Question 1

Income inequality is not a problem if it results from voluntary transactions in the marketplace, according to Nozick's entitlement theory.

Accepted Answer

According to Nozick's entitlement theory, if income inequality is the result of voluntary transactions in the marketplace, it is not a problem as it reflects individuals' different levels of productivity and contributions to society.

Question 2

Explain the central idea behind the Rawlsian maximin principle.

Accepted Answer

The answer of Explain the central idea behind the Rawlsian...

Question 3

Utilitarians are not concerned that transferring wealth to the poor reduces an economy's output.

Accepted Answer

Utilitarians believe in the maximization of overall happiness and well-being, but they also acknowledge the importance of a thriving economy to support these aims. Therefore, they are concerned with reducing poverty and inequality, but not at the expense of overall economic growth and stability. Thus, they would not support policies that significantly reduce an economy's output.

Question 4

Utilitarians favor redistribution schemes that maximize total utility in society.

Accepted Answer

Utilitarians believe in maximizing overall happiness and well-being in society, which may involve redistributing resources and wealth to achieve greater equality and reduce suffering.

Question 5

The practical limit of income redistribution is incentives that affect how much the wealthy earn.

Accepted Answer

If income redistribution policies such as progressive taxation and social welfare programs are too aggressive, they can disincentivize the wealthy from working hard and investing in the economy. This can lead to reduced economic growth and lower overall tax revenues, which in turn can limit the effectiveness and sustainability of income redistribution efforts. Therefore, there is a practical limit to how much income can be successfully redistributed without negatively impacting the economy and the incentives of the wealthy.

Question 6

Suppose you were advocating Larry Summers's view that pollution should be exported to less-developed countries. Explain how this could lead to increased economic growth in both sets of countries.

Accepted Answer

The answer of Suppose you were advocating Larry Summers's view...

Question 7

Think of an example, other than the market for human kidneys, that is illegal because it is believed to be exploitative? Make two arguments-first, that this market is exploitative and should be illegal; second, from an economic point of view, that the market does not exploit and should be legal.

Accepted Answer

The answer of Think of an example, other than the...

Question 8

Briefly describe the three views that have proven influential in judging the distribution of wealth in economies.

Accepted Answer

The answer of Briefly describe the three views that have...

Question 9

Nozick argues that voluntary, peaceful trades that lead to income inequality are to be condemned as unjust actions.

Accepted Answer

Nozick takes the position that voluntary, peaceful trades that lead to income inequality are not inherently unjust, as long as they are conducted fairly and without coercion. He argues that individuals have the right to acquire property through just means, including through the market, and that attempts to redistribute income or property through taxation or other means violate individuals' rights to their own property.

Question 10

Explain how economic reasoning may fail to address the issue of fair and equal treatment.

Accepted Answer

The answer of Explain how economic reasoning may fail to...

Question 11

In economics, there is a concept called Pareto optimality. This is the concept whereby parties trade until neither one can be made better-off without making the other worse-off. At that point, both parties are said to have reached a state that is Pareto optimal. Do you think the market for kidneys enjoys Pareto optimality? Why or why not?

Accepted Answer

The answer of In economics, there is a concept called...

Question 12

When it comes to redistribution, a utilitarian approach tries to determine which people can generate the greatest income with additional utility.

Accepted Answer

The answer of When it comes to redistribution, a utilitarian...

Question 13

Accepted Answer

The answer of ...

Question 14

Robert Nozick advocated the importance of assessing the distribution of income in a country in order to decide whether an economic system is just or not.

Accepted Answer

The answer of Robert Nozick advocated the importance of assessing...

Question 15

Robert Nozick's entitlement theory is a pro-free-trade theory.

Accepted Answer

According to Nozick's entitlement theory, individuals are entitled to the fruits of their labor and are free to voluntarily exchange those fruits with others. This includes free trade, as individuals are entitled to the property they have acquired through free trade. Therefore, Nozick's theory supports free trade.

Question 16

List the six practical problems of economic reasoning that need to be examined.

Accepted Answer

The answer of List the six practical problems of economic...

Question 17

Consider the market for human kidneys. Using supply and demand, graphically illustrate how the price of $0 is affecting the legal market for kidneys. Assume that a small number of kidneys are donated for free each year.

Accepted Answer

The answer of Consider the market for human kidneys. Using...

Question 18

Discuss the role for government if markets fail to provide fair and equal treatment? Explain.

Accepted Answer

The answer of Discuss the role for government if markets...

Question 19

Based on your reading of the text, briefly list some of the objections that exist against standard economic reasoning.

Accepted Answer

The answer of Based on your reading of the text,...

Question 20

The concept of utility could refer to ―happiness‖ or ―satisfaction.‖

Accepted Answer

The concept of utility in economics refers to the satisfaction or happiness that a consumer derives from consuming a particular good or service.

Quiz 20: Political Economy and Public Choice