ECON 10223 Lecture Notes - Lecture 9: In Kind, Natural Monopoly, Externality
Document Summary
Private goods: rival and excludable, if you are wearing it no one else can, there is one less for everyone else. Externalities: positive or negative effects on the people around you, 1st, 2nd hand. Government sponsored good: government provides something in order to give people incentive to do something. Monopoly: when company controls the whole market, if we own all the oil then we can have a monopoly. Natural monopoly: when it is more efficient to have one provider of a good of service and average total cost falls over time. Social security: a retirement safety, employees and employers both pay. Meant to be a backup but is way overused. In-cash: you can use it for whatever-security, unemployment. In- kind: you have to use it for the purpose- food stamps, medicare. Medicare: government picks up bill for a procedure. Free-rider problem: people use resources like social security even though they did not pay the tax.
