tailieunhanh - Ten Principles of Economics - Part 4

Ten Principles of Economics - Part 4. Economics is the study of how society manages its scarce resources. In most societies, resources are allocated not by a single central planner but through the combined actions of millions of households and firms. Economists therefore study how people make decisions: how much they work, what they buy, how much they save, and how they invest their savings. Economists also study how people interact with one another. | CHAPTER 2 THINKING LIKE AN ECONOMIST 33 Table 2-2 Proposition and percentage of economists who agree 1. A ceiling on rents reduces the quantity and quality of housing available. 93 2. Tariffs and import quotas usually reduce general economic welfare. 93 3. Flexible and floating exchange rates offer an effective international monetary arrangement. 90 4. Fiscal policy . tax cut and or government expenditure increase has a significant stimulative impact on a less than fully employed economy. 90 5. If the federal budget is to be balanced it should be done over the business cycle rather than yearly. 85 6. Cash payments increase the welfare of recipients to a greater degree than do transfers-in-kind of equal cash value. 84 7. A large federal budget deficit has an adverse effect on the economy. 83 8. A minimum wage increases unemployment among young and unskilled workers. 79 9. The government should restructure the welfare system along the lines of a negative income tax. 79 10. Effluent taxes and marketable pollution permits represent a better approach to pollution control than imposition of pollution ceilings. 78 Source Richard M. Alston J. R. Kearl and Michael B. Vaughn Is There Consensus among Economists in the 1990s American Economic Review May 1992 203-209. Ten Propositions about Which Most Economists Agree I QUICK QUIZ Why might economic advisers to the president disagree about a question of policy LET S GET GOING The first two chapters of this book have introduced you to the ideas and methods of economics. We are now ready to get to work. In the next chapter we start learning in more detail the principles of economic behavior and economic policy. As you proceed through this book you will be asked to draw on many of your intellectual skills. You might find it helpful to keep in mind some advice from the great economist John Maynard Keynes The study of economics does not seem to require any specialized gifts of an unusually high order. Is it not . . . a very easy

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