經济学概论第章供给需求与政府政策.pptVIP

* This case study shows students an interesting real-world example of the material they just learned. If you’re pressed for time, it is probably safe to skip it and let students read it on their own. It does not introduce any new concepts, and most students do not find it difficult to read. * Demand for yachts (and other luxury items) is price-elastic: if the price of yachts rises, rich consumers can easily avoid the tax by spending their millions on some other luxury item. Supply of yachts is less elastic, especially in the short run. It is difficult for the companies that build yachts to re-tool their factories and reeducate their workers to produce some other product. Hence, companies that build yachts pay most of the tax, and the rich pay relatively little of it. The same is true for taxes on other luxury items. * Recall one of the 10 principles from Chapter 1: Markets are usually a good way to organize economic activity. This means that, in absence of market failures (which we will learn more about in later chapters), the allocation of resources resulting from the free market equilibrium is optimal. Hence, government policies which alter this allocation tend to make the economy worse off. When we study market failures later, we will see that government policies can – in principle – improve on the market’s allocation of resources, and make society better off. First, though, we need to learn how to measure the impact of government policies like taxes on society’s well-being, as well as define what, exactly, we mean by “well-being.” This field of study, called “welfare economics,” is the topic of the following three chapters. * Recall one of the 10 principles from Chapter 1: Markets are usually a good way to organize economic activity. This means that, in absence of market failures (which we will learn more about in later chapters), the allocation of resources resulting from the free market equilibrium is optimal. Hence, government