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naked chapters - Chapter 1"Economists sometimes ask"Who...

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Chapter 1: “Economists sometimes ask, “Who feeds Paris?”- a rhetorical way of drawing attention to the mind-numbing array things happening every moment of every day to make the modern economy work. Somehow the right amount of fresh tuna makes it way from a fishing fleet in the South Pacific to a restaurant on the Rue de Rivoli. A neighborhood fruit vendor has exactly what his customers want every morning – from coffee to fresh papayas – even though those products come from ten or fifteen different countries. In short, a complex economy involves billions of transactions every day, the vast majority of which happen without any direct government involvement. And it is not just that things get done; our lives grow steadily better in the process. It is remarkable enough that we can now shop for a television twenty-four hours a day from the comfort of our own home; it is equally amazing that in 1971 a twenty-five inch color television set cost an average worker 174 hours of wages. Today, a twenty-five inch color television set – one that is more dependable, gets more channels, and has better reception – costs the average worker about twenty-three hours of pay.” (Page 4, paragraph 2) Chapter 2: Communal resources, on the other hand, present some unique problems. First, the villagers who live in close proximity to these majestic animals usually derive no benefit from having them around. To the contrary, large animals like rhinos and elephants cause massive damage to crops. To put yourself in the shoes of local villagers, imagine that the people of Africa suddenly took a keen interest in the North American brown rat and that a crucial piece of the conservation strategy involved letting these creatures live and breed in your house. Further imagine that a poacher came along and offered you cash to show him where the rats were nesting in your basement, Hmm. True, millions of people around the world derive utility from conserving species like the black rhino of the mountain gorilla. But that can actually be part of the problem; it is easy to be a “free rider” and let someone else, or some other organization, do the work. Last year, how much time and money did you contribute to preserving endangered species?” (Page 24, paragraph 2) Chapter 3: “Taxing behavior that generates a negative externality creates a lot of good incentives. First, it limits the behavior. If the cost of driving a Ford Explorer goes
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  • Spring '08
  • smith
  • gross domestic product, Federal government of the United States, Bankruptcy in the United States, inch color television

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naked chapters - Chapter 1"Economists sometimes ask"Who...

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