Econ Discussion Question

Reply to the passage below. No more than 2 pargraphs. 

When focusing on prices with goods or services, prices reflect scarcity in a market economy meaning that resources are not unlimited. When the quantity demanded exceeds the quantity supplied, the good or services are said to be scarce. For example: the value of highways, this  focused area includes time spent in transit, vehicle operating costs, congestion and toll booths.  In reading the essays in Miller, the scarce good is highway travel and when the money price of travel is zero, something else must be used to ration the quantity of the good demanded. The “something” here that rations travel demand is reflected as “time”, which is exemplified in some states such as New York, Seattle, Los Angeles, and Atlanta where motorist are caught in traffic. In addition, the spread of tolls has meant improved economic efficiency, and the revenues from them have reduced pressure to raise taxes to pay for roads.                                      

When addressing heroin, the government seeks to prevent voluntary exchange which means it must generally decide whether to go after the seller or the buyer. The government targets sellers, because this is where the authorities get the most benefit from their enforcement dollars. A heroin dealer, even a small retail pusher, often supplies many dozens of users each day. By incarcerating the supplier, the police can prevent several, or even several hundred, transactions from taking place, which is usually much more cost-effective than going after the buyers one by one. Law enforcement activities directed against the suppliers of illegal goods increase the suppliers operating costs. The risks associated with this are fines, jail sentences, and possibly even violence that become part of the costs of doing business and must be taken into account by suppliers. The legal penalties for the users of illegal goods encourage suppliers to use more potent forms and to use them more intensively. Which is even worse because it yields a deadly combination.

Energy revolution in regards to  natural gas and water is upon us. For an overwhelming number of people, fracking seems to promise an improvement in the quality of their lives. Energy costs and air pollution are reduced, and American industry is made more competitive in world markets.While some people feel that the situation is “all fracked up”, it seems that on balance this innovation in natural gas production will leave most of us both healthier and wealthier. Nevertheless, natural gas is also a complement for other goods. Their demands rise when the price of natural gas falls.

For medicinal purposes, allowing payments for human organs is almost surely a safe and remarkably cheap way to alleviate needless suffering and save thousands of lives every year. According to our reading, this year alone around 7,000 Americans will die waiting for an organ transplant. They will not die because physicians are unable to transplant organs or because their health insurance does not cover the cost of the transplant. They will die because since 1984, it has been against federal law to pay for human organs. Nevertheless, experts have estimated that even if the payment for a kidney were as much as $100,000, private and public insurance systems (which, as we have noted, pay for almost all of the transplants in the United States) could actually save money on many transplants because dialysis (at 80,000 per year) and other treatments associated with chronic kidney disease are so expensive. It is true that allowing payments for human organs would almost surely increase the number of transplants each year indeed, this is the very point. Payments would bring forth more organs, and this would in turn reduce deaths among people waiting for transplants.

Works cited

Miller, R. L., Benjamin, D. K., & North, D. C. (2015). The economics of public issues(19th ed.). Boston: Pearson.