InThinking and Financial Times collaboration

Dear InThinking subscribers,

At InThinking, we are delighted to inform you of our collaboration with the Financial Times “FT Schools” initiative.

FT Schools provides secondary school students with free access to high-quality financial journalism and resources from the Financial Times. Through the collaboration, we will be providing teachers and students access to educational materials and engaging content to enhance financial literacy, deepen understanding of contemporary issues in the real world, and foster critical thinking about global issues and their impact on individuals and societies.

Wider reading helps our students:

• Build critical thinking by analysing complex Economics issues with a balanced and objective approach.
• Contextualise learning by connecting Economic theory covered in the classroom to real-world applications.
• Improve communication skills by engaging with diverse viewpoints, thereby improving their ability to articulate their thoughts clearly and persuasively.
• Make informed decisions by accessing a variety of sources to develop a well-rounded perspective, based on comprehensive analysis rather than limited information.
• Engage with the subject by having exposure to contemporary issues in the real world to help foster curiosity and enthusiasm, motivating them to explore topics further and participate actively in class discussions.

You can read more about the FT Schools service by clicking on the icon below.

In this first FT Schools blog, we cover the recent FT article about US multinational companies Visa and Mastercard accounting for the majority of credit card payment transactions in the Eurozone, meaning Europeans are dependent on these foreign monopoly providers for everyday payments.

How this article connects to the Cambridge IGCSE Economics (0455) syllabus:

1️⃣Monopoly power

Visa and Mastercard are dominant firms in the credit card payments market, close to a duopoly (a market dominated by two firms).

A duopoly is a form of imperfect competition, where Visa and Mastercard have significant market power and influence over prices (credit card fees and charges to customers and retailers) and service standards. 

Students can link this to IGCSE definitions of monopoly and market failure, where firms with large market power can set fees and exclude competitors. These issues are important topics in the syllabus (Topic 2.9.3 Abuse of monopoly power as a cause of market failure and Topic 3.7.2 Monopoly markets).

2️⃣Barriers to Entry

Europe’s desire for alternatives highlights how barriers to entry (such as technology, infrastructure, economies of scale, and brand loyalty) keep competition low. Visa and Mastercard’s large networks, global acceptance, and brand trust act as barriers to entry that make it hard for new firms to compete.

This real world example shows how major firms maintain market dominance - which is ideal for explaining barriers to entry and market power to add context to the contents of the syllabus.

3️⃣Government policy response

The article suggests government policy action - Europe is supporting efforts to build a domestic alternative credit card payments system.

This connects to syllabus topics on government intervention when markets have very few competitors and consumers may face higher prices or less choice (Topic 2.10.3 Government intervention to address market failure).

For IGCSE exam practice questions and answers based on this FT article, visit the site page here on InThinking.