Naked Economics: Undressing the Dismal Science pdfdrive com
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Naked Economics Undressing the Dismal Science ( PDFDrive )
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- Will we use the market in imaginative ways to solve social problems
particularly for youth. The American system is a richer, more dynamic, more entrepreneurial economy—and harsher and more unequal. It is conducive to creating a big pie in which the winners get huge slices. The European system is better at guaranteeing at least some pie for everybody. Capitalism comes in all kinds of flavors. Which one will we choose? Will we use the market in imaginative ways to solve social problems? The easiest and most effective way to get something done is to give the people involved a reason to want it done. We all nod, as if this were the most obvious point in the world—and then we go out and design policies that do just the opposite. We have an entire public school system that still does not really reward teachers and principals when their students do well (or punish them when their students do poorly). We talk about how important education is, but we make it difficult and time-consuming for smart people to become teachers (despite evidence that this training has little impact). We don’t pay good teachers more than bad ones. We make it artificially cheap to travel by car, implicitly subsidizing everything from urban sprawl to global warming. We assess most of our taxes on productive activity, like work, savings, and investment, when we might raise revenue and conserve resources with more “green taxes,” such as a tax on carbon dioxide emissions. If we get the incentives right, we can use markets to do all kinds of things. Consider the case of rare diseases. However bad it is to have a serious illness, it is worse to have a serious illness that is also rare. At one point, there were some five thousand diseases considered so rare that drug companies ignored them because they had no hope of recovering their research costs even if they found a cure. 2 In 1983, Congress passed the Orphan Drug Act, which provided incentives to make such work more profitable: research grants, tax credits, and exclusive rights to market and price drugs for rare diseases—so-called orphan drugs—for seven years. In the decade before the act, fewer than ten orphan drugs came to market. Since the act, roughly two hundred such drugs have come to market. Or something as simple as deposits for cans and bottles. Not surprisingly, recycling rates are much higher in states with deposits than in states without. There is also less trash and litter. And if landfill space is at a premium—which it is in most places—shouldn’t we be paying to dispose of our household trash based on the volume we generate? What effect do you think that would have on the quantity of consumer packaging? Markets don’t solve social problems on their own (or else they wouldn’t be social problems). But if we design solutions with the proper incentives, it feels a lot more like rowing downstream. Download 1.74 Mb. Do'stlaringiz bilan baham: |
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