Project Introduction:
Research and analyze the effects of the following government policies on the market equilibrium.
1. Increases in the Minimum Wage
2. Restrictions on International Trade
3. Pollution Controls
4. Natural Monopolies and Anti-Trust Regulation
ES2550: Project Page 5
When analyzing these policies, include some discussion of the following points when appropriate:
A. What is the purpose of the policy?
B. Provide the rationale for the government policy. In this section, discuss how asymmetric information creates a need for the policy.
C. Note 1: The necessity of the policy should be related to the purpose.
D. Note 2: A discussion of asymmetric information should include defining how the information is unequal between consumers and producers as well as any adverse selection or moral hazard issues involved.
E. The welfare of consumers, producers, and society (the winners and losers) before and after the policy.
F. How does this policy affect the fairness of the distribution of costs and benefits?
G. Does government intervention improve the situation?
Note: Discuss whether government intervention affected the asymmetric information problem, adverse selection, or moral hazard previously discussed.
Project Introduction:
Research and analyze the effects of the following government policies on the market equilibrium.
1. Increases in the Minimum Wage
2. Restrictions on International Trade
3. Pollution Controls
4. Natural Monopolies and Anti-Trust Regulation
ES2550: Project Page 5
When analyzing these policies, include some discussion of the following points when appropriate:
A. What is the purpose of the policy?
B. Provide the rationale for the government policy. In this section, discuss how asymmetric information creates a need for the policy.
C. Note 1: The necessity of the policy should be related to the purpose.
D. Note 2: A discussion of asymmetric information should include defining how the information is unequal between consumers and producers as well as any adverse selection or moral hazard issues involved.
E. The welfare of consumers, producers, and society (the winners and losers) before and after the policy.
F. How does this policy affect the fairness of the distribution of costs and benefits?
G. Does government intervention improve the situation?
Note: Discuss whether government intervention affected the asymmetric information problem, adverse selection, or moral hazard previously discussed.
