Christen Majors, Chaoter 9, Question 6

Although the chapter was primarily on GDP increase and decrease and its effect on a nation, the passage I found most interesting was on material progress and the things we take for granted. Wheelan asks us to consider cellphones and how not to long ago it was "impressive" to be seen with one. "Back then a cell phone cost about 456 hours of work for an average american" while today everyone basically has a cell phone in their hand. "Now (it) costs about nine hours of work." This is seen as a rapidly increasing standard of living and most of us take that for granted when we shouldn't because a rapid increase is not normal for the majority of things in today's society or even throughout history.

Chapter 9 , Question 6

I was drawn to reading about the recession in 2007 because I faintly remember my parents talking about it and worried about it and beaming more cautions. I think why this passage really grabbed my attention was because everyone's spending affects everyone. What you buy for lunch, if you decide to buy or sell your house. Everything. I mean before I knew money circulated and such, but I didn't really connect it all together. The line also, "if we all believe that the economy will get worse, then it will get worse. And if we all believe it will get better, then it will get better." I think this demonstraightss how much the economy is a system where we all act out of our own self interest, when really it is all of us that determin how it is and all of us and our spending or saving that affect it.

Adam Hano, Chapter 9, Question 1

In chapter 9 Charles Wheelan explains how we measure the growth of our economy. He questions whether GDP is the right and most accurate measurement we can have. He then gives other potential better types how to measure our economies. For me, the most questionable thing is that if we don’t have a precise type of measurement, why does it than matter so much. There are agencies such as Moody’s or S&P that give ratings to countries based on their GDPs and other factors. Based on those ratings, country gets their interest rates, when they borrow money. However, if those measurements aren’t 100 % correctly talking about economies than the ratings aren’t too. Therefore the interest rates aren’t rightly evaluating the economy, which in the end affects me, because I have to pay more or less in my taxes. 

Collis Mckenzie, Chapter 9, Question #6

I learned about another way that politicians could potentially use  specific word play to lie without technically lying.  The  idea of GDP versus real GDP is an important distinction to make.  If the nominal GDP increased by 40%, but inflation also increases by 40% then there really isn't any change., but politicians could say that there was massive GDP growth  and be misleading but not technically  lying. It's just more another outlet to mislead people who don't know much about economics. It reinforced  the idea for me that  politics is full of buzzwords that people don't understand.

Jack McGillivray, Chapter 9, Question 6

One analogy Wheelan made that I quite liked was contrasting the global economy to sports. In playing a sport one stands to benefit off an opponent's disadvantage or loss. However in the global economy it is advantageous to all for everyone to be doing as well as possible. This is a concept that many people, including myself, don't realize. It is easy to think that if China's manufacturing industry tanks, it will benefit America by providing more manufacturing jobs. however the opposite is true. Because there will be less people able to afford what we produce, American manufacturing will decline as a result. It is somewhat startling to me to think that basic tenets of economics, such as this,  are so widely unknown.

Lily Bjorlin, Chapter 9, Question 5

What struck me the most in this chapter was when Wheelan was talking about the other ways to measure economic success. When he mentioned that our poverty rate is roughly the same as it was in the '70s, I couldn't believe it. You would think with all of our technological advancements and human rights campaigns in the past 45 years we would at least have made a dent in the poverty rate. It made me think of when we were taking in class the other day about how we help the poor. I think that if we had more programs (efficient and inexpensive programs that is) it would greatly help our nations poor.

Caroline Paulsen, Chapter 9, Question 6

In chapter 9, Charles Wheelan points out the deficiencies in using GDP alone to measure the economies/prosperity/happiness of countries. Although I had known that GDP was an insufficient measurement, I hadn't previously known how insufficient it is and how many different approaches there are to help measure particular parts of economies and determine economic prosperity.  I found it fascinating how people are trying to come up with new methods measuring these things, such as with a Green GDP (to subtract environmental damage that can appear to help short-term economic growth) or a Human Development Index (to measure other aspects of economic health such as GDP, life expectancy, literacy, education, etc.). I also thought that it was amusing how people are even trying to figure out new ways to calculate national happiness.

Yaphet chapter 9 q#5

"Making money takes time, so when we shop, we're really spending time. The real cost of living isn't measured in dollars and cents but in the hours and minutes we must work to live." This passage struck me as interesting because I never put it that way. Every time I work I never think about giving up time from my life for money. So every time I make a purchase, it's not only paid with money but also my life. It's almost a little scary how we give time from our life for money.

Eleanor Oakman. Chapter 9, Question 1

At the end of chapter 9 Wheelan brought up how u.s citizens save their money for future goals, an example  would be college. This made me think of what happened to me this weekend!

Every year I play club volleyball and since college is coming next year, the savings is getting stricter. My family and I realized that we wouldn't be able to afford for me to play club this year. (due to saving for college), I was completely devastated, it made perfect sense and the logical thing for us to do was cut off sports. Then we contacted the club director and made an agreement saying that I would clean the bathrooms and run the consession stand in order to make up for the money at the club that we can't spend. Now this isn't what I expected to be doing this year, but because of how we HAVE to save for college, I am happy to do it in order for me to play volleyball.

Laura Bartz, Chapter 9, Question 5

China's ever growing economy is something that is always talked about with envy. But something that is often forgotten (including myself), is their horribly polluted environment. China being seen as this untouchable economic power house, is actually a pretty misconstrued idea if you look at the state of their air, the lack of nature, and the negative externalities that are left in the publics health. I find it so interesting that Wheelan mentioned that while on paper their GDP growth is at 10%, but once their pollution costs are factored in it drops to 7%. Maybe their economic untouchability isn't so enviable after all.

Bennett Pope, Chapter 9, question 3

In chapter 9, Wheelan talked about one of the causes of recessions, and the remedy he suggested was interesting, but ultimately impractical. On page 202, Wheelan describes how people spend less when they are under pressure financially. This is common sense because we have less to spend. However, Wheelan says that by saving more money, we actually increase the problem. By not spending money on the things I would have before, bussinesses have to lay people off to maintain costs. This person who was just layed off will, in turn, not spend money on other bussinesses, and the whole economy goes into a downward spiral. Wheelan says that if people would keep spending, then we would be better off, but he also recognizes that this method is incredibly impractical. When people have less to spend, they aren't going to want to spend it. Even if everybody chose to keep their spending up, we could still easily run out of funds quickly. Wheelan himself describes the situation as a paradox. While it may work if everybody pitched in, I do not foresee a situation in which everybody actually would.

Nathan Rowley, Chapter 9, Question 6

I had known we were in an economic recession in 2007 before reading chapter nine. What I didn't know was just how serious it was, and how much of an impact it probably has on my life. To think that we very easily could have had a second Great Depression is scary. It was thanks to our knowledge of history that we avoided the mistakes that would have set us on that path again. And that got me thinking on how much we actually know about economics.

Part of the reason why I have found economics so fascinating since beginning this course is that it is a relatively new field in its current form; the large-scale economies that create the business cycle and other global effects are only a couple centuries old, hardly a blip even on the time scale of human existence. We have had so very little time to adapt and learn about how to manage such large entities, and in the process we've made mistakes; the Great Depression is the first to come to mind. But it is a testament to how much we have learned that we avoided the same mistakes in the 2007 housing crisis. And the paradigm shift from rational self-interest to behavioral economics is a testament to how much we still have to learn. I am attracted to fields likes economics precisely because they haven't been around very long, because there is still a large body of unknowns to discover. It makes me excited, that there are so many things that we have yet to learn.

Lily Bjorlin, Chapter 6, Question 4

Lots of people think that technology is taking jobs from humans. Yes this is true but a fair amount of those jobs being replaced by technology are jobs most people don't want to do anyway or jobs people consider beneath them. As our productivity increases our need for cashiers and people in fast food restaurants will decrease. It's just like in the movie charlie and the chocolTe factory when Charlie's dad loses his job to the toothpaste cap twister machine but then gets another job by being the guy who fixes that machine when it isn't working.

Jack Bexell, Chapter 6, Question 5

"Excellent trial lawyers are scarce; burger flippers are not. ... True, people are poor in America because they cannot find good jobs. But that is the symptom, not the illness. The underlying problem is a lack of skills, or human capital. The poverty rate for high school dropouts in America is 12 times the poverty rate for college graduates."(Wheelan 129)

This stuck out to me because it shows that the reason that poverty is so high is that there is a lack in education. Later on the page Wheelan talks about the poverty rate in India and compares it to the high illiteracy rate. The reason why people can not get jobs is because people are not educated and trained to be out in the real world. This is more of a problem when people are stuck in impoverished areas, without an education system. With little to no help with a chance to break the cycle, there will be no chance to decrease poverty throughout the world. Another problem with stigma is that if a child of an impoverished family realizes their tough "predetermined" predicaments, they might decide that there is no way out of it. Follow the leader in a horrifying example caused by human capital.

Jacky Xu Chapter 6 Question 1

This issue affect my daily life.Human capital generally means how much do you worth.In the book,the writer talks about that many individual will find a job,and some highly educational people will start their own company.This remind me the importance of learning new things,acknowledge myself,to improve my value to make more.

Jack McGillivray, Chapter 6, Question 1

One of the ways in which this chapter relates to my life is the conversations I've had with my coworkers at Walgreens. At the store I worked at, the majority of my coworkers were much older than me, many of them were into their 50's and 60's. Through talking to them I learned that only one of them had gone to college, and many hadn't finished high school. Many of them had been laid off from a previous job and were only able to find work at minimum wage. They were extremely limited by their lack of human capital and because of this were unable to find work for a decent wage. This really stressed the importance of education to me, many of these people were friendly, bright, and compassionate. But no matter how good of a person they are they're limited by their education.

Adam Hano, Chapter 6, Question 1

In Chapter 6 Charles Wheelan explains how does productivity affect your Human Capital and what is it’s outcome to wealth of our Society. The Numbers were stunning. Each year we are 2% wealthier. I have never realized that this wealth is because of our increase in productivity. He also argued that there is no fix amount of job do be done, but that we still create new professions. He gave an example of farm town and explained how it grows.

As a Slovakian I am really ashamed of my country now. Charles explains how Americans are productive. I do agree with it. The productivity factor is deep in your culture and mentality. Slovaks are lazy. We can see that in the services we offer. Slovaks don’t value the customer rather than their own well-being at that moment. It is on daily biases that you argue with either a lady behind the counter on train station, waitress in restaurant or teachers in school. I hope It won’t take us long to realize how important productivity is to the growth of our small nation. 

Matúš Kočalka, Chapter 6, Question 5

Mr. Wheelan gives us an example with 100 000 student dropouts and 100 000 educated students. Both groups are transported into the same big city - Chicago. In the first case, after these dropouts came, it would cause a chaos, because there wouldn´t be enough work and the officials of the city of Chicago would either try to get rid of them, or to get some financial support that would provide the work opportunities for them. In the second case, educated students would be successful in finding the jobs, creating new companies and it wouldn´t be disaster (as it was in the first case). 

This brings me into the confusion. I understand that the human capital is nowadays highly demanded and that there´re benefits coming out of employing the educated people, but on the other hand - where´s the limit? The author states that: "the more productive we are, the richer we are." But if the wealth comes hand in hand with the education, then what if everyone starts to go to the university? 

My example is taken from Slovakia, but I´m sure that it´s happening in the other parts of the world as well. Young people in our country are attending universities/ colleges, because they want to graduate and to have a title in front of their names - since it means to have a better future. The social structure therefore changed. As opposed of the past, when we had a lot of people having just the high school education, nowadays almost everyone gets the university degree. But this means that we´ve thousands of educated people, who want to get the job - and do we have enough job opportunities? No. It´s sad, but young people in Slovakia have trouble to find a job, and they many times have to lower their skills and take the inferior work, or they´re unlucky and they don´t manage to get any job. If the market is overflowed by the university graduates and the education loses its worth. 

Lauren Stevens, Chapter 6, Question 1

An example that relates to my life is when he talks about productivity making us richer. This applied to my life during the "back to school" season at American Eagle. In order to meet our goals for the amount of denim or sweaters we sold there was a "BTS contest." How it worked is while you're working, if you do an exceptional job, you name gets put in the drawing for the day. For example, for every 5 rewards cards the cashier got, that equalled the name being put in the drawing once. In my case, my manager always had me filling clothes where we had already sold them. Every cart full I got put on the floor, I got my name put in once. Therefore the more productive I was the "richer" I was.

Collis McKenzie, Chapter 6, Question #6

One of the things that I got a broadened view of was the place of menial jobs in a society of overqualified people. If everyone is smart enough to be a doctor, who is going to drive the garbage truck? The solution is simple, but makes complete sense. Whoever sees the newly highly demanded job as worth more than his/her current job or someone with no work experience would sit behind the wheel. The importance of low-level jobs is often undervalued because a lot of times people don't think about the experience that is gained from a part-time job in addition to the money. Not many people step in and get a CEO job right out of highschool. Low-level employment is where people skills and responsibility are learned and strengthened.

Chapter 6 Question 6

          When reading this chapter on thing that came to my mind, which seemed kind of dark at first and I felt bad for thinking about it, but this chapter really reminded me of Darwin's "Only the fittest survive." This may be true in the animal kingdom, and it seems to apply to our society today. While reading this it opened my mind that sometimes its not always about not having the resources available, but not having the attitude or drive instead. Kids now days who do have access to a public education still may drop out. This could be because  a multitude of different things, but a lot of time it can we drive or willing to learn because they may not have a strong work ethic. This Wheelman talked about in the chapter, how people are born with certain qualities that set them up for success. Even though this sounds harsh and hopeless, I do think that this is true. However, that doesn't mean successful people should leave to unsuccessful out to dry, if we can somehow then have people to help teach others these ways to success. Making public education more available does help to a certain degree, but what about counselors or career counselors   These people can connect and help someone in a more personal way that will help set up others for success.

Eleanor Oakman. Chapter 6, Question 6

Reading chapter six I was especially intrigued by what Wheelen said about how Americas economy is become more and more unequal.  One of the main points so many people came over seas to the new land (USA), was because of the economic opportunity and the equal potential everyone had regardless of their economic status. Now today "the rich get richer and the poor run in place, or get even poorer." The worse thing is, this is very true, there are everyday examples people see that support this statement. Like how high school dropouts who couldn't afford the tuition are getting paid less than their fellow coworkers who had graduated. I don't like this but in a way it makes sense. If you were to pick one of two job applicants for a position, you would go for the high school graduate rather than the dropout, because they seem more qualified. But what is so sad about the unequal opportunities is that, what if the high school dropout has better work ethic than the graduate, or turns out the graduate is an all around idiot!!

Caroline Paulsen, Chapter 6, Question 1

In Chapter 6, Charles Wheelan points out the primary purpose of education— to gain skills that make you a valuable piece of human capital. For the past couple years, I have been trying to figure out how to structure my schedule so that I can do just that. From elementary school to my sophomore year of high school, my theory was usually "homework first"— in my case, this often meant getting homework done before practicing cello. However, sometime around the end of sophomore year or the beginning of junior year, I became certain that I wanted to major in music (or attend a conservatory) and become a professional musician. This decision made me rethink for the first time how I should prioritize my time to gain the skills that I need. I realized that to get into college and be a musician, having plenty of time to practice is more important than completing homework first. I ended up learning to schedule practice time and do homework around it so that the skills that I need the most became a priority.

Ingrid Snook, Chapter 6, Q. 6

This chapter has definitely showed me that we aren't going to run out of jobs anytime soon. It's opened my eyes to how the U.S. could really benefit from bettering and educating the population as a whole instead of the theory of taxing the rich and giving to the poor. That might work in the short term, but what would be beneficial for years to come would be improving the lives of individuals by educating them to be more productive. I also thought it was interesting how Wheelan said that envy plays a part in people's economic choices. Why would someone choose $100,000 just because that was the circumstance where their peers had less when they had the opportunity to have $110,00? This chapter also had me asking one question in my head the whole time: why don't we put more into improving public education or try to make college education cheaper if it's really going to benefit society that much?

Bennett Pope, Chapter 6, question 5

A passage that I found interesting in chapter 6 was Wheelan's paraphrase, "500 million minds are a terrible thing to waste." In this chapter about productivity and human capital, I thought this quote encompasses both ideas very well. Productivity is as much about how much we waste as it is the amount we create. It doesn't matter how many millions or billions of people we have, the addition of 500 million educated minds will help us become more productive. This all hinges, however, on the human capital that these people provide. They are "wasted" because they have low human capital. By investing in their education, we do not waste their minds, which, as the quote says, is a tragedy.

Nathan Rowley, Chapter 6, Question 5

Although chapter six speaks a lot about poverty, Charles Wheelan ends the chapter on an uplifting note. After posing a series of three pessimistic questions about poverty asking whether poverty is inevitable, Wheelan promptly answers them, "No, no, and no." The reason that poverty must not necessarily exist in an unequal market economy is because economic growth is not a zero-sum game; as the economy continues to grow, everyone will gradually gain greater and greater wealth, even if they may not gain wealth relative to others. Wheelan even posits that it is possible to end poverty in our current economy. He says that families "are not poor because Bill Gates lives in a big house. They are poor despite the fact that Bill Gates lives in a big house." We have reached a point where there is enough wealth for everyone to live comfortably, as Wheelan implies. That there are still people in poverty is not a fault of there not being enough wealth, nor is it because wealth is being withheld from them. It is because of the way our society functions that can prevent people in poverty from getting what they need to improve their lives.

Laura Bartz, Chapter 6, Question 1

In chapter 6, Wheelan talks about human capital. He talks about the reason why a lot of people are wealthy is because they have good human capital. Some people who have strong human capital have it because ether are naturally good at something, like Michael Jordan, others have invested in their human capital to be able to learn skills that will increase their capital. So when people start asking the question of is college actually worth it, there will be a lot of different answers. Wheelan would say that yes in fact college is worth the investment because you are investing in your human capital. Now Wheelan would not suggest that you go to Sarah Lawrence college as he previously talked about in the book, that the student is more telling of success than the college, but college is worth it, to increase your human capital.

Christen Majors, Chapter 8, Question 2

Wheelan mentions the certification process that some teachers have to go through in order to teach. In the end However, regardless of weather or not a teacher is certified or not. The test scores show no preference as to if the certified teacher is more equipped than the non certified teacher. As for the future this certification process keeps well equipped teachers from teaching. Although the public school system reforms there is no effect on the students or the teachers ability.

Nathan Rowley, Chapter 8, Question 5

The passages that most interested me in chapter eight were the ones dealing with interest groups. I was initially surprised when I learned that a smaller group is often a more effective one in our political system. It seemed counter-intuitive at first, but when I began looking at the details, the logic became clear (seemingly a common characteristic of sciences: superficially confusing but internally logical). The idea that a small group is better than a large group flies in the face of the way our government is supposed to work: the majority is supposed to make the rules. However, the opposite is often the case, at least when dealing with a large, unorganized group like the general public. This is because the small group can effectively push for its agenda, while the large group is too unorganized to oppose it, even if that agenda is a net burden on the economy. In addition, the cost of meeting the small group's requests is spread out across the general public, so we barely notice it.

Lily Bjorlin, Chapter 8, Question 1

The main issue in this chapter that applies to my life is the teacher certification situation. The vast majority of people in my family are teachers. My mom, my dad, my aunt, two of my uncles, five of my cousins, my grandpa, and my grandma were/are teachers. I am planning on being and Elementary Education major in college and be a second grade-ish teacher one day. If teachers' unions continue to make it harder to get accredited, the supply of new teachers will decrease. While it does make sense to increase the required level of learning for teacher so as to have a higher quality of education available to students, by only making new teachers go through the harder process education boards aren't really changing anything. They are only thinking of how it will look to the public. If they made the new credidation level required for all teachers, the quality of education would be more likely to be better.

Laura Bartz, Chapter 8, Question 5

Qhat struck me as the most interesting was that it doesn't actually make that much of a difference in whether or not a teacher is certified in the performance of their students. Of course once I think about it more the logic becomes more clear. If you are a talented teacher a piece of paper that says you are certified won't make a difference in the performance of your students. I also find it very interesting that in spite of this data states are increasing the amount of required certification, but it wouldn't look very good to parents to see that their public school systems are letting in seemingly less qualified teachers. Which just proves that generally with economics, the rational thing to do won't happen because at face value based on what people think they know to be true, isn't what is lobbying to happen.

Caroline Paulsen, Chapter 8, Question 5

One key topic in chapter 8 that struck me as significant was about creative destruction. An example of creative destruction that the class discussed earlier this year was about new technology involved in making roads. This is particularly relevant to Minnesotans, since our roads are plagued by potholes due to our relatively extreme weather. Although the technology to make new roads that are less easily ruined exists, we decide to keep patching up the old roads or rebuilding them with lesser technology. This is a bit like Charles Wheelan's example of the Pony Express and the telegraph. With the invention of the telegraph, messages were transferred much more efficiently than they would have been by the Pony Express. However, unlike with the present-day roads, the government didn't decide to ban the telegraph because it would cause people to lose their jobs. Wheelan also points out that in general it is more helpful to retrain people in different professions than it is to ban innovations.

Chapter 8 Question 6.

A passage that stood out to me (and possibly the person who owned this book before me because a bit of it was underlined) was when it said that government taxed ethanol 5.4 cents less per gallon than gas, even though, through researched has shown that it may not be so much greater than gasoline. On the plus side for the american economy, it lowers dependence on our use of foreign oils, but it still hurts mother nature. It evaporates faster than gasoline, so it still contributes to damaging the ozone, however after another study was done, ethanol did reduce greenhouse gas emission by 12% relative to gasoline. Still, even with if all the corn crop of america was used to go towards ethanol, it would still be only a fraction, and expanding that farm land would cause even more damage to mother nature because of pesticides and chemical run off and residues.  This passage stuck out to me because it seems like every single thing is connected. This goes back to negative externalities. I also didn't understand then why would there be a tax break on a product like this which the subsidy have cost $7.1 billion to. Imagine, if there wasn't a tax break how much money could be made to go to other causes like research in finding another way to produce energy for transportation that doesn't kill the earth. Or go into public transportation so not as many people drive.

Jacky Xu,Chapter 2,Question 1

So this chapter talk about free rider,it's the people who didn't pay the same amount of fee,but enjoy the benefit too.This happens everywhere in the world.For example having a party,sometimes people didn't bring anything to the party but just simply eat and drink.Or a person is not willing to pay the fee to fix the road in front of his house,because he is hoping someone else will do it.Others will think this person will do that,the road will end up sitting there broken.
  Also I have to say that many people in our society will willing to sacrifice himself to increase the social benefit,this action is very honorable.

Jack Bexell, Chapter 4, Question 5

"If the USSR taught us anything, it is that monopoly stiles any need to be innovative or responsive to customers."

I remember learning this sophomore year, where the USSR was communist, so there was no chance of more than one company to make a product.

Lily Bjorlin, Chapter 4, Question 5

The passage that caught my eye in this chapter was when Wheelan started talking about DDT. We learned all about DDT last year in Biology and how it was just plain bad. However this chapter taught how even if something seems bad at first in the long run that bad thing might actually be good. You have to compare the overall oppurtunity cost. This especially comes in handy as we are an out to choose colleges and need to compare prices with how much we like the college and what we could learn there.

Matúš Kočalka, Chapter 4, Question 3

The author mentions, that when the government is the only provider of the services (monopoly), it is a problem. He proposed that the government should rather hire private companies to build e.g. highways, and thus not to do it by itself.
This is kind of controversial - in some countries it´s probably better solution, but in others, it´s very risky. Building a highway was an enormous issue in Slovakia a few months ago. In our government, we´ve currently a really corrupted political party that rules the whole Slovakia. By hiring private companies to build the highway instead of building it on their own, they could conceal the corruption that was going on. They simply got rid of the responsibility - since the public attention is usually on them and not on some company. So it wasn´t successful at all.
So basicaly there was a public competition, that was won by one certain company with connections to the leaders in this party even before it became public, and this company used almost all of the money for their private usage – they didn´t even pay salaries to the workers that they hired for building the highway, and now there´s no one who would pay them for their work.                                                   So in our- Slovakian case, it simply caused even worse corruption, since the government get rid of the responsibility by building it, and hired private company to do the “dirty job” instead of them.

 

Snook, Ingrid, Chapter 4 Question 2

It seems to me that the issue of the government brought up in this chapter could have short term and long term, both positive and negative, consequences. With the government controlling so many parts of society, some necessary but some really unnecessary (like the postal service talked about in this chapter) the nature of friendly business competition can't be there. The government also interfering with market flow can be detrimental in the short run. With their interference comes a lot of extra costs, but it also keeps bad entrepreneurial situations at bay which can be beneficial in the long run. In the end, it seems like what would work best is a middle ground with government involvement but that's hard to agree on.

Christen Majors, Chapter 4, Question 6

Within the first page I found Wheelans statement on the DMV. This statement eludes to his later statements on the governments  monopoly on certain aspects of human life. He goes on to say that if a rat "scampers" across the floor of you favorite resturant at which you are eating you can then decide not to eat there anymore where as if you find the DMV annoying and a nuisance, too bad. You have to have a license in order to drive or else you are going to jail. The governments monopoly on and their lack of attention to those companies and the companies inability to innovate leads to start-up solo companies that try to get the work done their way. In example, instead of the US postal service, the UPS a private owned company get the work done on their own, and may I say a lot faster.

Jack McGillivray, Chapter 4, Question 6

What I found most interesting from chapter 4 was how many different Theresa there are on how involved the government should be and how much dissension there is between economists about which one is the most effective. To me it seems amazing that there could be so many possible conclusions to what seems on the surface to be a simple question; what could the scope of government be. I have always known of the arguments for large or small government, but I never knew the intricacies of how high and low tax rates and big and small government can impact the markets. And this will certainly make me take a second look at what I believe politically before this coming election.

Yaphet May, Chapter 4 question 5

"What would your business look like if your customers, by law, could not go anywhere else?" (81 Wheelan). After reading this passage I continued to think about what it would be like. There would be no competition and products would be cheaper and workers would be payed less.

Eleanor Oakman: Chapter 4, Question 6

What I found most interesting in chapter 4 was when Wheelan brought up an example  about the slippery slope of having a good economy verses a safer environment. The chemical  DDT is used to spray over crops  to kill off bugs and is finding its way up the food system, most people would be against the harsh chemical, but surprisingly economists say different. Turns out it also decreases the chance of getting malaria! Because economists care about this so much is because if a malaria outbreak happens, the economy slows down due to all the money being used for health costs. I found this very interesting and wondered if it were a good idea to bring DDT over to Africa and spray it on their crops  to help weaken the malaria poisoning. I thought this was a very good example for me to understand about the effect of health costs to the economy and the significance  of a "safer environment" to the economy and the safety for people in the long run.

Jacky Xu,Chapter 3,Question 6

No one owns the air,so what should we do with the people who pollute CO2.People can't say that because the steel company is polluting,we will stop buying it's steel,because eventually you will need it.So the government comes.
People are smoking nowadays,of course it's bad for themselves,but it's also harmful for the people around him which have a huge externality.No one have the right to stop a person from smoking because it's his own will to become a smoker,so the government start to kick in and do things for the whole community:the government can raise the tax,decrease the smoker,and make much bigger social benefit.Now the government enter the market,instead of letting it go.Because there are laws and rules which restrict people and company.This bring the market to a new stage.

Jakcy Xu,Chapter 4,Question 5

"There are two broader lessons to be learned from this.First,government should not be the solo provider of a good or service unless there is a compelling reason to believe that the private sector will fail in the role."
   Just like the market thinking,it's control by a invisible hand.If a government try to control a good or service,for example house cleaning.All the people in the city will try to become one of the consumer,there will be just a long waiting list,to let everyone have the opportunity.
  However,sometimes government have to control good and service,for example,a drive license,if there is a company that let people have a test and give them the licenses,it will just end up if you have enough money,you can just buy one no matter you know how tho drive or not

Adam Hano, Chapter 4, Question 1

Charles Wheelan explains how government monopoly works (or doesn’t). Slovakia has few great examples for it. One of them is our trains for free. Our government decided to provide free trains across the nation for students and elderly. However, they provided it only through the national railway service and not through a private company. For the private company, which services and prices were much better than the states railways, was this decision devastating. They had to pump much more money into their services to maintain the same price. But still they are higher with price than 0 in national railways. The quality of national railways is really bad. Dirty, smelly, angry personal, late.

Second example isn’t from Slovakia but from yours homeland security. Waiting in line after 20 hours of traveling is incredible. They provided only 2 people to check full plane of international travelers. However, one of them was taking a coffee break. We waited in the line for 3 hours. The officers were just standing around and laughing, because everyone was going around their lines made out of strings, because people were too afraid to just cross them. Laughing personal and too long. Not very good first impression of the US.

Laura Bartz, Chapter 4, Question 5

One part that I found particularly interesting was when Wheelan was talking about the amount of restrictions that governments around the world impose of new businesses to be licensed. One example of how this doesn't work is the start of the Arab Spring. Tunisia imposed a licensing fee that was generally out of the price range for most business owners. So when the officials came around to different stands or businesses that didn't have the license they would bribe the officials and be able to stay open. There was a fruit stand owner who ever day would use all of the money he had to buy the fruit for that day to sell and repeat. So when the official came by to check if he had a license and he didn't he had nothing left to bribe the official with and all of his fruit to sell for that day was taken away. The fruit stand owner went to the different government buildings that he was sent to by the last one but he ended up getting so frustrated that none of them would listen to him, that to make people hear his story and know the corruption that was happening, he lit himself on fire. An extreme way of dealing with it, but it is a perfect example of how having a very heavily regulated system for new businesses doesn't work for a stronger economy.

Collis McKenzie, Chapter 4, Question 4

One of the more controversial subjects in chapter 4 is how much and what areas the government should be involved in. The problem with this topic is that there are valid points that could be made for every side of stance between very heavy government involvement and very light government involvement. Things like the military should obviously be left up to the government, but other areas like the postal service or schooling are more ambiguous because they are services that could be done by private firms at a higher quality. Government jobs such as the DMV have no reason or incentive to be as efficient as possible because no one else could do what they do, but anyone with a map and access to transportation could deliver a letter or package. Personally, I'm not sure whether I more support heavy government involvement or light government involvement because I feel like I don't have enough information yet to make a decision.

Bennett Pope, Chapter 4, Question 5

A passage I found interesting was the footnote about the difference between a raise in government tax revenue and a raise in government tax revenue compared to what it would have been without a change in the taxes. The difference is small, but profound. In the absence of a change in taxation rate, government tax revenue tends to rise. Say this amount that the revenue raises is a constant percentage (the book uses 5%). With a change in the taxation rate (whether it is higher or lower does not matter), the amount of tax revenue may increase from the amount before, while still being below the typical tax raise (in this case, <5%). This is a distinction one must make when analyzing the change in tax revenue relative to a change in tax rates. It is easy to get mixed up, or for politicians to glorify their "brilliant economic thinking," while in reality the change in taxes was ineffective.

Chapter 4 Question 3

Wheelan recalls another author in this chapter, Milton Friedman. Friedman wrote a book called Capitaism and Freedom. In the novel, Friedman recounts the exchange of a economist saying that the Amerian Bar Association should be made easier, so that people who aren't the top of the class or the smartest can still pass it and become lawyers, therefore creating more affordable legal services. I think this would be a great idea! The lawyers in the room that he said this too, did not. But I really like the analogy that this economist used. Lawyers are Cadillacs. They are super nice, but not everyone can afford them, and if the only kind of transportation then are Cadillacs, well then transportation rates will go down. I think that people should have the option to more affordable legal services, and it would also not discourage people from becoming lawyers, more people would be able to go for it and become lawyers. Also, you get what you pay for. If you aren't willing to spend a lot of money of legal services or you are not able, a mediocre lawyer is better than no lawyer at all.

Lauren Stevens, Chapter Four, Questions 4&5

Something that I really never thought about before was the point brought up in the first paragraph of chapter 4, the fact that the DMV is a government owned establishment and that is why they can make it a less than enjoyable experience. I never looked at it in this way, I just always assumed it was "DMV's are annoying just because of their nature." If you have a bad experience at the DMV, which many do, that is just too bad because thats you're only option.
     This effects not only my life, but every person who drives' life too. We all will sit in the waiting room for an hour or more, waiting for our picture to be retaken, or for other purposes. The people working at the DMV most likely realize that it is a government owned establishment, which tempts them to have shorter patients, and give worse customer service, because they know you will be back in a few years. This won't happen at a clothing store for example, because if you get bad service at one mall, you can just go to a different mall the next time.

Nathan Rowley, Chapter 4, Question 4

I found chapter four to be particularly illuminating on the subject of economic debate among average people. The points Charles Wheelan makes about supply-side economics are especially important to understanding just how uninformed most economic debate in the media is. Supply-side economics is the idea that cutting taxes can, at certain levels, actually increase government revenue due to increased productivity and investment in the economy. The key is the "certain levels" part. If the tax rate is low to begin with, as it is in the U.S. compared to other developed countries, the economy won't increase in productivity that much, and the government thus will not make more money. Unfortunately, the misconception that all tax cuts will increase government revenue is widespread among the American population, who seemingly would like any excuse to cut taxes. It is myths like the supply-side misconception that create sharp divides in the economic thinking of Americans. If economics were taught more like a science (and it is a science), i.e. taught to contain factual information that cannot be disputed, perhaps there would be fewer divisions in our society.

Caroline Paulsen, Chapter 4, Question 5

One passage that I found interesting in chapter 4 was about the use of DDT. Charles Wheelan points out that, while DDT is a chemical that is harmful to the environment, it is also a relatively cheap way to control malaria-spreading mosquitos. I didn't realize the extent of malaria until I lived in Kenya for half of sixth grade. While we were there, family and I slept under mosquito nets every night and took preventative pills every morning so that we didn't get malaria. Many people living in areas that are affected by malaria can't afford these measures, so while it may seem from an American perspective that DDT is simply a chemical that is detrimental to the environment, for many people it is more useful than it is harmful.

Jack McGillivray, Chapter 3, Question 5

I found what Wheelean said at the end of the chapter regarding the role of government to be extremely insightful. Often times people view government regulations as a nuisance that hinders the progress of capitalism. Personally I have never even considered the fact that government needs to regulate the internet. I have always taken for granted the fact that the internet works and that we are able to buy goods and services over it with little fear of fraud. I believe he was right when he said that the role of government is to band citizens together to do the things they cant do individually.

Jack Bexell, Chapter 3, Question 5

"If our employer automatically signs us up for some kind of insurance coverage, then we'll stick with that, even if six other plans are offered."

There is some giant truth to this. If someone is automatically signed up for an insurance coverage, they won't have to deal with other plans because there would not be any point to it. I personally would not have to worry about signing up for a different plan if I did not need to. I think we should actually do this. Less stress for everyone.

Collis Mckenzie, chapter 3, question 5

The passage about the umpire struck me as the best example for government involvement in markets. The referee is expected to make every call correctly and without bias, but this rarely ever happens.  Especially in a fast, contact sport like soccer, the referee can win or lose a game for a team. I remember last season we lost 3 games because of a terrible call that lead to a penalty kick. We may have disliked those refs, but we liked the position of the referee. He or she is a necessary part of the game that the sport could not function without.  We may lament when the government  implements a policy that seems unfair, but at the same time we need to recognize the other goods and services that are provided to us that we benefit from.

Yaphet, Chapter 3, question 1

Both positive and negative externatilities can effect us in our everyday lives both directly and indirectly. The book uses smoking as an example. Second hand smoking is a prime example of a negative externatilitie. One who chooses to smoke doesn't only effect themselves but can effect those that are near them.

Bennett Pope, Chapter 3, Question 1

I appreciated the reminder that Wheelan gives his readers about how good our government really is at regulating the economy both financially and legally. True, we have a long way to go, but in comparison to the rest of the world we are in a very good place. We often get annoyed with and caught up up in the arguments of the government over public issues, but the reality is that people in many places live without this type of control, and they pay for it. He gave the example of the civil wars caused by diamonds and oil in Angola. The influence of the government allows us to safely go about our days with consistency in the way things are run day by day. While we don't always notice it, the consistency is there, allowing us to fret far less then we would otherwise.

Chapter 3, Question 6

A passage that stuck out to me was the one with the story of the neighbor playing the bongo drums, explaining externalities. This lead me to then think of a similar issue we face at my work. At my store, there is a living space rented out on top. The people living there for the most part don't play a significant role, however, they are huge smokers and they don't just limit themselves to cigarettes. They tend to go outback and smoke, which then, if a door or window is open in our store, causes the entire first room to reek of smoke, upsetting the costumes. When my boss one time went out there to ask them if they could move, the crabby lady coughed back "You don't own the air." They also will smoke marijuana in their apartment above us, sending a skunky smell through the vents and into our store. When my boss brought this us they dined that they would do such a thing, but our noses told us otherwise. Both of these things (cigarettes and marijuana  are taxed or illegal, to try and limit this behavior and habit. However, the residents of the upstairs must be addicted and are still finding ways to buy supply of these resources. Taxing isn't the perfect method, no method really is, but it is something to try and hinder poor human behavior that affects other negatively.

Ingrid Snook, Chaper 3, Question 3

In this chapter, the author explains externalities and the positives and negatives of them. He proposes the solution of taxing negative externalities, which does kind of seem like a good idea. But he brings up the idea that the parties in an externality can come to a private agreement, as reference to Ronald Coase's study. The author puts Coase's explanation in a simple and relatable way by talking about his neighbor playing loud bongos. Bringing up difference scenarios such as paying his neighbor to be quiet seem like they'd be successful if you really wanted silence. But what if the neighbor wanted to pay to play his bongos, so he was essentially paying to be loud? It seems like this method could be successful, but knowing human nature it would seem almost impossible that people could come to an agreement. But I also think about what if playing bongos was Stuart's passion? How do you put a price on being allowed to play them? This situation may work for a few, but it looks like one private party might come out with more benefits then the other.

Laura Bartz, Chapter 3, Question 5

 A passage that struck me as particularly interesting was when Wheelan asks the question "Should government protect people from themselves?" Before reading this chapter I would have said yes on things like making drugs illegal and taxing cigarettes and alcohol simply because letting people do what ever they want can lead to them dying and nobody wants that. But after reading this chapter I now know that governments shouldn't merely save people from themselves because having a lower mortality rate is a good thing, but because those actions that the government is forbidding or making it harder to do don't just affect the person who is doing them, but they in fact negatively affect people around them and even people around the world. Smoking a pack a day of cigarettes doesn't just affect the person who is smoking them, it affects everyone around them. People who breathe in the second hand smoke, insurance policies going up, and even killing wild life from eating the cigarette butts. The government isn't merely saving you from yourself, they are in turn saving everyone else from you.

Caroline Paulsen, Chapter 3, Question 5

One theme in this chapter that I found disturbing, though not surprising, is the level of corruption and inefficiency in some governments. Charles Wheelan gives the Indian justice system as an example of an inefficient government. In India, cases can get delayed for generations due to inefficiency. While I was in Kenya, evidence of an inefficient and corrupt government was ubiquitous. Part of this was in the poor maintenance of public goods— for example, well-marked roads pretty much ended a little ways outside of Nairobi. Much of the corruption was influenced by the divisions between the different tribes. One woman that I talked to told me about how she had been threatened to vote a certain way in the upcoming election in order to keep a certain person (and therefore a certain tribe) in power.

Lauren Stevens, Chapter 3, Question 5

What struck me as significant and thought provoking was when he talks about taxing negative externalities such as driving an SUV. While this is a good idea because it inflicts an incentive for those considering buying an SUV to steer in a different direction (pun very intended), people will do it anyways. This brought me back to when he talked about taxing junk food/fast food earlier in the chapter. Taxing food that effects the body negatively is a good idea, however maybe making the healthier options cheaper, and the bad options more expensive would be more effective. Yes, fruits and vegetables are more expensive than processed meat products, but the money could be made back for the fruits and vegetables by making the junk food more expensive. This could be a different take on fixing negative externalities by setting a different incentive.

Adam Hano, Chapter 3, Question 1

In chapter 3 Charles Wheelan explains the need of Government to deal with externalities in Market.

First example he used is with large cars. He says that he bought a bigger car to be safer. However, the externality coming out of it is simple. Bigger emissions. I wonder why doesn’t the market work in this case? Why do people not react to other people giving higher cost to their living? If everyone would care about and think long term in this example, than the cost of buying a car would suit the exact cost, because people would put higher cost on other people buying the bigger cars.

Furthermore he provides a funny example of externality. The pleasure of seeing a nice view. I would have never considered it as an externality. It is simply there to see.

Eleanor Oakman: Chapter 3, Question 6

What I found really interesting in chapter three was when Wheelan brought up how the tax money the government has doesn't give it to the poor but they give it to middle class people with insurance and social security. I understand why they do this in the way that the government needs the middle class to keep safe (and working) but I also wished that they would give some of that money to the lower class. Where do they even get the money for lower class people who have insurance and social security. Or am I understanding this wrong? When people run for election they always say how important the working middle class is, first I thought it was because that was where they were hoping to get the majority of the votes to win. Now after reading chapter three I understand more, if we don't have the middle class the economy just doesn't work, there is a reason why the middle class is so important because if they stop working then both the upper and lower class can't function or get any assistance. This is one of the bigger this that I have learned through chapter three.

Matúš Kočalka, Chapter 3, Question 1

There was a passage in which the author focused on the problem of pollution.
He already repeated this sentence many times, but it applies also in this situation: "People act to make themselves better off." In the market, this sometimes means that people act despite of the hight external cost - pollution of waters, air, environment etc. They simply don´t care about the consequences, because they don´t need to - if there are no restrictions and thus they´re not forced to. (bad government).
This ideology - that people act to make themselves better off - applies also on the other side, in this case, on the victims. The regular citizen would rather buy products from the company that pollutes, because they sell it cheaper than the company that established several restrictions (in order to not pollute the environment) and therefore need to sell their products for the higher price since the production cost was higher. In this case, the negligent company gets the support and can continue act on behalf of the general sake.
So this is simply an issue that needs a governmental act. Moreover, it affects me directly and on a daily basis, because take for example China. They´re one of the world´s biggest producers of CO2. Even though their progress is obvious, and they belong among the greatest world´s leaders, what´s the cost? Global warming, sea level rising, higher amount of asthmatic people, allergies etc.                 The world is connected, and since I´m a part of it, it affects me as well.    

Nathan Rowley, Chapter 3, Question 3

Charles Wheelan presents the idea of externalities in chapter 3. As he mentions on page 55, "There is no market solution in this case; the market is the problem." Externalities are a problem intrinsic to the way markets function; if you have a market, you will have to deal with externalities. The real problem is that no individual has direct control over the actions of another; if they did, externalities would not happen. Fortunately, we have an institution that can handle the problem of externalities: the government. Although probably not originally contrived to control externalities, governments are large enough and powerful enough to regulate them. In a democracy, the government hopefully reflects the will of the majority, and so can speak with authority about what kinds of externalities will and will not be tolerated. And the government can enforce its decisions. Indeed, as Wheelan mentions, law enforcement and policing are almost exclusively carried out by governments. In a nutshell, government is the solution when the market is the problem.

Chapter 2, Question 3

Charles Wheelan  brings up the issue of traffic congestion and pollution issues that were prominent in London. The solution which economist in London came up with was to raise gas prices. This helped somewhat with the digestion of traffic. They then raised it even more and the reaction was immense! Traffic levels dipped by 20% and bus delay times were cut inhalf. By adding incentive for people not to drive as much, they were able to solve thier traffic problems. However, a comsiquence  stores didn't make as much revenue. This reminds me also when the gas prices in Minnesota were super low. It makes me ask why? Wouldn't that then increase driving and traffic and pollution? Did they do it to provide incentive for people to go shop more?

Jack Bexell, Hour 4, Question 5

"Raising prices reduces demand. Raising the cost of driving discourages some drivers and improves the flow of traffic."

I thought this stuck out to me because there was so much traffic last night for me and I was late for seeing my girlfriend before she went to church. The fact that sheer price changes could impact traffic kind of makes me wish that gas prices were emencely higher. I hate traffic a lot because I always forget to add it into my travel time.

Matúš Kočalka, Chapter 2, Question 1

In the text the author mentions the incentive concerning the minimum wage and social doles.

If people see, that having a stable job is actually not as profitable as being unemployed, they simply don´t work. This is basically happening because the government made the conditions for unemployed people very attractive – they get the minimum wage monthly, and they don´t need to spend “their precious” time in the work. Moreover, the conditions for getting the minimum wage by working aren´t very different from getting the social doles and being unemployed.

One of the main aftermaths of this problem is huge unemployment. The author remarks, that in this case the government wasn´t successful in working with incentive, and so there´re reasonable negative outcomes.

This is actually happening in Slovakia as well. We´ve got a huge rate of unemployment, because the minimal wages aren´t bigger comparing to the social doles (maybe by 20 Euros, and that´s nothing). Therefore the poorest people decided to stay on the doles, because it´s simply not beneficial to work. 

Adam Hano, Chapetr 2, Question 1

Charles Wheelan in Chapter two was arguing how important are incentives. I want to write about, how wrong incentives of other people impose bad incentives on myself.

               Charles mentions cheating with taxes. The bad incentive can be assumed to work also in cheating on exams. In Central European culture, cheating isn’t perceived as in the US. We are much more benevolent to cheating and getting credit for someone’s work. The problem in schools is simple to understand, but hard to solve. Kids are cheating to get better grades, so they can get to better universities. Teachers don’t have the capacities to control and catch every cheater. Furthermore Teachers cheat the state in bureaucracy because the paperwork is tremendous. So everyone is trying to bypass the system. Now if someone is trying to be honest and study for the test, he knows that he will not get as good grade as the cheater. So if some ambitious and honest student wants to get to a good university, he needs to decide whether he will cheat and get to it, or face the big probability of not getting into it. So bad incentives of Students to cheat, with the lack of control results in a bad incentive for honest students.

Jack McGillivray, Chapter 2, Question 5

One issue Wheelan discussed in this chapter was the over fishing of tuna, cod, swordfish and lobster. I was surprised how little the American fishers seemed to care about the populations of the fish. Not only is overfishing a conservation issue, but it's also their livelihood. If the fisheries become depleted they will be out of a job. However, the example of the lobster fishers in Australia that Wheelan brings up is encouraging. By forcing the fishers to own a license it makes them personally responsible. This discourages overfishing because it will ruin the value of their expensive licenses. Hopefully this policy will become widespread as it seems to be very effective. This chapter as a whole explored how people tend to act in a way the believe will benefit them, even if in the long run it hurts others, the planet, or even themselves.