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Lecture 13-14: Welfare and Social Choice
Charit Tingsabadh M.Sc. Programme in Environmental and natural resource economics Semester 1/2006
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Outline From positive economics to normative economics
What is being compared Measures of welfare Examples Empirics
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Subsidy: a payment for the pruchase of a good; the opposite of a tax.
Key Concepts Consumer surplus: the difference between what consumers are willing to pay and the price they pay for it. Calculated as the area under the demand curve and above the market price up to the quantity consumers buy. Producer surplus: the difference between the amount for which a good sells and the minimum amount necessary for sellers to be willing to produce the good. Deadweight loss: a net reduction in welfare from losses of surplus by one group that are not offset by gains to another group. Subsidy: a payment for the pruchase of a good; the opposite of a tax. Tariff: a tax levied on imported goods. Quota: a statutory limit on the amount imported. Rent seeking: effort and spending done to gain rent or profit from government action.
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Applying the Competitive Model Perloff, Microeconomics 3rd edition
Chapter 9 Applying the Competitive Model Perloff, Microeconomics 3rd edition
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Figure 9.1 Consumer Surplus
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Figure 9.1a Consumer Surplus
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Figure 9.1b Consumer Surplus
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Figure 9.2 Fall in Consumer Surplus From Roses as Price Rises
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Table 9.1 Effect of a 10% Increase in Price on Consumer Surplus (Revenue and Consumer Surplus in Billions of 1999 Dollars)
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Page 278 Solved Problem 9.1
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Figure 9.3 Producer Surplus
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Figure 9.3a Producer Surplus
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Figure 9.3b Producer Surplus
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Page 281 Solved Problem 9.2
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Figure 9.4 Why Reducing Output from the Competitive Level Lowers Welfare
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Figure 9.5 Why Increasing Output from the Competitive Level Lowers Welfare
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Figure 9.6 Effect of a Restriction on the Number of Cabs
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Figure 9.7 Welfare Effects of a Specific Tax on Roses
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Figure 9.8 Welfare Effects of a Per-Unit Subsidy on Roses
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Figure 9.9 Effect of Pricing Supports in Soybeans
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Page 298 Solved Problem 9.3
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Page 300 Solved Problem 9.4
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Figure 9.10 Loss from Eliminating Free Trade
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Figure 9.11 Effect of a Tariff (or Quota)
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Table 9.2 Welfare Cost of Trade Barriers (millions of 1999 Dollars)
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Externalities, Commons, and Public Goods
Chapter 18 Externalities, Commons, and Public Goods
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Figure 18.1 Welfare Effects of Pollution in a Competitive Market
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Table 18.1 Industrial CO2 Emissions, 1998
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Figure 18.2 Taxes to Control Pollution
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Figure 18.3 Cost-Benefit Analysis of Pollution
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Application (Page 634) Emissions Standards for Ozone
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Figure 18.4 Monopoly, Competition, and Social Optimum with Polution
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Table 18.2 Property Rights and Bargaining
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Table 18.2a Property Rights and Bargaining
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Table 18.2b Property Rights and Bargaining
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Table 18.2c Property Rights and Bargaining
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Table 18.3 Rivalry and Exclusion
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Figure 18.5 Inadequate Provision of a Public Good
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Table 18.4 Private Payments for a Public Good
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Table 18.5 Voting on $300 Traffic Signals
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Cross-Chapter Analysis (Page 657) Emissions Fees Versus Standards Under Uncertainty
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