12/12

• Profit = Total Revenues - Total Costs
• implicit costs, which includes opportunity costs, need to be factored in
• Economic Profit = Total Revenues - Total Implicit Costs and Total Explicit Costs
• implicit costs are the opportunity costs, money or something else foregone
• Profit- whatever's left over
• not possible when there is certainty
• certainty present, then more people enter your market, shift the supply curve or demand curve,  and inadvertently change your revenues
• bid up the prices; increases input costs
• Wage
• contractual agreement between the worker and the firm that specifies what the worker has to do and what his/her compensation is
• point- eliminate uncertainty 
• rent's point as well
• Profit vs Nonprofit companies
• profit- entrepreneurs make the decisions; profits tie with betterment of socitey: society better, profit up    society down, profit down
• nonprofit- entrepreneurs don't make decisions; NO feedback loop
• Feedback loop and Losses
• mute the losses and the feedback loop is destroyed
• results in unexpected and unforeseen closing due to not being aware of losses because of no feedback process

12/9

Profits, Losses, and Entrepreneurs

•  Companies make money by satisfying needs, not causing them
• Profits do not necessarily have a negative connotation
• doesn't mean companies are exploiting us
• Entrepreneur Process
• Find out what people want
• Get the Means to produce said product
• Land 
• explicit cost
• rent: buying land
• implicit cost
• rent: opportunity cost of renting home to others for $
• Labor 
• explicit cost
• wages: paying the labor
• implicit cost
• foregone wages
• Capital
• explicit cost
• rent
• implicit cost
• foregone rent
• Explicit Cost + Implicit Cost = Total Cost
• implicit= opportunity cost ; explicit= product cost
• Profitability
• Rental Rate + Appreciation Rate - Interest Cost
• Rental Rate = Annual Rate/Price of Good
• benefit of buying is the foregone rental payments
• Example: Lease for 1 yr = $12,000    Buy= $32,000 Annual Rate/Price of Good     $12,000/$32,000= 37.5%
• Appreciation Rate = change in asset price/price
• Example continued: -8,000/32,000= -25%
• Interest Cost
• Example: 10%
• Example finished: 37.5% - 25% - 10% = 2.5%
• The 2.5%  is the amount that would be saved if the product was bought. 

week 14 reading

The Sumptuary Manifesto

It seems that this is a declaration that we should create new laws to dictate how people should live freely. Some of these changes can be beneficial but at what cost. The tradeoff appears to be reduction of individual human rights for society being better off as a whole. No matter how better off society might stand to be, it'd never work. People would judge their individual opportunity costs to be too high and the majority rule would supersede the sumptuary supporters

EWOT week 12/5-12/9

When I go into a store to buy something and I have to pay for the price of the product and its tax, at least I know some of the tax's burden falls on the seller as well. It's not all on me.

12/7

• Taxes prevent mutually beneficial transactions from happening
• Taxes easily distort information
• Taxes require a very considerable amount of time and effort
• Sales Tax
• buyer pays 
• reminder: in excise tax the seller pays
• New Equilibrium is where the sales tax line and supply line cross (aka the price tag)
• two prices
• Bubble Gum graph as an example
• initial P= $3 Final P = $2.75 Tax Paid= $1.00
• Buyer's Total Cost= $ 3.75    Seller's Total Cost= $2.75
• Burden (Real Cost From Initial Price)(how the tax is paid)
• Buyer:  $0.75
• Seller: $0.25
• Economic Incidence is independent of who has to pay the tax
• determined by relative elasticity 
• when buyers are insensitive (inelastic), they'll pay the bigger burden of the tax
• buyers are elastic, the sellers will pay bigger burden
• supply and demand curves inelastic
• tax won't be distortionary 
• Subsidy
• Doesn't matter who is subsidized
• relative supply and demand of product is what matters

12/5

The Economic Incidence of Supply and Demand Changes

Application: Taxation

• Depressions and recessions make taxpayers question what they value
• Prohibition failed during the Great Depression because a great percentage of tax revenue came from the liquor tax; revenues trumped drinking dangers
• Excise Tax: the legal respnsiblity of the the tax is on the seller
• supply taxed shifts in parallel to original supply
• price does not increase by the amount of the tax
• drives a wedge between the price buyers are wiling to pay and the price sellers are willing to sell
• because the tax is greater than possible transactions, those transactions wouldn't have happened
• Tax Evasion increases the costs associated with taxation

12/2

• Price Ceiling
• Rent Control Example
• $ Ceiling makes people pay more for their apartment 
• poorer quality
• laundry
• food
• Increasing supply is desirable
• Raise in price
• clears the table (economic table)
• Graphs
• Change in the curves in terms of steepness or flatness changes
• Elasticity
• Price Floor
• lowering wages
• results in reduction of worker supply
• Rarity vs Scarcity
• scarcity is relative, only happening  when the want exceeds the amount
• rarity is not relative, quantity demanded almost always equaling the supply
• Black Market- Drugs graph 
• a drug becomes illegal then
• the supply curve becomes much steeper, more elastic
• the costs increase
• competition is influential factor

11/28-12/2 EWOT

If I can convey that I value a good more than any of my fellow college students, I have a better chance of getting it then they. The only exception is if we were looking for apartments which are limited  by a price ceiling rendering value of a good useless

11/30

Economics of Price Controls: Price Ceilings and Rent Controls

• Rent: Two meanings
• payment for use of a unit
• something that is accrued to you that was not the result of your abilities; income not earned(economic meaning)
•  ex: landlord receiving a rent of $200 in addition to his normal  prices
• should this kind of rent be taxed
• Equilibrium [important]
• Market
• example alpha: P= $1000 Q= 12,000 (set as 1 Q)
• Controlled
• change from market equilibrium
• example alpha (cont.): P= $800 Q1= 14,000 Q2= 10,000 (Binding)
• Q1 is now more than 1 Q this means: this equilibrium is NOT MARKET CLEARING
• Price Ceiling [important]
• Binding: when it is set below the level that would have brought about market clearing
• Does lowering the price of a unit means it has become more scarce? [important]
• It depends on reason for lowering the price
• price ceiling change for a controlled equilibrium = no
• no explanation available = yes
• Consequences of Rent Control
• Reduced availability and harder to get
• many people, few apartments
• Lower Quality
• have to tolerate it because others are willing to have your room
• Other $ will be paid
• Black Markets will emerge
• Misallocations
• side deals left on the table; this time people who value the unit the most won't get it
• Other Markets are impacted
• increased prices in the city causes shortage of consumers who will look to live outside of the city which will raise their prices
• look at example alpha, Q1 to Q2 there is a shortage of 4,000 apartment renters
• Fairness
• what about the poor
• Discrimination
• the costs of doing so are not felt; many people will come to rent
• race, looks, size, gender, etc.
• Monitoring/Enforce Costs: 3
• long run supply curve will shift in and become flatter
• monitoring itself is destructive
• no production of goods and services that people want; 
• taxes to fund them which is costly
• Price ceilings are destructive and too constraining 
• Recitation
• public good- no one is excluded from sharing the benefits
• free rider- person who benefits from a public good without contributing to it 

11/28-12/2 reading

The economic problem which our society faces is how to best allocate the scarce resources that we have. It's said that this problem could be solved through an economic organization just that this kind of facilitation is not a sure-fire guarantee. The major obstruction is how to decide who would do the planning, who to be the planner. In this sense, it's difficult to construct an efficient economic organization as no one retains tacit knowledge. So, it comes down to whether the planning should be centralized or divided among multiple members. It is more efficient to pick the latter which would then shift the choice from who will the planner be to who will the qualified members be. The more people chosen, the more knowledge is obtained as well as a variety of skills. Through the joint effort of the members of the economic organization, it can be ascertained how to adapt to circumstances dealing with both time and location. Communicating information is the essential key and we have already begun to figure out how to do so through the price system and to an extent the feedback loop. These institutions relay information through prices and create a division of labour which help facilitate efficiency. Through improving on these institutions can we make more efficient our economic system

11/28

• EQ (equilibrium)
• Stylized economy with an equal number of sellers and buyers(not necessarily distinct)
• "No money on the table" which = efficient market with equal amount of buyers and sellers
• Unless you pick the right consumer, you leave valuable side deals and money on the table
• X Graph: Sellers SW to NE, Buyers NW to SE. Equilibrium price Centered
• Side Deals
• Can create surpluses
• Example: person 4 values guitar $15 while person 2 values guitar $25; person 4sells guitar to person 2 which results in $10 surplus (25-15)
• Final Price to make a good
• Salary to the worker
• Cost of making the product using the necessary inputs
• Opportunity cost of making a profit off another good
• How can you determine the Central Price?
• Consistent problem with equilibrium
• Set it too high: side deals left on the table and low quantity sold/low profit
• Set it too low: side deals left on the table and low prices/low profit
• Ration by price and the buyers who value the good the most will get it
• Sellers only need to know the price of the good relative to the amount they'll sell
• Buyers only need to know the price of the good relative to the value they place on the good
• Decentralizing decision making as best as you can is the best way to survive in this complex society
• partial solution is to experiment with different policies not infringed by government
• Rent Control and Price Ceiling
• price ceiling: landlords can't raise the price and renters can't bid higher prices

11/18

• Responses to increased demand
• accept less customers
• rationalize more narrowly
• Advantage of the market and the price system
• don't need police to ensure products aren't stolen/wasted
• we are the product police
• prices compel us to act in our self-interest
• Price System
•  forces us to make a Cost-Benefit Ratio
• we do this naturally without the enforcement of police or a czar
• force us to realize how much others value a product like water
• without this, no way/no signal to tell what people want
• under this, giving supply to people who don't want it opposed to wasting it is unethical and stupid because there will be someone who will value it more and will pay for it
• provides means to obtaining  a product even in shortages
• Black Market sales
• results in zero sum transactions
• legalization of one of these activities, ex: kidney sale, raises unethical incentives
• What determines who gets what
• usually the higher valuer
• exception: health care
• is it possible to make it independent of income
• if it is possible should it be desirable
• if it's not possible why the continued debate
• Meddling with the price system as a means to a solution makes things worse
• Money changes the nature of transactions
• solves the double coincidence of wants problem
• universally accepted currency
• divisible 

11/14

• Supply Curve
• Supply Curve= Marginal Opportunity Costs
• Costs more to make more
• Points represent the cost of producing the unit
• Curve moves up because of diminishing returns
• As Price of good goes up, willing to produce more
• 4 Main Points
• Marginal Cost= each point on the curve
• Total Cost= MC #1 + MC #2 
• Total Revenues=  P x Q
• Producer Surplus (Profits?)
• "Law" of Supply- wages go up and so will production
• false and disproven
• Behavior toward a good changes
• price
• moves along the supply curve
• it's said the quantity supplied changed
• any other factor 
• shifts curve
• ex: any change in input costs
• Expectations matter more for producers
• affect supply by shifting the curve
• prices expected to rise, buy it today
• Technology
• ex: machines, worker skill improvement etc.
• causes movement along supply curve
• Price Elasticity of Supply
• % change in quantity supplied / % change price of this good
• two results
• Relatively Elastic >1
• Relatively Inelastic <1
• Price System is the method for rationing goods

11/7-11/11 reading

The Leisure class has and still is linked to ownership which can be referred to as property rights. Therefore, if this class would have any hierarchy or ranking system, it would be whoever has the most goods is among the leisure elite.  Reputation is defined by what you own, how much, and its quality. Leisure class is also in some ways made by society. I say this meaning that whatever kind of occupation society holds in high honor is usually the highest paid. This is different through history as priests and barbarians used to be dominant in this sense but now are replaced by doctors and lawyers. I would say that in short the leisure class is the class of the privileged or the wealthy, anyone who has an abundance of goods could be part of this class.

11/11/11

• A perfectly inelastic curve, which would be a vertical line, is impossible
• Almost everything has a substitute
• Checks are always split (ex: health care)
• 50 % expenditures government
• 40 % expenditures insurance
• Income and consumption are different from prices and consumption
• Cross-price Elasticity
• pizza price increases, burrito quantity demanded increases"+" substitutes
• pizza price increases, burrito quantity demanded decreases"-" complements
• Income Elasticity: % change in quantity demanded / % change in income
• > 0 = "normal goods"
• < 0 = "inferior goods" 
• Example: Income = $50,000 Environment spending= $500 Elasticity for environment= 2
• income increases by 20%
• environment spending increases by 40%
• $500 + $200 
• 40%(change in quantity demanded) / 20%(change in income) = 2(income elasticity)
• Producers produce more when quantity demanded rises
• they primarily care about the relative opportunity cost
• mountain bike maker vs table maker
• the inputs needed to make the mountain bike have more foregone opportunities which is why mountain bike inputs have more value
• Other costs matter besides price
• Relative Opportunity Costs greatly matter in decisions
• What are Costs?
• they are anything that consumes resources
• however They Have To be Attached to Two Important Factors
• Actions
• a sacrifice must be incurred
• "what does it cost to obtain a college education" is not a complete statement
• To Whom
• "what is the cost of you obtaining a college education" is a complete statement
• distinguishes relative opportunity cost
• Talent vs Opportunity
• the person with more foregone opportunities is more valued (paid more) than someone who is more talented but has less foregone opportunities 
• skilled workers are paid more than unskilled workers only if their skills are valued somewhere else
• Costs and Supply: Quantity Supplied vs Law of Supply
• quantity supplied= amount of a good that firms are willing and able to produce at a particular price
• law of supply = when the price of a good rises, seller will produce more of the good

EWOT week 11/7-11/11

If I have an increase in my income and I decide to buy more pizza and less stamps, then pizza is a normal good to me and stamps are an inferior good to me

11/9/11

• Elasticity
• the equation: %change in quantity demanded/% change in whatever you're interested in
• whatever you're interested in = price, temperature, etc.
• ex: quantity demanded initial = 6 lbs apples
• quantity demanded final = 2 lbs apples
• price initial= $1.50/lb
• price final= $2.00/lb
• [(2-6)/6]/[(2.00-1.50)/1.50]
• What Impacts Elasticity?
• Time
• long-run change in elasticity is greater than the short-run change
• Budget
• goods that make up a small portion has a barely existent elastic change especially compared to those goods which take up a large portion
• Substitutes
• if prices rise for one good, we switch to another
• Elasticity in Picture
• calculate elasticity on the curve using the elasticity equation
• Elasticity Rates
• < 1
• inelastic; not very sensitive to price changes
• 1
• "unit elastic"
• > 1
• elastic; people are very sensitive to price changes
• Which good would be more elastic
• Minivan           Ford Minivan           Red Ford Minivan
• Look at the 3 impact factors: Time, Substitutes, Budget
• More narrowly that you look at a product, the more substitutes you will find
• Time not mentioned therefore not a factor
• Budget is basically the same for all three because they are all minivans
• Answer: Red Ford Minivan
• Reason: More Substitutes available
• Law of Demand
• when  a trade-off becomes worse (more expensive) we do less of something
• using salt as an example 
• cheap; inferior good
• no real substitute 
• there is a price somewhere down the line where you will stop
• for salt, the price would just be much higher
• Total Receipts= P x Q TR= total receipts   P= price   Q= quantity demanded (inverse relationship)
• if P increases, Q decreases
• if P decreases, Q increases
• total receipts is same as total expenditures
• example-
• P= $50 Q= 10 TR= $500
• Then raise P = $80 which lowers Q= 4 So TR= $320
• Expenditures are not the same as costs
• P x Q skyrocketing for health care
•  cost  does NOT equal PxQ

11/7/11

• At each price you sum up the quantities for all people involved to get the market quantity 
• Comparative Statics: what things impact how much we buy?
• Prices of the Good in question
• "Other Stuff"
• if this is the cause, changes the way you think about prices
• aka Changes in Demand 
• Income
• price does not change yet you buy more of the good then demand shifts out
• more income does not mean you'll consume more
• income increases, quantity demanded increases because some goods are perceived as "normal" goods
• normal goods vs. inferior goods
• Prices of other things
• substitutes vs. complements
• ability
• Expectations
• future prospects
• price of substitutes 
• willingness
• 'Tastes'
• # of participants              
• Preferences: subjective by nature
• "Normal" Goods = quantity demanded increases when income increases and quantity demanded decreases when income decreases ( direct relationship)
• "Inferior" Goods = quantity demanded deceases when income increases and quantity demanded increases when income decreases (inverse relationship)
• Substitutes
• replacements
• only classified as substitutes if the relationship between the goods (inverse relationship) contributes to the claim
• Complements
• goods which augment the other; they go together
• hot sauce's price increases, you consume less burritos because you use hot sauce for burritos 
• Elasticity:  How  much more!
• price change effects consumption = elastic
• price change does not effect consumption = inelastic
• anything can be measured in regards to elasticity 
• Own Price Elasticity of Demand
• it is the % change in quantity demanded/ % change in price 
• ex: 50%/25% = 2                                                  

week 10/31- 11/4 EWOT

The 10th anniversary remake of Halo is out and I really want this game but its price is $60. I know that most video games when released cost generally $50-60 for a short time and then they lower the price. I really want the game but I am unwilling to pay the price so I will purchase the game when its price falls to $40 or $30

week 10/31- 11/4 reading

In RA Radford's The Economic Organization of a P.O.W. Camp, it is stated that the social norms that transpire in the free world are but the same in P.O.W. camps. Each prisoner holds the prison group to be of a vital importance for their futures but are aware that the outside world remains unaffected by the social group of their prison. What we take granted such as razor blades, cigarettes, or writing paper is wanted by prisoners in a level of urgency that is far higher than the norm. This makes trade among them nothing other than essential.  The essential factor comes from the fact that prison economy arises from a response to needs and wants rather than an imitation of another country. Prison economy is very small and simplistic, very enviable qualities for an economy, but is mostly sociological dealing through bartering. Cigarettes are the currency of the land and is usually traded for food(or another cigarette brand sometimes). Later on, "goodwill" became a market method to leave your cell with a certain amount of food and return with more than you left with. Their market is not perfect as increase in volume would result in very rough trade scales. Cigarettes continued to be the currency until around D-Day when the people who owned/helped the POW camp decided to host a restaurant and established paper currency for the restaurant. It worked relatively well with no loss of market value. Price fixing and changes stirred public opinion, deemed unfair to those with few cigarettes, forcing prices to shift in accordance with cigarette supply. In summary, 1944 it started out very well. However, deflation and cigarette shortage in 1945, left things in an unknown state. From that point on, economics was the science of distributing limited means among unlimited and competing ends. This lasted until it was agreed that with infinite materials, economics has no place.
Short Main Lessons from reading

• trade-offs can occur anywhere
• money is not the only currency by any means
• an organized economic system can arise in response to a group's wants/needs
• whether we're aware of this or not, we will use economics to obtain goods so long as scarcity exists

11/4/11

• Every trade-off causes people to act differently after the fact
• When the price is too high, you are either not willing or unable
• You usually never buy the good; you buy the services that can be obtained from the good
• There is no correct way to consume something
• Prices force you to..
•  Prioritize what you want
• Think about values
•  Think about everyone else's values
• Why do I purchase less of something when it becomes more expensive? (Why do demand curves slope down?)
• Wealth Effects
• prices increase, you're poorer
• when poorer, you consume less
• Substitution Availability
• Diminishing Marginal 'Utility'
• each purchased good provides less satisfaction than the previous one
• What can be obtained from a chart?
• Marginal Values
• Total Expenditures
• amount of good x price of good
• Total Values
• "Buyers' 'Net' Gains"(Consumer Surplus)

11/2/11

• Price
• signal to buyers about scarcity
• signal to sellers about value
• information
• emerges from markets
• Information Problem
• with the exception of a small group, it's extremely difficult to ascertain what people want
• if you figure out what is wanted, you then need to find out how to obtain it
• Markets
• any decentralized, unorganized interaction between potential buyers and sellers
• $ prices and/or non-$ prices emerge
• the goal of a market is to produce order
• order = commodities on the shelf
• market process is where a price is determined
• buyers
• "demanders"= households and firms
• households buy goods
• firms buy services (ex: labor)
• sellers
• "suppliers" = firms and households
• firms supply households with goods and services
• households supply firms with money and labor
• Perfect competition
• no one really wants it
• it's the process that matters
• Transactions
• regular transactions don't effect prices for other people
• Demand
• relationship between desired amount of a good and sacrifices necessary to obtain said good
• quality demand = amount of a good that buyers are willing able to consume at a particular price
• law of demand = quantity of a good falls when its demand rises

10/31/11

• Global Trade
• More commodities can be made in different places
• Productivity is more efficient and faster
• Beneficial environmental impacts terms of land usage
• What makes trade beneficial
• Smithian notions
• Specialization results in less time spent learning and more time spent producing/resting
• Specialization involves more time devoted to the specific field
• Specialization allows an extended market
• Recardian notions
• Comparative advantage lowers production costs
• Transactions Costs
• definition: cost of negotiating costs and agreements
• 3 main costs
• Physical
• Insurance of Opportunity
• what is given up for what is chosen
• Interference 

week 10/24-28 reading

• Mike Rowe from Dirty Jobs on roadkill, castrating animals and how “ necessary” labor is belittled by our American attitudes. Keep this in mind when you hear claims that “everyone should go to college.”
•  not everyone is tailored for college
• specialization indicates that every career can be necessary
• Long Live Roquefort
• people value roquefort as much as (if not more than) the imposed 300% tariff
• the substantially sized tariff is a method that is akin to the old mercantalist methods of restricting free trade
• Who Wants Their Kid To Grow Up to Roll Cigars? 
• richness is subjective
• in some economies, a bad job is better than none

EWOT week 10/24 -10/28

I can make 8 free-throws in a row and 24 lay-ups in a row. A friend of mine can only make 3 free-throws in a row and 6 lay-ups in a row. In terms of basketball prowess, I can definitely make more free-throws and lay-ups than said friend.  However, from an economic standpoint, my friend has a comparative advantage in making free-throws over me as the data below shows.

• Price of 1 Lay-up
• Me: 1/3 free-throw
• My friend: 1/2 free-throw
• Price of 1 Free-throw
• Me: 3 lay-ups
• My friend: 2 lay-ups 

10/28/11

• Trade Surpluses do NOT create jobs
• Imports are paid for via exports

10/26/11

• Mechanization/outsourcing really only occurs with the inferior jobs
• Every month in the US, 4 million jobs are created countered by 4 million being destroyed
• Self-sufficiency is the road to poverty
• Trade doesn't cause jobs; it merely changes the type of jobs in the industry
• Trade Deficit = imports > exports
• Trade Deficit = exports > imports
• Myth: America doesn't make anything anymore
• jobs must complement capital
• labor and capital can't be substitutes
• machines can't do everything labor can do (unless the singularity happens)

10/24/11

• Price = what is traded off
• Who's "more efficient" at making each good?
• really means who incurs the smaller trade-off
• What is sacrificed?
• (10 wines 5 cameras) Rochester: Price of 1 camera = 2 wines  Price of 1 wine = 1/2 camera
• (3 wines 4 cameras) Cornell: Price of 1 camera = 3/4 wine  Price of 1 wine = 4/3 camera
• Therefore, Rochester has a "comparative advantage" in making wine over Cornell
• comparative advantage = ability to produce something giving up less resources than other producers
• No producer can have a comparative advantage in producing everything
• Cornell has a comparative advantage in making cameras over Rochester
•    You pay for your imports with your exports always
• What matters in trade is the relative price differences within a country
• Policies that restrict trade make people poor
• Two ways for states to get rich
• have almost everyone working
• improve the productivity of every worker in the state
• the better option
• Why are there less jobs today
• technology replaces workers
• many products need technological production
• low paying jobs fill up fast or get offshored 

10/21

• Trade
• creates wealth although nothing new is created
• non-technical form of production
• enables people to know what they value
• Efficiency
• utilization of your stock of resources to get more done faster
• Production Possibilities Frontier
• all possible combinations of goods that can be produced given the following: level of education, amount of resources, and access to technology
• Properties
• All points on/in the curve is achievable
• Absolute advantage: more efficient(larger number) on x-axis ,or y-axis, or both
• All points to the NE are NOT achievable
• Points on the PPF are "productively efficient"
• economically efficient is not just producing at lowest cost but also producing what the people want
• Slope
• captures trade-offs between amount of the good on x-axis and amount of the good on y-axis
• Change in Slope
• "Law of Diminishing Returns"(law of increasing opportunity costs)
• next produced good is more costly than the previous one
• ex: teachers taken from education field into medical field results in worse quality of doctors and each teacher that the education field loses was better than the last
• Economic Growth
• 3 factors
• Resources 
• Technology
• Trade
• Comparative Advantage
• ex: two groups that only make the same two products
• Rochester: 10 bottles wine/yr 5 cameras/yr
• Cornell: 5 bottles wine/yr 4 cameras/yr

week 7 10/17-10/21 EWOT

most people at the university don't steal from each other or fight each other because they generally coexist according to the silver rule

week 7 10/17-10/21 reading economics of property rights

For any society, the right to own private property is essential. Private property grants you control over how to use your resources, what to use them for, and right of exchange over your property. However, the barriers to everyone having private property exist due to scarcity. In addition, we can neither support ourselves entirely on just effort nor can we have the same goals for land as others do. Typically, property disputes are resolved with some form of negotiation or competition. The alternative,being violence, is too expensive to be a permanent resort. I think that although negotiation and competition do not always work their rate of success is far higher than that of violence. Besides, violence having a place in your affairs could conceivably set a dangerous precedent. Some would say that private property being taken care of via competition/trade is selfish. I'd argue that this accusation is false. There is but three main methods of getting what you want from someone: love, trade, or force. Love is too ideal to work for a sufficient amount of time and violence usually ends up finishing whoever is involved whether they were an aggressor or a victim. This leaves us with trade, a method with a sufficient success rate. I know that there will always be classes that are richer than the others but everyone as individuals deserve the chance of owning private property. This is derived from the enlightenment thinking of John Locke. This is opposed to communism which believes the state should own everything. A failed method this is as it strips much incentive away from the working population to work extremely efficient if their extra effort will be awarded the same as regular or sub-par. In our society, property rights are a form of human rights which are inseparable from property rights. For example, right to free speech is the property right to hire an assembly or own one. These rights, property rights, are a realization of the conditions needed to facilitate further existence as a human being

10/19/11

• Confidence is a pivotal asset in everyday trade and work.
• you don't undergo a trade-off with other people if you don't have at the very least some semblance of confidence that the trade-off will go well
• Feedback Loop
• competition serves as an incentive to corporations to keep up the good work or another business will take its place
• doesn't work if people become apathetic
• Trade and Exchange
• basic economic questions derived from scarcity
• what gets produced
• how does it get produced
• allocation of said thing produced
• inputs-----black box---------"stuff"
• process of creating more economic resources
• two pre-requirements
• self-sufficiency
• specialization and exchange
• Factors of Production (inputs)
• land
• any preexisting physical object
• labor
• number of bodies
• capital
• what must be first produced to produce something else
• two kinds
• physical
• human-anything done to augment natural abilities
• Economic Activity
• depends on PSST- Pattern of Sustaining Specialization and Trade
• order of sequence
• specialization
• exchange
• discovery
• less GDP is gathered when people do things for themselves
• an economic slump can be caused by rapid emergence of new technology 
• trade is "good"
• biggest economic consensus
• some disagree thinking
• nothing new is created
• some get exploited
• wealth is whatever people value
• real economic growth happens with increased production of wealth
• voluntary exchange only happens when the values differ
• people trade to get more of what they value

10/17/11

• Golden Rule
• the main ideal for any and all marketplaces
• does not work well in practice
• fails not due to selfishness but because not one of us is omniscient
• we don't know what other people want
• Most benefit is self-benefit
• even compromising fairly can be product of motivation for self gain
• Reciprocal Altruism
• selfless act to assist others in hopes of promoting a society that functions in the same manner
• Self-interest
• pursuing the project that interests you
• Silver Rule
• do not do to others what you would consider unfair or unjust if they did it to you
• for dealing with commercial strangers; responsible for garnering much products

EWOT week 6

Should I decide to go to a buffet, it's best not to overindulge to obtain my money's worth because either way it remains a sunk cost

10/14/11

• Worker's Wages
• roughly in direct correlation with worker's productivity
• $25/hr then the worker's wage should be about $25
• Price System
• promotes better outcomes for the economic market than it would have without utilizing the price system
• Markets Often Don't Work Well
• "Lack of Existence"
• markets don't exist in certain situations
• ex: you wouldn't pay someone a dollar to go away because he/she was being irritable
• Institutions 
• "Efficiency"
• delivering what people want
• at lowest possible cost
• all the formal and informal mechanisms that we use to live peacefully with each other
• formal- legislation
• informal- customs
• ex: good law firm, legal system, government
• rule of law
• laws cannot be arbitrary
• everyone treated equally
• good laws must be general not specific
• Markets work well when both sides (buyer and consumer) have many options to consider
• Inflation
• general increase in ALL prices including wages
• caused when too much money is in circulation 
• Ethics in Economics
• free societies work better when they're honest
• cooperation between people is generally positive sum
• better morally for people to work for interests of others
• taken from the Golden Rule 

10/12/11

• Unintended consequences
• identify parties who would respond
• changes incentives which results in push-back from all sides
• slave trader ex: british navy's attempt to stop this made the slave trade much more horrific such as drowning slaves or putting their heads on pikes in response
• simple rules trying to regulate society.. the problems
• limited info
• poor and mitigated incentives
• little feedback
• Trade is NOT Zero Sum "pie fallacy"
• pie fallacy- thinking that there is a fixed amount of wealth and someone is getting a bigger piece of the pie
• benefits both sides; if one's got more benefit than it's exploitation
•  notion that market is a necessary evil is false
• zero sum can stagnate economic growth
• wealth "stock" vs. income "flow measure"
• Recitation Sunk cost
• bidding game example: you should pay as much as you can because after you first bid you've incurred a sunk cost whether you bid more or not
• focus on marginal cost (increments) when making decisions 
• not sunk cost

week 6 reading "the case for contamination"

Change is inevitable, the way humans are designed to live. History is proof of this as civilizations have risen and fallen in almost direct correlation to the world modernizing and changing. You can't stop it or keep others away from its residual effects. They are entitled to their own opinion of adapting to change their way just as you are entitled to holding on to the traditions of the past. There exists a cycle in which cultures will gain new differences as they lose old ones. I agree with this because I think that mankind has a way of maintaining a proportional balance. Obviously, many differences are prevalent between today and 100 years ago. However, at the core the main issues such as wealth, power, class, and culture remain. What we use to determine and argue these differences are different but the issues that are prevalent have never left. Just as these issues remain so will cultures. Liberty and diversity are sometimes at odds. This is why there is no definite path to take. More like a compromise to be made between the preservationists and the globalizationists. It's almost inconceivable to completely abandon and forsake one's cultures and roots but it is also unwise to reject the modernization and benefits that global advances can bring. Since no one would give up either of these things understanding is needed. You don't have to agree in order to be individualistic and maintain your own culture. Global ethics has to maintain a balance between respect for individual freedom and respect for difference. The key is to not let one overtake the other.

10/7/11

• Use vs. Exchange
• teachers vs. athletes: the relative scarcity is different
• teachers are much more abundant than athletes are
• because of this abundance, we don't value the next teacher more than an athlete
• relative scarcity plays a huge role in determining prices and wages
• total use vs. marginal exchange is a same but different concept
• valuse at margin are very context dependent
• value arises from human interpretation
• Sunk Costs
• sunk cost- cost in which resources are non-recoverable when a decision is made
• not factored into decision
• Humans act with Purpose
• we tend to do things in life to ease off our burdens
• People respond to Incentives
• your behavior will (always) change when the benefits and costs change
• Law of Unintendded Consequences: because people respond to change, there always unseen consequences that reveal themselves some time after a decision is made
• example: seat-belts- changes the cost of getting an accident by lowering it, however, this raises the quantity of accidents making driving more dangerous 

Final Review for Midterm 1

• Specie-flow mechanism: thought that importing goods meant transferring your gold
• Problem with collectivist society
• no way central planners can know what everyone wants: no tacit knowledge
• no specialization which leads to an information problem
• Competition
• to get best employees, wages will eventually have to rise
• Hume's negative effects of restrictive trading policies
• loss of competition
• loss of innovation
• loss of division of labor
• Emergent Order
• everything is created from human action not human design
• 'spontaneous order'; no central planner
• Knowledge Issue
• no one person can know what people want or need
• Living Standards Better Today
• Big Variety of Goods in account to provide Substitutes
• Services are what matter not the goods obtaining them
• Quality of goods have increased
• Illumination example: candles about same cost but you can get a greater amount of light at a cheaper cost
• Feedback Loop
• businesses have an incentive to make consumers happy so they in turn will have an incentive to come back
• Who designed modern market system? 
• No One; there have never been any central planners
• Schumpeter and Marx's view of Capitalism's achievements
• more products available at a cheaper price
• Zero Sum
• your gain is my loss, your loss is my gain (a gain at someone's expense)
• Opportunity Cost
• net benefit of the next best thing that you forego for what you chose
• Broken Window Fallacy
• hurricanes can boost the economy through stimulating jobs
• these jobs are merely allocated to something that was already there rather than constructing something else
• Costs
• consumes resources
• genuine = marginal- changes after decision is made
• sunk- cannot be recovered

10/3-10/8 (week 5) EWOT

After attending two review sessions for the econ midterm, I underwent an opportunity cost of loss of time for either recreation or studying for other classes. The benefit of course is more econ knowledge, but the trade-off is the lost time which is a sunk cost

First Midterm Review

• Incentives
• motivation for doing something; not only money
• Values
• subjective
• products' value dependent on consumer interest
• Specialization
• what skills people specialize in
• without this there's an information problem
• driving force for division of labor- different activities needed to produce commodities 
• some fear specialization because(giving up self-sufficiency) because your specialization is dependent on a number of others
• Feedback loop
• give consumers an incentive to come back as a result of the consumers' business as an incentive
• Price System
• scarcity determines prices
• act as signals carrying information about the scarcity of an item
• Wealth
• no set wealth in the world
• direct relationship with prices
• Costs
• marginal cost- change in cost incurred by decision
• sunk cost- cost that cannot be recovered
• richer now so education and health care costs more
• cost- something that consumes resources
• Living Standards
• can only change through an increase/decrease of ability to produce/exchange
• when increased, there's more money to spend on things such as education

10/5/11

• Broken Window: 3 problems with the notion of the "stimulating" effect
• I didn't choose the roof (broken item to be repaired) in the first place
• people forced to lose $ on commodities that they already had
• we all become poorer by the $ amount needed for repair
• We lose the value of the Resources used to repair roof
• Forget $, Resources are essential
• All of the workers and tools used to repair roof  are taken from being useful elsewhere
• the tools and supplies and workers could've been needed elsewhere
• However: "..what if the roofer was unemployed?"
• Raising taxes leads to jobs being lost
• Resources have to be spent to create jobs
• Jobs are a Cost
• Benefit- paid income
• Cons
• Work in place of recreational time
• Resources used to create job
• World War II and the Broken Window Fallacy
• Consumption levels on average fell steadily for years
• Ability to consume resources fell
• Didn't improve consumer living standards
• Cost is Subjective
• worth of what is given up is different for each person
• cost given up to make a decision is unseen
• Marginal Analysis
• should i do x or y; should i do more of x or less of x
• water-diamond paradox
• something high in value and use has a low price
• something that's useless but has a high exchange value has a high price
• firms that make the best decisions think about margins
• 200 seat plane, total cost $100,000, average cost $500
• should they charge you less than $500 for tickets
• absolutely; they've spent $100,000 for the ride whether they have 100 or 200 passengers
• Marginal cost- the change in your cost from taking the action

10/3/11

• Basic Economic Principles
• How people make decisions(today's lesson)
• How people interact
• How "aggregates" work(i.e. the economy)
• People face trade-offs
• Any decision which involves cost
• Economic efficiency vs. economic equity
• Reveal what a person values and how much
• To be truly free
• to produce and consume without using resources 
• someone pays for it and/or something is done for it
• Is anything on earth free?
• Drug Lag
• many years to test drugs and their efficiency before it's sold
• many people who needed it are dead by the time it's on market
• Drug Loss
• $50 billion on medicinal research annually
• about 20 new medicine are produced annually
• testing is costly and means less opportunity for pharmacy
• Cost = anything that consumes resources
• question to ask: which resources used will disappear and/or were resources prevented to come into use
• taxes are not a cost; cuts and raises are forms of transfer
• Opportunity Costs
• opportunity cost = net value of what you lost from your next best opportunity 
• what you gave up to do something else
• buying a lemon instead of a lime; the cost is the missed pleasure of eating the lime
• Example problem: You win a Bruce Springsteen Concert ticket 
• can't be resold
• only other opportunity is Barry Manilow concert
• $40 ticket
• $50 worth of pleasure
• opportunity cost of going to see Bruce instead of Barry is $10
• Applications: Broken Window
• No new jobs are created
• People at large become poorer at the amount of the damage
• Marginal Analysis 
• application: subjection
• Sunk Costs
• People Respond to Incentives 

EWOT week 4

In society's structure, consumers and businesses are inevitably independent on each other, and the government comes into play by not controlling the market while on the same time keeping it in check

week 5 reading; should government support the arts

• Pros of subsidies to the arts
• broaden the soul of a nation
• focus less on materials and more on morals, customs, and manners
• heightens industry ex: France
• Cons of subsidies to the arts
• takes subsidies away from other institutions like museums and universities 
• would harm cycle of needs and desires alternate in terms of primary use
• Opposing subsidies for something does not mean you oppose said thing
• simply means they should generate their own money
• Where do subsidies go?
• (visible side) they go to the main workers and employees and employers
• Where could they have gone?
• (invisible side) aid taxpayers whose wallets the money came; beyond that is comjecture
• Public spending
• results in relocations not gains
• benefits one worker in place of another
• substitution for private spending
• adds nothing to the working class as a whole

9/30/11

• Adam Smith's View of Government's Positive Roles in Laissez Faire
• Police and Courts for domestic defense
• National Defense
• Public Works
• Adam Smith's View on Citizens' Rights
• Rights to Property
• Division of Labor
• Exchange is peaceful and mutual
• No special privilege
• Source of Wealth according to Smith
• Production and Exchange
• Prevent certain elements from marketplace
• any attempt to control prices
• unfair taxes(not fair taxes)
• disability to buy what I want when I want from whom I want
• Spontaneous Order
• Ferguson (1767)
• first recent moral philosopher to discuss order
• people want to make their lives easier to get what they want
• Corn Laws
• started early 19th century
• impose sliding taxes on imported corn (grain)
• passed so elites could continue to rake in the money from their inflated corn
• repealed mid 19th century
• Fastest Economic period of Growth
• late 19th century
• England had a far higher manufacturing rate than any country
• This prompted many countries to lower trade barriers
• More capitalist a country, the less important is capital
• Capitalism provides for more opportunities 

9/28 recitation

• played Ultimatum game
• what is greed?
• higher level of self-interest that occurs when one goes too far
• an excessive desire for more
• why do you expect wegmans not to poison you?
• the Feedback Loop
• the consumers' money gives the business an incentive to make them happy so they will come back to them again

9/26 week reading: the debate

• there were many statistics that showed that the richer countries were the happier
• many facets of everyday life were seen with more satisfaction among the citizens of the richer countries
• however, there were also examples that showed how quality beat quantity
• ex: people would rather be the commoners in the land of the rich than the richest of the poor
• changing the question asked to the people being surveyed kept the results essentially the same
• ex: Japan did this and although its people were becoming happier, the surveys indicated otherwise

9/28/11

• Circular Flow of Economy
• Two groups: People and Businesses
• Factor Market
• People send "stuff" in exchange for money so businesses can make their products
• "stuff"= labor, capital, machinery etc.
• "Goods" Market
• People pay businesses for their products
•  Income = Expenditures
• Increase in Expenditures will have to lead to increase in income
• Consumers can consume
• Consumers can invest
• Government can purchase materials
• Individuals can't be self-sufficient at least not successfully 
• Pysiocrats' Source of Wealth
• Agriculture was source of wealth
• Mercantilists' Sources of Wealth
• Gold in treasury
• more gold produced more means to execute war
• Wealth/Finances of the King
• king's purpose is to produce a positive balance of trade
• Positive Balance of Trade
• Arguments against other sources
• trade is zero-sum(giver is loser and receiver is winner)
• the King should control trade
• Restrict Imports
• Promote Exports
• NO Free Trade
• money is wealth 
• Is Capitalisim compatible with justice?
• 'conforms to some preexisting notion of goodness'
• Hume
• even more prominent than adam smith
• most widely read author among the founding fathers
• rejected that the source of wealth is agriculture
• scared that jealousy would prevent us from trading's benefits
• Hume's Source of Wealth
• Commerce
• Specie-flow mechanism: Law of One Price 
• amount of money relative to amount of goods in circulation 
• Hume's Important Elements
• Competition 
• separates the weaker from the stronger
• "trabant" example a car made only in east germany
• Learning and Innovation 
• learn from failed attempts of other countries
• Division of Labor
• unattainable without  a lot of trade
• Idea: Economies of Scale
• you wouldn't use more resources than a task required
• Prices change when money goes in and out
• England's prices inflate, British buy French goods, French prices go up and English prices go back down

9/26/11

• Direct Causes of IR
• Emergence of a Business Class
• Entrepreneur
• Increase in Technology Improves Worker Productivity
• Wages Rising improves technology or is derived from improved technology 
• IR was one of the first times we started to value peer collaboration
• Institutions
• Adam Smith argued they are the most important factor for growth
• Duty has transformed to people high up on the hierarchical ladder to ourselves
• Mercantilism
• 'progressive corporatism'
• heavy restraints on indivduals imposed by states
• craft guilds
• licensing, government granted monopoly
• restriction on the free movement of people
• Two major groups
• French Physiocrats
• Scottish Moral Philosophers
• Quesnay
• Circular Flow
• stuff going between individuals and firma

EWOT for week 9/19-9/23

Many arguments that we are destroying the earth and its resources are unfounded. Many resources are plentiful and in actuality bodies of water and air are both cleaner. These accomplishments are accompanied with greater income and riches for everyone as a whole in comparison with the past. However, greater incomes does not lead to happiness and many today serve as living proof.

9/23/11

• Is the natural world better or worse?
• Bodies of water and air in America and Europe are cleaner
•  Resources are more plentiful than in the past globally
• Takes less land to produce more crops
• Forests are larger than 60 years ago
• Has becoming richer made us happier?
• Layard did a study:in some places where people have incomes beyond 15Gs, they don't become happier with more dollars
• Happiness has been seen to arise from social and political gains
• No concrete correlation between increased incomes and happiness
• GDP per capita growth
• Highest growth was during 1950-1973 at 2.5% growth
• 2000-2010 has been the Developing World's Best Decade Ever
• Industrial Revolution = Commercial Revolution
• Transition period from no change to accelerated change
• Countries affected differently from each other
• Economic growth=Extensive growth= population becomes richer but individuals not affected
• Classical Theory
• More people leads to faster usage of productivity
• Modern Theory
• Advancements in tech. knowledge, and human capital allows productivity to outrun population
• Child quality vs. child quantity
• net transfer from older to younger generation
• Fertility rates
• rate=2 .1
• Falling across the world
• Poor countries' rate went from 6 to 3
• Europe's rate halved
• Most of the world only meets the replacement rate now
• If it continues, population will be at 9 billion by mid century
• Intellectual Stepping Stones of the IR
• Chinese invented printing press
• Romans invented first steam engine
• 
  

Recitation 9/21/11

• Recap: comparative advantage=competitive advantage=specialization
• Facts help us decide how much of a resource is needed
• People know economics;they just don't know the right stuff
• Ideas are usually held by people who are not affected by what the idea's about because there's no cost to them
• What is done depends on the concepts and view of the people in question
• When we put a price floor, companies need to pay their employees more money
• With minimum wage comes high cost which is not necessarily a good thing
• High cost leads to unemployment
• Feedback Loop- consumers can trust companies because they need to provide the consumer service to ensure the possibility of their coming back
• Minimum Wage causes:
• Unemployment
• Worse Working Conditions
• Less Benefits

9/21/11

• Income
• 1790- 91% spent on necessities
• 1900- 72% on necessities
• Today- 35% on necessities
• We're richer today because we can spend double on whatever income we garner on nice stuff 
•  Major Income Inclinations
• Primarily Risk
• Income Elasticity of Demand
• prime example would be spent amount on luxuries
• "Freed-Up" Wealth gets us..
• Bureaucrats
• Bombs
• Bailouts
• Government's Scope in the Market has grown significantly over the past century
• Commodities
• they themselves don't matter
• the services that the commodity provides matters

Main Points 9/19/11

• Mankind has been constantly improving itself
• Death rates for major diseases falling
• Physical Stature increasing
• Nutrition Rates increasing
• The Flynn Effect, increase in cognitive utilization, is on the rise
• Health care improvement
• These Improvements are significant
• Mankind's population growing
• World becoming richer
• strong correlation between richness and longer length of life
• People living longer
• American Living Standards (Past and Present)
• Workweeks are shorter 
• Vacations are more plentiful
• Commutes are longer
• Retirement did not exist
• Women were only 18% of workforce; now 50%
• Income
• Average Per Capita income 100 years ago $7000
• Average Per Capita income now $45,000
• Effort
• less needed today to buy more
• counter example
• piper-club plane cost $25,000 in our money
• costs $120,000 today
• Time dedicated to work has fallen
• lower than Europe

EWOT week 9/12

• Living standards have never ever been nearly better than how they are now
• Technological advancements are a major key to the doorway of societal betterment
• The rise of the middle class has significantly improved standards of living

Main points 9/16/11

• Generally, everyone on the planet was dirt poor
• Farming rates incredibly high 80% to today's below 2%
• What about the past's incredible achievements, the natural wonders?
• most of the people were serfs, a rank barely above a slave
• they were obligated to construct buildings and give 30% of their wealth to the kings
• serfs' wealth and work went to the building of the monuments 
• No one has seen anything to compare with the work accomplished by 20th century western democracies
• Some of the rich and famous of the past died of causes that could be easily cured today
• Internet gives us access to a plethora of material resources
• Poorer peasants' experience
• Lucky to have pit privies: same streams to drink from that animals bathed and both animals and humans defecated in
• Only had wood
• took miles and hours per day to collect
• Inadequate Housing
• Early Urbanites' experience
• Travel via Horse
• 22 pounds of manure per day
• Trash thrown into streets
• 1/3 of agricultural land to feed horses
• Life Expectancy has risen since the 18th century to now for almost all countries
• 1/3 deaths were due to hunger 
• Much healthier today we are

Industrial Revolution- Recitation

• It takes a great deal of effort to manufacture and supply even the most basic of products
• We're better off today because we don't have to be self-sufficient anymore
• many corporations and companies can supply us with what we need
• 5 Reasons for Industrial Revolution
• Laissez Faire
• Rise of Entrepeneurs
• International Gold Standard
• Mobility of capital and labor
• Ability to take advantage of the world wide division of labor and the competitive advantage that accompanies it
• competitive advantage- what you can specialize in
• free to do more, we are
• Present day America, mercantilism is practiced
• Past Britain, little incentive was there and there was no free trade
• no specializations
• everyone worked on their own
• Why was England able to industrialize
• its liberal environment
• individual rights=extraordinary leap of energy
• individual man was free to create, innovate and enterprise without government interference
• social and economic mobility became easy for the business man as the social and economic barriers were lowered
• Rich got richer, but the poor got much better than before
• Invisible Hand
• Standards of Living
• Increased
• Everyone got richer
• Globalization allows us to extend knowledge across the world
• Without trade and specialization, we lose competition, learning, and innovation

Main Points 9/14/11

• First 1000 years A.D. income stayed stagnant and living standards did not improve
• literacy fell on a wide scale
• deurbanized
• extremely low GDP growth
• Technological advancements alone does not at all guarantee economic growth
• tech for steam engine was available during year 1000 
• Pre- Industrial Revolution there was no middle class
• Growth rate increase since 1800 has been incredible (about 1 %- 3 %)
• World production has grown much faster than world population
• Extensive growth is technological advancements designed to support people not improve living standards
• Through time, monetary inequality has risen
• 1870, USA 9x richer than poorest countries; Today, USA 75x richer than poorest countries
• 80% reduction in poverty in last 40 years
• How different are some of the rich and poor today
• functionality vs causality

Class 5: Economic Advancement from the Stone Age to the Technological Era

• People have looked frustrated to economics for explicit reasons to why things occur the way they do in the economic field; however, there is no explicit intention or reasoning
• Impersonality 
• Prevalent in most if not all commercial activities today
• A main reason why some people are nostalgic for the past
• Self-interest
• Everyday, skills are traded for benefits
• Money or time is invested for personal gain primarily
• Cognitive Issue
• Practicality
• The cost of producing far outweighs the cost of sale
• Who gave the orders?
• Nobody, most commercial activities are made up of many interconnecting threads
• Everyone in the chain of events cooperate for the end results
• Invisible Hand
• possibility for people to cooperate for self-betterment with no one giving orders and without the need for coercion
• Tacit Knowledge
• how things are done in a uniquely known way that could not be done by someone else
• allowing people with the information and incentive to work on it
• Price System
• price is a way of telling how scarce something is
• a method of knowing the terms of exchange
• no one sets the prices
• Are we better off today?
• expecting improvement is astounding
• asking the question is impressive
• differences between 1000 A.D. and 0 A.D. are actually negligible 
•  We live in a world of immense inequality
• USA produces over 50X the poorest countries and 15X typical poor country
• GDP measures money produced inside USA's borders
• Not everything produced is valuable and not everything valuable is produced
• Stone Age
• everyone was stone-cold poor
• for many millenia, no advancements were made
• now, world's richness doubles in 15 years

The Economic Revolution , the Worldly Philosophers, by Heilbroner

Mankind is by nature self-centered. Nevertheless, societal needs ,such as hunger, push us together to accomplish tasks that could not be done by ourselves. This has established societal norms like kinship and collaboration. To ensure the continuation of society, man has made traditions for the next generation to go into careers in which they can utilize their selective skills. Centuries upon centuries, mankind was never in need of economists in spite of various economic scales of wealth. Later on, economists devised the market system in which each person could do that which was to his/her best monetary advantage.  The market system marked the beginning of the modern world's most important revolution. The incentive of financial gain proved to be better than that of authoritarian rule. The very idea of gaining profit to have a surplus is actually modern and had no system or base in history beforehand. For people who had any form of capitalism in mind, society's answer was societal exile. A market system is more than simply exchanging goods. It is a mechanism for sustaining and maintaining a society(Heilbroner 27). There was virtually nothing for any sort of economist to do in the Middle Ages and the short span of time that followed in the pre-Capitalist era. To make your own path or bring about change was inconceivable because it was viewed as unimportant and irrelevant. The foremost causes that brought about the possibility of the modern market system are the following: spark in scientific curiosity, new political leadership,  and emergence from the dark ages. From those stepping stones, man began to delve into the principles of gain and profit. With the help of leaders who were akin to economists such as Adam Smith, great advances in ideologies and foundations were made to construct the modern workplace society in which we all live in today.

EWOT for week 1

The world is run by incentives ,and trade-offs are rampant whether they are visible or not. In almost every aspect of a person's life, economic thinking is evident. Everyone ,regardless of being aware of this or not, makes cost effective decisions based on benefits vs costs. Even in mundane decisions, this line of thought is prevalent. Today, efficiency has never been higher ,yet at times, people disregard or forget important concepts such as every decision has repercussions and good intentions do not equate nor do they justify bad results. Mankind acts purposefully. In every era, especially this one, no one has ever greatly committed himself/herself to a cause or process that he/she does not understand or support.

Main Points Day 4

• Microeconomics is analyzing individual decisions
• Macroeconomics is the study of the unforeseen consequences of those individual decisions 
• The reason to study economics is to know how the economy works and to identify what disrupts it
• Why should anyone study Economics
• Provides a way of awe
• Understanding concepts are important
• Knowing the facts are important
• Trade-offs are rampant in this age
• Today...
• Important concepts are misunderstood
• It's possible to collapse time and space incredibly
• Intentions do NOT equate Results
• 2.3% of Americans earn minimum wage
• Economics is not complex; Economic Systems are
• People can have a Type C or Type M brain
• Type C are scientific and analyze situations firstr
• Type M are emotional or motivation driven

Basic Economics by Sowell: Chapter 1

• Scarcity of resources is an issue at the heart of economics
• Resources with alternative uses are the prime source
• Alternative uses make it harder to properly decide resource utilization
• Allocation of scarce resources is the study of economics

Hazlitt's Economics in One Lesson: Chapter 1

• A presiding economic fallacy today is to overlook the consequences of a decision for all groups involved
• It's all too easy to overlook the important long-term effects of decisions
• In accordance with the arts of economics, it is wise and keen to make decisions with both long-term and immediate effects for all groups effected not just a select few

Key Points day 3

• In this world of scarcity, trade-offs are essential
• To economize is to weigh the benefits and costs of decisions, a rational thought process
• All values and costs are subjective
• Economics is about prudence and temperance as well
• Economics is the study of the emergence of order and wealth creation and the consequences of choices made in order to ascertain the progression of mankind's society
• Microeconomics studies unforeseen consequences of decisions for everyone
• Macroeconomics studies with consequences of decisions in the long-term scale such as if the government banned the sale of kidneys, incentive to sell them would fall rapidly

Key Points (days 1-2)

• Incentive is a fundamental key in economics
• Scarcity of resources is at the economical core
• Allocation of scarce resources, especially the ones with alternative uses, is imperative
• Focusing solely on immediate effects of decisions for select groups is very ill-advised.
• Immediate and Long-Term effects have to be focused on for all the groups that the decision entails

Personal Web Site Completed

That didn't take a substantial amount of time at all. Objective completed. I will now acknowledge said completion in 3 different languages for fun.
                                                                     I did it
                                                                     Lo hice
                                                                     Yah tah