Κεφάλαιο 5: Οικονομική Αποτελεσματικότητα και Δικαιοσύνη

Chapter 5: Bade & Parkin - Economic Efficiency and Justice in Product Markets

• Resource Scarcity and Allocation: Insufficient production resources necessitate allocation among alternative uses.
• Market Efficiency: Markets ability to equitably and effectively allocate resources for societal benefit.
• Methods of Resource Allocation: Markets can allocate resources using various methods, including price systems, command allocation, majority rule, auctions, first-come, first-served, and consideration of personal attributes.

5.1 Methods of Resource Allocation and Economic Efficiency

• Methods of Resource Allocation: Resources can be allocated using market prices, orders, majority rule, auctions, first-come, first-served, individual characteristics, or power dynamics.
• Economic Efficiency: Optimal resource allocation maximizes the value derived from scarce resources.

Efficiency in Resource Use

• Optimal Resource Use: Economic efficiency occurs when goods and services are produced at the quantities valued most highly by consumers. It is impossible to increase the production of one good or service without sacrificing the production of another valued more highly.
• Production Possibility Frontier (PPF): The PPF represents the maximum combination of goods/services that can be produced given available resources and technology.

Marginal Benefit

• Marginal Benefit (MB): The benefit gained from consuming an additional unit of a good/service.
• Diminishing Marginal Benefit: The additional benefit of consuming one more unit of a good/service typically decreases as you consume more of it.

Marginal Cost

• Marginal Cost (MC): The cost of producing one more unit of a good or service – measured by the opportunity cost of the inputs required.
• Increasing Marginal Cost: The additional cost of producing more of a good or service typically increases as more units are produced.

Efficient Allocation

• Efficient Allocation: occurs when the marginal benefit of producing/consuming an additional unit equals the marginal cost.
• Visualizing Efficiency: An efficiency graph displays this equality as a point of intersection between marginal benefit and marginal cost curves.

5.2 Value, Price and Consumer Surplus

• Value (to the consumer): The benefit or utility a consumer derives from purchasing a good or service.
• Price (to the consumer): The amount the consumer pays to buy a good or service.
• Demand Curve (and Consumer Surplus): The demand curve represents the relationship between the price and quantity demanded. Consumer surplus is the difference between the buyer’s willingness to pay for a good or service and the price they actually pay. The consumer surplus graph is shaped like a triangle on a market graph..

5.3 Cost, Price and Producer Surplus

• Cost (to the producer): The resources (raw materials, labor, etc.) used to produce goods or services.
• Price (to the producer): The amount the producer receives for selling goods or services.
• Supply Curve (and Producer Surplus): The supply curve shows how much quantity of a good will be supplied at each possible price. Producer surplus is the difference between the price paid by buyers and the minimum price at which sellers would be willing to sell their product. The producer surplus graph is shaped like a triangle on a market graph.

5.4 Is the Market Efficient?

• Market Equilibrium: The intersection of supply and demand curves where the quantity demanded equals the quantity supplied—where the market is stable and the marginal benefit from consuming an additional good equals the marginal cost of producing it.
• Efficiency and Market Equilibrium: Market equilibrium generally leads to an efficient allocation of resources, where the sum of consumer and producer surplus is maximized.

5.5 Inefficiency Due to Resource Misallocation

• Inefficiency: Occurs when resource allocation does not maximize total economic benefit.
• Sources of Inefficiency: Includes situations such as insufficient production, overproduction of goods or services, misallocation of resources, market failures.

5.6 Inefficient Allocation Options and Alternatives to Markets

• Policy Options: Interventions in markets, such as price ceilings, price floors, taxes and subsidies, may alter market outcomes and lead to inefficiencies.