11.16.10 Econ

11.16.10 Econ - 11/16/2010 A way to internalize...

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11/16/2010 A way to internalize externalities is to put them in the context of social norms. Section 9 in the Syllabus Income Distribution What is going to be produced? How are they produced? Who gets the produce? Income distribution answers question for whom In market economy, most people who can pay the price, can do so because of the wages they receive If we can determine the wage question then we can understand the distribution of goods and services If Income is unevenly distributed then market economy will unequally distribute goods and services Prudent to be cautious and skeptical for people who report data on income. We’re entering an area where there’s controversy over what’s a proper or just wage. Looking only at person’s income opens many dimensions when making value judgements upon people. John gets 100000 dollars per year Jill gets 10000 Fair? Well John holds 3 jobs and works his ass off Jill does nothing and sits around all day Why incomes vary? What is income?
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11.16.10 Econ - 11/16/2010 A way to internalize...

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