Interesting Articles and Current Events
Principles of
Microeconomics – Economics 1014 - Ryan
The following are
postings of Wall Street Journal
articles, summaries of economics research and other interesting and relevant
news items that you might find useful in this Introductory Microeconomics
course. I’ll add additional materials to the list as I locate them.
ARTICLES TO BE
READ WITH CHAPTER 1 OF THE TEXTBOOK
Vengeance is Mine, Sayeth the Lord – But Scientists
Differ
This is a short article from the Wall Street Journal discussing the continuing discussion and research among economists into the ways that people act and react in economic markets. The question is whether people are always rational and whether for some people a sense of justice causes them to make decisions to punish others in the market even though the decision might personally hurt them financially.
Balancing Act: Lives vs Regulations
This is an article from The Wall Street Journal which deals with Cost-Benefit Analysis on the federal level as well as with the difficulty users of this type of analysis actually have with determining a monetary value for many of the benefits and costs we have to deal with.
This is an article from The Wall Street Journal which deals with how each of us has to use implicit cost-benefit analysis in order to make good decisions. It gives a nice form for doing an explicit cost-benefit analysis and nicely discusses the difficulties we each face when evaluating the worth of our time.
Erbitux’s
High Price Raises Difficult Questions
This is an article from The Wall Street Journal which discusses using cost-benefit analysis to determine the wisdom of a costly drug-treatment program. Remember that if resources are not scarce any treatment that extends life, even if only by a few months, is worthwhile regardless of the cost. However, when resources are scarce, spending resources on this treatment means shifting resources away from other beneficial uses. In this case, we do have to consider both the costs as well as the benefits when deciding on the wisdom for society of funding this treatment.
The Economist versus the
Terrorist
This article from The Economist discusses the importance of considering economic factors even when discussing poverty, war and terrorism. After all, if people are happy and have a lot to lose in a war or a terrorist act, are they as willing to take move forward with violence? If each of us considers the benefits and costs, then the poor are more likely to engage in war and terrorism because they have very little to lose, so the MC is very low for them. This means that proposals to help countries around the world become economically stable have the potential to make the world safer as well.
How Do You Keep The Public
Shopping? Just Make People Sad
This article from The Wall Street Journal discusses how emotions can influence our perceptions of marginal costs and marginal benefits. It’s an interesting result from the growing field of behavioral economics, which tries to understand how emotions influence market decisions.
ARTICLES TO BE
READ WITH CHAPTER 2 OF THE TEXTBOOK
China’s Inflation Weapon:
Price Controls beat Raising Interest Rates, but Shortages Result
This is an article from The Wall Street Journal which deals with the transition of a command economy (centrally planned) to a market economy. It is interesting both because it discusses the economic ramifications of price controls as well as the type of cost-benefit analysis a government must do when deciding whether or not to interfere in a market.
Why
We’re Not Having Enough Babies
This article was pointed out to me by a student who came across it and noticed that it dealt with the same population problem we discussed in class. It goes on to discuss the problem in economic terms, mentioning that the “opportunity cost” of having children is the real problem here. The article is on the MSN Money web page.
ARTICLES TO BE
READ WITH CHAPTER 3 OF THE TEXTBOOK
Trade Balance: Tipping
Scales to Help Workers
This is an article from The Wall Street Journal which deals with the inefficiency of trade restrictions by calculating the dollar cost to consumers as a result of steel import restrictions.
How an Addiction to Sugar
Subsidies Hurts Development
This is an article from The
Wall Street Journal which discusses the cost paid by small sugar producers
in Africa as a direct result of French and US subsidies to wealthy (and
economically inefficient) domestic sugar producers. It gives an interesting spin
to any discussion on EU and
IBM Documents Give Rare
Look At Sensitive Plans on “Offshoring”
This article from The
Wall Street Journal discusses the increasingly controversial policy of
firms (especially computer and other tech firms) to save money by sending
customer support jobs overseas. In the case of IBM, even highly-paid
programming jobs are being sent to low-wage countries overseas, because these
countries increasingly are able to provide the trained and skilled workers.
This eliminates the need to locate the company overseas and eliminates the need
to move the workers to the
ARTICLES TO BE
READ WITH CHAPTER 4 OF THE TEXTBOOK
Energy Crunch: Avoiding
Future Shortages Demands Crucial Choices Now
This article from Scientific American deals with the importance of recognizing the role played by price in the rationing of scarce resources. It also implicitly illustrates why economic training is important even for non-economists. The article should be read when we are covering the demand and supply material.
ARTICLES TO BE
READ WITH CHAPTER 5 OF THE TEXTBOOK
ARTICLES TO BE
READ WITH CHAPTER 6 OF THE TEXTBOOK
FDA Goes After Counterfeit
Drugs
This article from The Wall Street Journal deals with a possibly justified government intervention in the market. Economists generally dislike government intervention because of the reduction in efficiency, but when good product information is difficult for consumers to obtain, government intervention designed to improve information may actually increase market efficiency. This article should be read when we deal with markets and demand and supply.
Hey Buddy, Wanna Score Some Cheese?
This is an amusing article from The Wall Street Journal describing the efforts of consumers to get around government intervention they disagree with. If consumers feel they get benefit from a product which exceeds the cost, they will make every effort possible to get that product. They will be able to find a producer if the benefits of providing the product exceed the cost. It is difficult for the government to outlaw a market when consumers and producers want to trade. This article should be read when we deal with markets and demand and supply.
ARTICLES TO BE
READ WITH CHAPTER 9 OF THE TEXTBOOK
This is a fun article from Archaeology which discusses the external costs imposed on
bystanders by others wanting to enjoy
ARTICLES TO BE
READ WITH CHAPTER 13 OF THE TEXTBOOK
The Pillow Chiller: Housewares You Never Knew You Needed
This article from The Wall Street Journal discusses new product innovations. It is a nice example of how our free market system works to force firms to innovate to come up with new and better products for consumers and it also illustrates how wonderfully the free market system works to answer the question, “What should we produce?” We should produce what people want. Free markets do a good job of this because businesses always have an incentive to find out what consumers want since this is how businesses make money. Look at the list of new products being introduced and imagine how hard it would be for a central planner to come up with these same viable ideas.
This article from The Wall Street Journal illustrates the type of product innovation and product differentiation that occurs in monopolistically competitive markets. Firms need to find some way to convince consumers that their product is different and better in order to gain some market power. It also shows how hard they work at trying to figure out ways to produce products that consumers will really value.
MISCELLANEOUS
INTERESTING ARTICLES
Wife Ousts Warlord in
Liberian Crusade
This article from the Columbia Missourian is not really economically relevant. I
simply found it interesting and amusing.
Summary: Do Economists Make Better Lawyers? Undergraduate Degree Field and Lawyer Earnings.
This is a brief summary of the article published in the Journal of Economic Education. It looks at the earnings of lawyers and judges with economics undergraduate degrees compared to the earnings of lawyers and judges with other undergraduate degree fields.