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Worksheet 3 essay - ws gggg
Wirtschaftsenglisch 1 (343.103)
Universität Graz
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NAME Tim Kirschner
WORKSHEET, Naked Economics: Chapter 3
Note: Please don't copy long passages of text (more than one sentence), as these will not be accepted. If I ask you to "explain" something, then I expect you to use your own words.
- When submitting your work via moodle, use the file format LASTNAME_Firstname_Week1 or write your answers directly into the moodle text box.
Describe and explain the "pooper scooper problem." The pooper scooper problem explains the case when dog owner refuse to pick up after their dogs. This is a possible threat for people going the same way because they might slip in dog waste. This is one Wheelan’s examples for externalities. Externalities happened when private cost and public cost differ. This means that the dog owner has no incentive to pick up after his dog because drastically spoken he must not pay the medical bill for the person who might slipped in the dog waste. If he had to pay for it, he might think twice to pick it up.
Choose ONE of Wheelan's examples on pages 60-62 and explain it in your own words. The climate change is not adequately addressed by the market because firms do not have to pay the full price for their greenhouse gas pollution. This is another example for externalities. Firms who emit a large amount of greenhouse gases which might cause flooded areas or people dying to lung problems because of the pollution do not have to pay for this. The only way to stop this from happening is to raise the private costs of pollution which should push firms to think about alternative ways or to pay the proper price for the damage they cause.
Explain why smoking is viewed as both a positive and a negative.............................. Negative: It endangers lives of the people who smoke and those people affected by the smoke. It is also bad for public Medicare because people who smoke often have issues with their health and do cost more when it comes to health care. The positive aspect is that these people who smoke on average die seven years earlier. This has positive effects on Social Security and private pension funds because if you die early but paid your lifetime into these funds these funds gained more money than they have lost. That’s why the society can also profit from smokers.
What does BYOI mean? Explain. BYOI means bring your own infrastructure. This refers to countries who have failed to build a public infrastructure (interstates, railroads, streets) so that their economy suffers a big efficiency loss because firm must find ways how to deliver their goods. This harms growth of an economy.
5 the rules for a functioning market economy (this goes across several pages!). The tool for a functioning market economy is the government. The government is the umpire of the market and must set the right frames for the market. Firstly it has to define and protect property rights which involve tangible and intangible resources. This means that you can buy sell and invest in something that is yours and within limits you can do with it what you want. Secondly good regulation is important which means law that is applied and lawyers who defend the law. This serves to control the market. It leads to people having trust in the markets which is
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also a very important aspect for trade. Furthermore, government must provide and maintain public goods (interstates, public places). And government must redistribute wealth which means they collect taxes for some citizens to provide benefits for others.
Explain and discuss the case of Abdul Waheed Mohammad Nanhe. The case was opened because Waheed felt that his property rights were damaged by Nanhe. Nanhe had built several drains at the edge of his property that emptied into Waheed’s front yard which hampered Waheed from building a third room. If this lawsuit would have been brought to an Austria court, Mr. Nanhe would have had to stop emitting on the property of his neighbor so he would have had to find another spot for his drains. It is forbidden (in Austrian law) to influence the property of your neighbor over a certain level. After several years the case made it to court but both men were already dead.
In the example cited by Amartya Sen, who deserves to get the job? Explain. There is no right answer to that. Amartya Sen draws the situation that you have one job, and you try to hire a person for that job. There are three men applying who all are equally qualified. Who should you hire to maximize the welfare for Society if the first is the poorest, the second the unhappiest and the third has a big health issue, and with the job they were all better off? This points out that economics does not have the answer to every problem because this question is rather philosophical. I would probably hire the third man with the health issue because he was worse off from the beginning of his live and it was not his fault. So, in my opinion he would deserve the job most.
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Worksheet 3 essay - ws gggg
Kurs: Wirtschaftsenglisch 1 (343.103)
Universität: Universität Graz
