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9 Mar 2019

Globalization and global trade have led to increased competition in world markets and increased efficient allocation of scarce resources.

Is it accurate to say that this is contributing to increased consumer surplus and reductions in inflationary pressures?

If yes, how (explain using economic concepts and terms how it is occurring)?

Globalization and global trade have led to increased competition in world markets and increased efficient allocation of scarce resources.

Is it accurate to say that this is contributing to increased consumer surplus and reductions in inflationary pressures?

If yes, how (explain using economic concepts and terms how it is occurring)?

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Reid WolffLv2

10 Mar 2019

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Purpose of Assignment

In Week 2, students will employ the supply and demand model to develop consumer surplus and producer surplus as a measure of welfare and market efficiency. Students learn about welfare economics--the study of how the allocation of resources affects economic well-being--and will discover that under most circumstances, the equilibrium price and quantity is also the one that maximizes welfare. Students will review different sources of externalities and a variety of potential cures and will see that while markets are usually a good way to organize economic activity, governments can sometimes improve market outcomes. Students will see how the U.S. government raises and spends money and the difficulty of making a tax system both efficient and equitable.

Assignment Steps

Scenario: Imagine you have been assigned the responsibility of preparing a paper for the governor's next economic conference.

Prepare a 1,050-word paper addressing the following:

Explain why equilibrium of supply and demand is desirable.

Explain the following concepts using the concept of consumer and producer surplus:

Efficiency of markets

Costs of taxation

Benefits of international trade

Discuss how externalities may prevent market equilibrium and the various government policies used to remedy the inefficiencies in markets caused by externalities.

Analyze the difference between the efficiency of a tax system and the equity of a tax system as it refers to the costs imposed on taxpayers using the benefits principles.

Cite a minimum of three peer-reviewed sources, not including your textbook.

Format consistent with APA guidelines.

rosegerbil765

what you think for this ? do you agree or disagree and why ?

I donât think itâs wise for nations to begin raising tariffs and increasing subsidies when we are faced with a global recession. If a smaller country raises tariffs on a good they are importing, it might not have that big effect on the global economy. However, if a country like China, Japan, United States etc. decide to raise tariffs on imports, it could lead to a global increase in the average tariffs. In the article âBarriers to entry: A rise in protectionism would worsen the already grim outlook for world trade,â it talks about the worldwide average for tariffs. In 1986 they average 26%. If the big economies of the world start increasing tariffs, the rest of the world will eventually follow, leading to a global increase on tariffs. A rise in the tariffs would slow down the global economy even more in the long run. In the article it mentions how trade has picked up immensely when tariffs are lower, and the world GDP was higher compared to when tariffs are increased because countries are more willing to trade. I think theyâre still benefits to be gained from trade even when a global recession may be taking place. If tariffs are increased, countries might try to specialize in goods where they donât have a comparative advantage in. Instead of trading for that good, they will try to produce it domestically. The opportunity cost of choosing to specialize in a good when they donât have comparative advantage is using those resources elsewhere. Perhaps for producing a good they do have comparative advantage in. Also a decline in trade because of rising tariffs means firms wouldnât be able to benefit from economies of scale.

Hello, could I get some assistance with this question? Thank you.

Read the articles and discuss the problems of Economic Inequality in the U.S.economy, summarize key points and post in the Discussions area:

3) Inequality. On important but irrelevant facts

http://www.economist.com/blogs/freeexchange/2014/01/inequality-0?zid=293&ah=e50f636873b42369614615ba3c16df4a

Here is the article:

Inequality

On important but irrelevant facts

Should we care more about global or national inequality?

Free exchange

Jan 9th, 2014

by R.A. | LONDON

WRITING on Thomas Piketty's new book, Nicolas Goetzmann notes:

I think that Piketty missed something which might be important: Capital is mobile, workers are not, and in the end, we have this: Gini is reducing on a worldwide basis since 2005.

Scott Sumner adds:

I also like Goetzmann's comment about global Gini coefficients. Liberals should care about global welfare. Are they closet nationalists?

These sorts of remarks are common responses to those pointing out that inequality is soaring across the rich world, and they strike me as very problematic.

It is true, of course, that inequality globally has been falling. And it is absolutely right to say that this trend is hugely important and is contributing to a massive rise in global welfare. We should all be ecstatic about it. But in no way does that development excuse us from caring about and worrying about national income inequality, for a few very important reasons.

The first is that it implies, without ever making an actual argument, that efforts to reduce income inequality within rich economies must necessarily slow reductions in global inequality. Why bring up the global statistic unless you are worried that expressions of concern about national inequality are likely to undermine the global trend? Some egalitarian-minded policies might, of course, but many others would not. I'm not sure why someone would want to stake out the position that subsidized pre-school for disadvantaged children is unnecessary, for example, because global inequality is falling.

Second, while we all should care about welfare globally, we should also recognize that the political salience of the issue is exclusively national. To a first approximation, America's Congress does not care in the least about the status of global inequality. There are no sitting congresspersons from Burundi. National inequality, by contrast, is highly politically relevant. Catch-up in the emerging world has a lot to do with innovation and openness in the rich world. If soaring national inequality undermines political support for policies that facilitate innovation and openness, that's a problem for everyone. It's a pretty basic political economy point that globalization will continue while national polities feel that globalization is broadly in their interest. People who like globalization should therefore be very, very concerned when it doesn't appear to be generating broad-based growth in rich countries.

The third is that inequality is growing within emerging markets. One might be inclined to argue that we shouldn't worry too much about that, since rising inequality is a classic side-effect of rapid development which should go away as emerging economies mature. But one of the most important points in Mr. Piketty's book is that the conventional wisdom that development naturally increases and then reduces inequalities is wrong: the data show that there is no systematic tendency for inequality to fall as an economy matures.

And so we should note that the backlash to globalization and development might well come from within emerging markets, and indeed one would have to be fairly cut-off from the news to miss populist expressions of dissatisfaction across the biggest emerging economies over the past couple of years. What's more, Mr. Piketty's work suggests that as the process of catch-up slows inequality trends within countries will begin to dominate inequality trends across countries, leading global inequality to rise once more.

So yes, global inequality has been falling. That is no reason for people of any ideological persuasion to ignore very worrying trends in national distributions of income and wealth.