What did you find interesting or uninteresting about the piece? Was there something that seemed intuitive or counterintuitive? Explain.
One of the first things we learned in this class was that values are subjective. As simple as this idea is, it always pops into my head whenever I read anything pertaining to economics. There's certainly a lot of frivolity present in today's market, but it's only there because people are consuming it. There's a supply of it because there's a demand for it. Do people really need flashy, expensive cars? No, however, if they're willing and able to pay for them, then a quantity demanded exists. It's interesting to suggest that people should limit their consumption to only the necessary things they need for survival. It's Communist-esque in the sense that goods are rationed by capping expenditures, but unlike it because the people would still have excess income that they weren't allowed to spend. This is similar to self-sufficiency being the road to poverty, and the importance of fair trade. People would just be sitting on their money without the ability to enter it into the market, making everyone poorer. Prohibiting exchanges impoverishes us.
Discussion Questions
What are some possible repercussions of enforcing the rule against frivolous spending? Who would benefit/suffer the most from a policy like this? Are there any positive unintended outcomes that could come about from the implementation of such a strategy?
Annotation
Market supply molds to fit the market demand. If consumers want trivial tangible items, then they'll be created. It doesn't necessarily mean that people are "wasting" their money. Restricting the purchases of such goods won't promote any sort of economic equality because other ways to distinguish one's self will emerge. Free trade makes all of us richer on net, so prohibiting certain exchanges will make us poorer because entire sectors of the market would disappear. Freedom of purchase coupled with competition allow our economy to thrive.
No comments:
Post a Comment