Sunday, January 13, 2013
Which of the five items to the left infer Pareto efficiency? Wikipedia partially define Pareto efficiency as: "In a Pareto efficient economic allocation, no one can be made better off without making at least one individual worse off.
My answers: 1, 2 and 3.
In truth five, the author of this piece, brings up the free rider problem--Why should I work when I get all of the benefits and none of the costs.
In truth four, this is a statistical joke. If you take a piece of pie and divide it 8 times, it's still one pie.
The real questions behind the truths include fairness in the distribution of income, taxes, incentives to produce, and the role of the government. I know that two children born to different parents don't start at the same line. I also don't like the idea of taxing the wealthy and giving to the poor simply be they are poor. I also believe that social change is inevitable when there's wealth inequality.
The questions along with the answers are deep. There's not a singular right answer. But workers who produce and contribute to society, should somehow be rewarded no matter what their job is.