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Unformatted text preview: Chapter 23: Economics Economic Worldviews – Economy is the management of resources to meet needs in the most efficient manner possible. – Sustainability is using resources in ways that make them last Resources, Capital & Reserves – Capital is any form of wealth available to produce more wealth. ○ Natural: what nature provides ○ Human/cultural: knowledge, experience ○ Manufactured: tools, buildings ○ Social: shared values, communities, trust Resource types – Resource – anything with potential use in creating wealth or giving satisfaction. ○ Nonrenewable resources – materials present in fixed amounts in the environment…oil, minerals, etc. ○ Renewable resources – materials that can be replenished or replaced…solar energy ○ Intangible resources – abstract resources such as open space, beauty, serenity, etc. Classical economics – Originally a branch of moral philosophy concerned with how individual interests and values intersect with larger social goals. ○ Adam Smith – Founder of modern western economics. Capitalistic system – market competition between willing sellers and buyers is believed to bring about the greatest efficiency of resource use. • Quote in textbook. – Demand is the amount of a product or service consumers are willing and able to buy at a various prices assuming they are free to express their preferences. – Supply is the quantity of that product being offered for sale at various prices. ○ In a free market, supply and demand should come into market equilibrium. – Marginal costs – cost of producing one more unit of a product or service – Price inelasticity – raising price does not necessarily reduce demand…gasoline, cigs, food Neoclassical economics – At the end of the 19 th century, the field of economics divided into two camps: ○ Political economy was concerned with social structures, value systems, and relationships among classes (Marx) ○ Neoclassical economics adapted principles of modern science to economic analysis…social concerns not considered Retained emphasis on scarcity and supply and demand in determining...
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This note was uploaded on 04/28/2008 for the course ENVS 1000 taught by Professor Neff,jason during the Spring '07 term at Colorado.
- Spring '07