StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...

A Treatise on Economics - Term Paper Example

Comments (0) Cite this document
Summary
19 April 2012 A Treatise on Economics How “fair” is a market-based economy? A market-based economy is largely self-regulating. This type of economy leverages human behavior. In his book, Naked Economics: Undressing the Dismal Science, Charles Wheelan states that “when the cost of something falls, it becomes more attractive to us” (10)…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER96.3% of users find it useful
A Treatise on Economics
Read TextPreview

Extract of sample "A Treatise on Economics"

Download file to see previous pages While not perfect, a market-based ecomony operates on familiar rules because those rules mimic the choices people are likely to make. In Wheelan’s words, “a market economy is to economics what democracy is to government: a decent, if flawed, choice among many bad alternatives” (21). Do market incentives always lead us in the right direction? Market incentives are subject to interpretation and application by individuals, groups, and other entities. Incentives exist to encourage desired behavior, and can be successful to the extent that incented people embrace the incentives. Wheelen asserts that “when we are paid on commission, we work harder; if the price of gasoline goes up, we drive less” (26). People’s responses to incentives allow the market to adjust. If an economy is not reliant on the market, government does not reward good or poor work practices and behaviors; the result is often inefficiency, poor quality, and high cost (27). Alternatively, incentives can present problems. One of these is the “principal-agent problem” that presents itself when a business, the principal, hires an employee, the agent, who may be incented not to act in the best interest of the company (31). In these cases, the agent may see personal gain as a greater incentive than the incentives provided by the company and steal or take advantage of the work situation in other ways. The success of incentives in a market-based economy is subject to the decisions of the people who respond to them. Incentives may not always lead us in the right direction. Can government help to guide our incentives? Government can help guide our incentives, but too much of this guidance could spell disaster. Wheelan states that “the communist governments of the twentieth century controlled their economies by controlling their citizen’s lives” and “often wrecked both in the process” (21). Other ways the government could guide incentives include taxes and regulations. Incentives tied to taxation add complexity to “public policy” in an effort to transfer wealth to the poor (38). Businesses and individuals respond by “avoiding or reducing the activity that is taxed” (38). The result is often that the economy does not realize the anticipated boost to the expected extent, if at all. Regulations, on the other hand, may be unavoidable. Wheelan suggests that “good government makes a market economy possible” (51). One role the government plays is to “define and protect property rights” so that individuals and businesses can develop and produce unique products without fear of those products being stolen or misused (52-4). The government can also support business and individuals by “providing uniform rules and regulations, such as contract law; by rooting out fraud; by circulating a sound currency” (54-5). While government involvement in economics may not be popular, if present at an acceptable level, the government can provide a framework in which a market economy can thrive. In Wheelan’s words, “government is like a surgeon’s scalpel: It is an intrusive tool that can be used for good or for ill” (80). What is “human capital” and how does it relate to a country’s economic well-being? Wheelan defines “human capital” as “the sum total of skills embodied within an individual: education, intelligence, ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“A Treatise on Economics Term Paper Example | Topics and Well Written Essays - 2000 words”, n.d.)
Retrieved from https://studentshare.org/macro-microeconomics/1448274-naked-economics-by-charles-wheelan
(A Treatise on Economics Term Paper Example | Topics and Well Written Essays - 2000 Words)
https://studentshare.org/macro-microeconomics/1448274-naked-economics-by-charles-wheelan.
“A Treatise on Economics Term Paper Example | Topics and Well Written Essays - 2000 Words”, n.d. https://studentshare.org/macro-microeconomics/1448274-naked-economics-by-charles-wheelan.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document

CHECK THESE SAMPLES OF A Treatise on Economics

Financial Markets and Economics

As of the staff of the Indonesian mine, a thorough evaluation of the existing resources should be conducted regarding all levels of the working area (from the management team to the worker).
b. The acquisition should create a competitive advantage for TCC mainly for the following reasons: 1. This mine should be the first offshore production base for TCC, a fact that could help towards the reduction of the company’s dependence on domestic mines, 2. The transport of the material from the specific mine is easier due to the absence of issues like the rail or port bottleneck, 3. Currently, the mine has a positive performance with a tendency for more growth (an export authorization for 20% more tonnage was granted this year)...
12 Pages(3000 words)Assignment

International Business Economics

According to Adam Smith, the absolute advantage would be realised as long as the cost of production differed from between countries, one or both countries would gain by trading. An example to illustrate this is a situation where we have two countries A and B which produce two similar goods X and Y. The figures show labour cost in hours for producing one unit of a good

David Ricardo formulated the theory of comparative advantage and argued that even if one country is more productive in both lines of production it would be still profitable to trade. Country A is more productive in both lines of production but it will still be profitable to trade with country B, this is shown by first stating that country A is more advanta...
6 Pages(1500 words)Assignment

Business Economics: Small and Medium

The entry of small firms into the global markets has proven to be the main aspect of the creation of economies of scale. Markets are fast evolving to the needs of varied tastes and customer preferences, so necessary knowledge and technology asset has a major role to play for small firms to rise and to match up to the situation. However, small firms are characterized by “smallness of the market share (a large number of similar-sized firms) and hence lack of individual market power, corresponding to the theoretical concept of Pure Competition.” (Waite 1973. P. 154).

They need to overcome the handicap of smallness by strategic alliances and mergers with larger or technically more competent entities. Small firms...
10 Pages(2500 words)Assignment

Issues in Applied Economics

A major issue then, becomes the convincing obligation by the polity not to abuse its force. Because institutions are planned by people with different bargaining powers and not for sake of effectiveness, some models may be less competent than others and due to path dependency, may continue for a long time, resulting in sluggish economy. The shortage of realistic commitment by the state not to suitable property human rights accounts for the incompetent institutions that have developed in different countries. To humor, such situation provides disincentives to investment in socially profitable enterprises, and generates groups with vested interests in preserving the status quo constraints.

Institutions present the fundament...
6 Pages(1500 words)Term Paper

Economics or Ethics

Several CEOs in America have in coalition with top managers deviated from the norms of corporate governance and caused immeasurable woes to the stakeholders. Using their power and ego they chased the wealth for personal gains without any concern for the shareholders or other stakeholders of the company. Enron, the world’s largest energy trader at one time, had to file bankruptcy under Chapter 11 when about 5000 workers lost their job (Bhattacharya, 2004). Arthur Anderson, one of the big five auditing firms was charged to have colluded with the management to misappropriate funds and project a picture different from the reality. Income was inflated and then all concerned papers were destroyed. The leadership at Enron was conce...
6 Pages(1500 words)Assignment

Real Estate Economics

...Real e economics: Introduction: The real e industry is engaged in leasing, renting, selling of real e and buying real e on behalfof others. The real estate industry comprises of the owners of the estates, the users who are the consumers, the developers who build, the renovators who refurbish buildings and the facilitators who enable sale of real estate, the facilitators comprises the financers example banks, the brokers and lawyers. According to July statistics this year the industry employs over 2125 thousand and the hourly wage rate is estimated to $16.37. This paper discusses the real estate industry on the basis of demand, supply, elasticity of demand and supply, wage rates and wage inequality, how monetary and fiscal policies affect...
7 Pages(1750 words)Assignment

Sports Economics: The Impact of Sports on the Economics of a Community

...Sports Economics It seemed like we are in a financial golden age for professional sports in these past fifteen years or so. Sports revenues and player fees have tremendously skyrocketed with the likes of David Beckham, Kobe Bryant, Ronaldhino and Roger Federer raking in more than 30 million dollars each in 2007 alone according to Forbes. (Badenhausen 2007) This is not surprising because the popularity of spectator sports has been steadily soaring particularly in the early 1990s. During this time, attendance is up 85 percent in baseball, 130 percent in basketball, and 40 percent in football and hockey with many clubs continually selling out as the value of broadcast rights have grown even faster than attendance: a fourteenfold increase...
8 Pages(2000 words)Term Paper

Managerial Economics and Business Environment

Once the above said subject matter is clearly sorted out, the next emphasis would be on the concepts like the opportunity costing, incremental principle, marginal principle, discounting principle, the principle of time perspective, and calculation of economic profit as the guidelines to the scope of managerial economics. (Surender. V, 2008).
To start with, we consider a firm for which different processes have to be carried to achieve its objectives of profit maximization (assuming that all the organizations work with the view to maximize profits). If firms from different sectors are identified simultaneously, then the working of the economy as a whole could also be analyzed which in turn is useful in the decision-making proce...
15 Pages(3750 words)Assignment

Economics in Business

...Economics in business Introduction: The purpose of this paper is to analyze the business objectives as best applicable to the Southampton Solent University. Herein, it is essential for the author to analyze the competitive landscape that the university finds itself and try and identify the forces which are governing the business decisions of the university. Further, the author aims to complete understand the simplex of competitive market forces and subsequently make recommendations for better future functionality of the university. PESTLE Analysis The author feels that it is applicable to use a PESTLE analysis due to the fact that the Political, Economic, Social, Technological, Legal and Environmental aspects of this model...
6 Pages(1500 words)Assignment

Economics Perspectives and Policy

...Running Head: ECONOMICS PERSPECTIVES AND POLICIES Economics Perspectives and Policy of the of the Economics Perspectives and Policy Macroeconomics and Microeconomics The field of Economics has two branches that are microeconomics and macroeconomics. The learning of the whole economy in the world is called Macroeconomics, including inflation rate, business cycles, business growth and the rate of unemployment. On the other hand, Microeconomics is the study of individuals and how their choices influence the flow of the economy. (Giannetti, 2003, 190) Microeconomics and Macroeconomics are linked with each other. For example, the price of gas in California is about 10% higher than the national average. California is one of the largest states...
6 Pages(1500 words)Coursework
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Let us find you another Term Paper on topic A Treatise on Economics for FREE!

Contact Us