Physicists don't need to encourage apples to fall to the ground.
Principles of economics - choices and consequences
Reading Obits in NYC to Find an Apartment
Persistent shortage
Non-monetary costs
Price competition is illegal
Other forms of rationing necessary
Discrimination now lower cost
Quality issues
Building new apartments?
More affordable? Less scarce?
Effects of Prohibition
Supply more inelastic
Risk costs rise for buyers and sellers
People who have a comp advantage in crime rise to the top.
Only strong alcohol - alcohol poisoning
No beer - only hard stuff.
Behavior patterns change - only drunk
Prohibition gone, now a $20 billion drug war
Taxes Are Paid By...
Elasticities of supply and demand
Taxes cause a vertical shift up in the supply curve (if sellers pay the tax)
A vertical shift downward in the demand curve (if buyers pay the tax)
In the short run - whichever group is inelastic pays the tax
In the long run, quien sabe
Remember - People Pay Taxes - consumers, stockholders, lower wages, etc.
Taxes drive a wedge between buyers and sellers
Reduce the likelihood that a wealth creating exchange will take place
Paint the house example
Costs and Prices
Sports ticket prices go up because costs have increased
Costs have increased because competition for good players has intensified
Competition for players have increased because the demand for tickets has gone up (players are a more productive resource).
Soccer vs football in the US - in Europe.
Higher beef prices
If demand increases, the cost of selling beef increases
The butcher calls the meat packer who calls the cattle ranch, etc.
Free Medical Care and Demand
How much do people want when it is free?
Is there any mechanism for knowing how much people value something if they don't have to sacrifice to see it?
Where there are no functioning markets, there is no index of value.
Society can determine how much of something to produce if they have the marginal cost and marginal benefits.
How May Roads to Build (When the price is Zero)
Resources Will Tend to Be Allocated Properly When Property is Owned
The military
Jury duty
Deciders don't have to pay the opportunity costs of assigning soldiers or jurors.
Do they waste them?
"If government officials have the power to obtain valuable resources without having to bid for them, how will they discover the value of the resources in alternative uses?"
The costs of a resource reflect their opportunity cost!!!!!
