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lecture 6 notes

lecture 6 notes - Increase demand for cds clothing etc...

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Eco lecture 6 notes Non-Market Allocation: Does DMB (Dave Matthews Band) = RSI (rational self interest), rejectin what Adam Smith called the “obvious and simple system of natural liberty”? What produced: concert How: location (scott stadium) Inputs: musicians For Whom Bidding Market Clearing Price Political planning Tribal council Lottery: but why: Musicians don’t use RSI
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Unformatted text preview: Increase demand for cds, clothing, etc Positive network externalities1 Policy options when you don’t like market prices Move demand Move supply Peg the price directly But e aware of the consequences of Shortages with ceilings Price maximum is put in place Causes a shortage of the item up for purchase1 Surplus with floors....
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