Why does the government impose price floors or price ceilings? Why do price ceilings below market price create shortages? Why is the cost of living continually increasing? Why do firms lose competitiveness with a home currency depreciation?
I do so by setting up a public choice model: It assumes a local government which does not necessarily maximize city welfare. In addition to the costs and benefits from mitigation, which scale with city size, the model considers the political preferences of its constituency (e.g. expressed by...
Why does competition among traders affect how much of the gains from trade are given to the countries involved in the trade? Explain why the application of tariffs to Chinese imports will not improve the U.S's trade deficit. Why do price floors and price...
Why might consumers not prefer a lower price ceiling price (say of $5) to a higher equilibrium price of $8? Why does the government impose price floors or price ceilings? Why do governments apply price ceiling and price floors if it ca...
Between 1980 and 1990, for example, the population of metropolitan Chicago grew only 4 percent while the city government gained authority over 40 percent more land. The exodus of industry and people has left more than 31,000 vacant lots in Philadelphia, and 70,000 in Chicago; in Trenton an...
In order to help the towns like Pedro Garcia, the government stepped in with a reforestation program to bring the coffee trees back. Towns like Pedro Garcia are uniquely suited to grow the particular variety, Arabica Tipica, given the climate, altitude and the canopy required. Coffee Tree ...
Recent government regulations such as price ceilings and more stringent eligibility requirements for new home buyers have put the brakes on China’s high-flying real estate sector. And with government prohibiting developers from borrowing from China’s enormous shadow banking sector, ...
A plant closes. A street gang moves in. A government goes crazy with taxes. An environmental disaster happens nearby. We could have an investment that not only crushes it’s owner’s net worth, but does so even as they are losing their job and income!
Physical gold is the only asset that does not suffer from default (counterparty) risk. Gold protects wealth against inflation, government fiscal and monetary policy, and sudden geopolitical and economic shocks (such as war or stock market collapses). Physical gold is preferable in some ways for ...
The government pays for your education up to PhD level. You get given a free house when you get married. You get free healthcare, and if it’s not good enough here, they pay for you to go abroad. You don’t even have to pay for your phone calls. Almost everyone has a maid, a...