equilibrium
2.3.2 Shifting demand and supply curves to produce a new market equilibrium
2.3.3 Functions of the price mechanism
2.3.4 Consumer and producer surplus
2.3.5 Social/community surplus
2.3.6 Allocative efficiency at the competitive market equilibrium

2.5 Elasticities of demand

2.5.1. Concept of elasticity
2.5.2. Price elasticity of demand (PED)
2.5.3 Importance of PED for firms and government decision making
2.5.5 Income elasticity of demand (YED)

2.6 Elasticity of supply

2.6.1. Price elasticity of supply (PES)

2.7 Role of government in microeconomics

2.7.1. Reasons for government intervention in markets
2.7.2. Main forms of government intervention in markets

2.8 Market failure - externalities, common pool resources, public goods, asymmetric information

2.8.1 Marginal social benefit (MSB) equals marginal social cost (MSC).
2.8.2 Government intervention in response to externalities and common pool resources
2.8.3 Strengths and limitations of government policies to correct externalities
2.8.4 Importance of international cooperation

2.9 Market failure - public goods

2.9.1. Public goods
2.9.2 Government intervention in response to public goods

3. Macroeconomics

3.1 Measuring economic activities

3.1.1. National income accounting as a measure of economic activity
3.1.2. Income, output and expenditure approaches to national income accounting
3.1.3. Nominal GDP as a measure of national output
3.1.4 Nominal GNI as a measure of national output
3.1.5 Real GDP and GNI
3.1.6 Real GDP/GNI per person (per capita)
3.1.7 Business cycle
3.1.8 Appropriateness of using GDP or GNI statistics
3.1.9 Alternative measures of well-being

3.2 Variations in economic activity - aggregate demand and aggregate supply

3.2.1. Aggregate demand (AD)
3.2.2. Components of AD (consumption)
3.2.3. Determinants of AD components
3.2.4. Shifts of the AD curve caused by changes in determinants
3.2.5. Short-run aggregate supply (SRAS) curve
3.2.6. Shifts of the SRAS curve
3.2.7. Alternative views of aggregate supply (AS)
3.2.8 Shifts of the AS curve over the long-run
3.2.9 Macroeconomic equilibrium
3.2.10 Assumptions and implications of the monetarist/new classical and Keynesian models

3.3 Macroeconomic objectives

3.3.1 Economic growth
3.3.2. Consequences of economic growth
3.3.3. Low unemployment
3.3.4. Low and stable rate of inflation
3.3.5. Relative costs of unemployment versus inflation
3.3.8. Potential conflict between macroeconomic objectives
3.3.9. High economic growth

3.4 Economics of inequality and poverty

3.4.1. Relationship between equality and equity
3.4.2. The meaning of economic inequality
3.4.3. Measuring economic inequality
3.4.4. Meaning of poverty
3.4.5 Measuring poverty
3.4.6 Difficulties in measuring poverty
3.4.7 Causes of economic inequality and poverty
3.4.8 Impact of income and wealth inequality
3.4.9 Role of taxation in reducing poverty, income and wealth inequalities
3.4.10 Further policies to reduce poverty, income and wealth inequality

3.5 Demand management - Monetary policy

3.5.1. Monetary policy
3.5.2. Goals of monetary policy
3.5.6. Real versus nominal interest rates
3.5.7. Expansionary and contractionary monetary policies to close deflationary/recessionary and inflationary gaps
3.5.8 Effectiveness of monetary policy

3.6 Demand management - fiscal policy

3.6.1. Fiscal policy
3.6.2. Goals of fiscal policy
3.6.3. Expansionary and contractionary fiscal policies in order to close deflationary/recessionary and inflationary gaps
3.6.5 Effectiveness of fiscal policy
3.6.6 Strengths of fiscal policy

3.7 Supply side policies

3.7.1. Goals of supply-side policies
3.7.2. Market-based policies
3.7.3. Interventionist policies
3.7.4. Demand-side effects of supply-side policies
3.7.5. Supply-side effects of fiscal policies
3.7.6. Effectiveness of supply-side policies

4. The Global Economy

4.1 Benefits of International Trade

4.1.1 Benefits of International Trade

4.2 Types of Trade Protection

4.2.1 Tariffs
4.2.2 Quota
4.2.3 Subsidy/export subsidy
4.2.4 Administrative Barriers

4.3 Arguments For and Against Trade Protection

4.3.1 Arguments For Trade Protection
4.3.2 Arguments Against Trade Protection
4.3.3 Free Trade Versus Trade Protection

4.4 Economic Integration

4.4.1 Preferential Trade Agreements
4.4.2 Trading Blocs
4.4.3 Advantages and disadvantages of trading blocs
4.4.4 Monetary union
4.4.6 The World Trade Organization (WTO)

4.5 Exchange Rates

4.5.1 Floating Exchange Rates
4.5.2 Changes in Demand and Supply of a Currency
4.5.3 Consequences of Changes to the Exchange Rate
4.5.4 Fixed Exchange Rates
4.5.5 Managed Exchange Rates

4.6 Balance of Payments

4.6.1 Balance of payments
4.6.2 Components of the balance of payments
4.6.3 Interdependence between the accounts

4.7 Sustainable Development

4.7.1 The meaning of sustainable development
4.7.2 Sustainable Development Goals

4.8 Measuring Development

4.8.1 The multidimensional nature of economic development
4.8.2 Single indicators
4.8.3 Composite indicators
4.8.4 Strengths and limitations of approaches to measuring economic development
4.8.5 Possible relationship between economic growth and economic development

4.9 Barriers to Economic Growth and Economic Development

4.9.1 Poverty Traps and Poverty Cycles
4.9.2 Economic Barriers
4.9.3 Political and social barriers
4.9.4 Significance of different barriers to economic growth and/or economic development

4.10 Economic Growth and Economic Development Strategies

4.10.1 Strategies to Promote Economic Growth and Economic Development
4.10.2 Strengths and Limitations of Strategies for Promoting Economic Growth and Economic Development
4.10.3 Strengths and Limitations of Government Intervention Versus Market-Oriented Approaches to Achieving Economic Growth and Economic Development
4.10.4 Meeting the Sustainable Development Goals
Overview

Course overview

How to study IB Economics SL

IB Economics SL, in its current form first assessed in 2022, uses theories, models, concepts, and empirical evidence to examine choices under scarcity in markets, national economies, and the global economy. The course connects introduction to economics, microeconomics, macroeconomics, and the global economy through nine key concepts: scarcity, choice, efficiency, equity, economic well-being, sustainability, change, interdependence, and intervention. SL emphasises secure model use, real-world application, data response, and balanced evaluation. The StudyIB catalogue below follows these four current units and identifies HL-only material where applicable.

Models, diagrams, and causation

Select the correct model, label and shift it accurately, then explain the causal chain from the initial change to price, output, welfare, distribution, or development outcomes.

Real-world evidence and data

Use current, specific evidence to test economic theory and interpret data, calculations, trends, and limitations before making a conclusion.

Concept-led evaluation

Evaluate policies through assumptions, stakeholders, elasticity, time, equity, sustainability, and unintended effects.

Assessment at a glance

IB Economics SL, first assessed in 2022, combines written external assessment with a portfolio of three news-based commentaries.

ComponentFormatWeighting
Paper 11 hour 15 minutes; extended-response questions based on all four syllabus units30%
Paper 21 hour 45 minutes; data-response questions based on all four syllabus units40%
Internal assessment20 hours; portfolio of three commentaries using different units, news extracts, and key concepts30%

Sources: official IB Economics SL subject brief (first assessment 2022) and official IB Economics course page.

Revision plan

  1. 1.Organise each syllabus subtopic around definitions, assumptions, a labelled diagram, a causal chain, a real-world example, and likely evaluation conditions.
  2. 2.Build connections across the nine key concepts instead of treating them as a separate vocabulary list.
  3. 3.Practise Paper 1 arguments and Paper 2 data responses under time, keeping diagrams and evidence integrated into the explanation.
  4. 4.Track errors by theory, diagram, calculation, application, command term, and evaluation, then revisit mixed questions across all four units.

Exam strategy

Let the command term determine the depth. Define the relevant concept, draw only a useful diagram, explain every movement or relationship, and apply specific real-world evidence. Evaluation should be developed through the response and should identify the conditions under which a conclusion holds. In Paper 2, read the extracts and data as evidence rather than reproducing a memorised essay.

Practise IB Economics SL questions

Frequently asked questions

What topics are covered in IB Economics SL?

IB Economics SL is organised into four units: introduction to economics, microeconomics, macroeconomics, and the global economy. SL studies the shared course content and applies models and concepts to real-world issues.

What are the nine key concepts in IB Economics?

The nine key concepts are scarcity, choice, efficiency, equity, economic well-being, sustainability, change, interdependence, and intervention. They should be used to analyse and evaluate real-world issues rather than added as isolated definitions.

How is IB Economics SL assessed?

SL Paper 1 lasts one hour 15 minutes and contributes 30%; Paper 2 lasts one hour 45 minutes and contributes 40%; the internal-assessment portfolio contributes 30%.

What is the IB Economics internal assessment?

Both SL and HL students submit a portfolio of three commentaries based on published news-media extracts. The commentaries must come from different syllabus units other than the introductory unit and use different key concepts as analytical lenses. Confirm article dates, word limits, citations, and school deadlines with the current guide and your teacher.

What is the difference between IB Economics HL and SL exams?

SL takes Paper 1, an extended-response paper, and Paper 2, a data-response paper. It does not take the HL policy Paper 3, although SL answers still require accurate diagrams, real-world application, data interpretation, and evaluation.