Reading Analyiss #7 "Property Rights" (10/23/2011)

A)
     Property Rights is what makes JUSTICE possible! Private Property Rights are necessary in this world economy as well as institutions. For a market economy to exists  private property rights are necessary. I really find this reading interesting since we all give property rights for a fact and don't notice their great importance and role in the economy. The institutions are what allow each individual to pursue it's own gaols and ends without anyone interfering in their way. However, without us interifiring in anybodies way. Something that I might think is intuitive is that a common resource will be overused without the existence of rules or regulations since nobody will desire to preserve the resource if no one owns it. Additionally goverment can inter fear with property rights by taking property without compensation. Some points that I found interesting were like property owners suffer the consequences of bad decisions. However, a counter-intuitive argument that I found through this readig was that property rights make wealth possible. Since I thought that this is what makes poeple not acquire what they want how they want but it makes things harder ot obtain. However, I did not realize that they allow trade peacefully among people by substituiting contructive competition for destructive competition.


B)

1. Evaluate the argument: "Allowing the goverment to interfere in property rights will give the authority to argue in how a person should use his/her resources?" (Will this be quivelent to communism)
2. If Private Property Rights are what allow trade and this did not exist before. How did people trade before? (I believe PPR helps trade but not entirley)
3. If we still see people acquiring things be violent means, does this means that PPR is not working and they should be more strict? Or that society will never stop being violent and we will always have people not respecting regulations.
4. Following the last question I will like to picture this....How will market economy be if anyone will ever make a crime or break PPR?

C)
I believe Rizzo gave us his overview about Private Property Rights so we can realize how important their role are in a market economy. How PPR are what make our society trade intelifently and allocate resources from people than have low interet on them to people that have great interest on them. PPR is what make us not just beat us up when we want to use this resource.

Class #21 "Production Possibilities Frontier" (10/21/2011)

The key of success of trade is just re-locating goods efficiently. 

Trade Example

--Mike and Rizzo have the same yard and drive way.

• Before
• Mike
• 80 minutes to weed
• 40 minutes to mow
• TOTAL: 120 minutes
• Rich
• 120 minutes to weed
• 120 minutes to mow
• TOTAL: 240 minutes

Offer: Rich weed 3/4 of Mike's drive if Mike mows his yayd. 

• After
• Mike
• 20 minutes to weed (1/4 of 80)
• 80 minutes to mow. (Both lawns)
• TOTAL: 100 minutes
• Rich
• 210 minutes to weed (His property+90 minutes of Mike's)
• 0 minutes 
• TOTAL: 210 minutes
• Trade EFFECTIVE: Both benefit. 

Production Possibilities Frontier (PPF)/ Production Possibilities Curve (PPC)

-All points on the line are possible

-All points outside the line are not

-Absolute advantage

-All points on PPC= "Productively Efficient"

-Slope must take trade offs between goods

-Law of Diminished Return

-Economic Growth: More resources, technology and trade. 

-Rizzo

Daniel Gaona

EWOT Goggles #7 "Does The Rule of Law really exists?" (10/23/2011)

"Rule of Law"
The Rule of Law requeres two things in order to exists:
-Rules are not arbitrary
-No special treatment is given to certain members of a population.

What is happening this weekend? Meliora Weekend!
             The most important event of this weekend, (important is based upon the amount of interest given by people) was Bill Clinton's speech. University of Rochester has tickets for this event and puts them on sale to a population, which includes parents, students, alumni and faculty. For the Rule of Law to be successful the entire population has to be treated the same way. However, this was broken since the alumni had preference over the actual students and had more access to the tickets than we had. Few students had the ability to find tickets besides the one that went since their parents bought tickets. I believe the entire population eligible to buy tickets should have been treated the same way.

         Another example that I could mention was something that happen in ASU, where one of my best friends go. After a football game some players got really dunked and were disturbing people inside campus with parties. When security came and took their names people thought they were getting in trouble. However, last week after their meeting with the dean it appears that nothing happen since their coach help them. Now one month ago my friend threw a party in his dorm and got his name written by security. After his meeting with the dean, he had his suite on probation.

What does this mean? Some students are treated differently than others. No!
For me this means that the  "Rule of Law" exists in very limited places if not in any....

Lecture #20 "Trade and Exchange" (10/19/2011)

Ethics in Economics.... 

Feedback loops: Can be considered as a channel or a pathway formed by an 'effect' returning to its 'cause'.
What allow people to have faith in the system.
Ex. How can I trust a business to do something for me like deliver a package if I don't know anybody in the company or in the process.

• Active loops is what makes many parts of our life great.
• Inactive loops are in our frustrating pieces of life like school tuition or healthcare insurance. 

Trade and Exchange

Core Economic Questions (3):

1. What goods to produce?
2. How to produce those goods?
3. How to deliver those goods to the producers?

Inputs----->Black Box----->Stuff


Inputs are called the "Factors of Production"

• Land (Natural Resources)
• Labor
• Capital (What is produces with the objective of then producing more)
• Human Capital (machines, any machinery)
• Physical Capital (any improved quality to make stuff)

Ways of achieving this process:

• Become self sufficient
• Specialization and Exchange 
• Discovering

-Rizzo

Daniel Gaona

Lecture #19 "Ethics/Society Rules " (10/17/2011)

During this lecture Rizzo argued and talked about Ethics and moral beliefs in a market. Talking about the rules that make market and society more effective.


Ethics
       People argue that society could successfully live a happy life with the Golden Rule since people will then treat everybody how they want to be treated. However, Rizzo argue that the Golden Rule works with people you know but not with strangers. Furthermore, people requires an substitute rule that could be used when treating with strangers.

        Rizzo argue how if people operate according to a belief of "I'm going to to what I think you want" could be dangerous. For example, Rizzo is late to the bus stop and starts chasing the bus, Then the bus driver sees Rizzo and decides to stop and wait for him. Now in this scenario the bus driver who waits is not virtuous but arrogant since he is violating the Rule of Law.

• Now in a commercial society, normally the rule or mantra is "I'll do this for you, if and only if you do something for me. What is the motivations in a market economy: self interest. 

Silver Rule
Do not do unto others what you consider unfair or unjust if they did it to you. This rule is used for transactons among strangers.

Moral points for Economics

• It's acceptable if  it's with your own money, but it's not acceptable with someone else's money.
• If you run a business like a family your going to destroy the business; if you run a family like a business you are going to destroy the family. 
• Running a profitable business requires using soft values, The best businesses treat their employees and consumers well.

-Rizzo

Daniel Gaona