economics review

economics review - -Increases after demand increases...

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Taxes Determining what makes a tax “FAIR” – equity. What do most people say is fair. Market Failure If markets aren’t competitive then we don’t reach efficiency. Basically we need to be technically and allocatively efficient Other explanations: Common good, Public Good, Economic inequalities, natural monopolies, antitrust, lack of information But they work most of the time. Government Failure When incentives aren’t right: Failure to respond to consumer demand, wanting to build big organizations, lobbying, subsidies unless outcome is chock full of benefits. Discrimination - Sometimes can be solved by competition Marginal Product
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Unformatted text preview: -Increases after demand increases because the marginal product of the worker increases in relation to increases in price.-When the marginal product goes up it increases demand for the worker-Outcome may not be as predictable for a single firm, but for the market demand for labor increases Monopolistically competitive firms The difference between this and competitive is that each individual firm has a monopoly on its own slightly different product, gives downwards sloping demand curve. Tax deductions Some is set apart at the beginning with zero tax rate. Then there is a deduction for number of people in the family...
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This note was uploaded on 04/28/2008 for the course ECON 101 taught by Professor Buckles during the Spring '08 term at Vanderbilt.

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