Quotes About Economics

What most of these doomsday scenarios have gotten wrong is the fundamental idea of economics: people respond to incentives. If the price of a good goes up, people demand less of it, the companies that make it figure out how to make more of it, and everyone tries to figure out how to produce substitutes for it.

declared preferences and revealed preferences.)

The way economists see it, the chances of an individual's vote influencing an election outcome is vanishingly small, so unless it is fun to vote, it doesn't make much sense to do so.

If morality represents how people would like the world to work, then economics shows how it actually does work.

MODERATOR: Tonight, our guest: Thomas Sargent, Nobel laureate in economics and one of the most-cited economists in the world. Professor Sargent, can you tell me what CD rates will be in two years? SARGENT: No.

Engañar es un acto económico primitivo: obtener más a cambio de menos.

That is the idea behind a prize-linked savings (PLS) account.

when there are a lot of people willing and able to do a job, that job generally doesn't pay well. This is one of four meaningful factors that determine a wage. The others are the specialized skills a job requires, the unpleasantness of a job, and the demand for services that the job fulfills.

How can this type of data be made to tell a reliable story? By subjecting it to the economist's favorite trick: regression analysis. No, regression analysis is not some forgotten form of psychiatric treatment. It is a powerful—if limited—tool that uses statistical techniques to identify otherwise elusive correlations.

Incentivize them on the dimensions that are valuable to them but cheap for you to provide.

Why has the prostitute's wage fallen so far? Because

there is one mantra a Freak lives by, it is this: people respond to incentives. As utterly obvious as this point may seem, we are amazed at how frequently people forget it, and how often it leads to their undoing. Understanding the incentives of all the players in a given scenario is a fundamental step in solving any problem.

But if you want to think like a Freak, you must learn to be a master of incentives—the good, the bad, and the ugly.

Selling is a painful necessity, buying is what makes it all worthwhile.

Economics] is all about observing the world with genuine curiosity and admitting that it is full of mysteries

Most of economics can be summarized in four words: "People respond to incentives." The rest is commentary.

If you support protectionism because you think it's good for you, you've probably just got your economics wrong. But if you support protectionism because you think it's good for your fellow Americans, at the expense of foreigners, then it seems to me you've got your morals wrong too.

The chief merit of the price system is that it makes effective use of information that is not available to any single decision maker. When the price system is overridden, information is discarded. When information is discarded, resources are misallocated. When resources are misallocated, prosperity suffers. If you're trying to make people prosperous, relying on prices is your best strategy.

Freakonomics is out to dazzle you with facts; The Armchair Economist is out to dazzle you with logic.

The governing principle is precisely the same one that predicts behavior at the gas pump. When the price of gasoline is low, people choose to buy more gasoline. When the price of accidents (e.g., the probability of being killed or the expected medical bill) is low, people choose to have more accidents. You

Among college students, economics and philosophy majors have similar current incomes, but it's the economics students who drive cars, because it's the economics students who expect to have jobs someday.

Capitalism set out as the opponent of privilege and the champion of freedom," Rauschenbusch wrote, "it has ended by being the defender of privilege and the intrenchment of autocracy.

If you worked for an hour at the average wage of 1800, you could buy yourself ten minutes of artificial light. With kerosene in 1880, the same hour of work would give you three hours of reading at night. Today, you can buy three hundred days of artificial light with an hour of wages. Something extraordinary obviously happened between the days of tallow candles or kerosene lamps and today's illuminated wonderland. That something was the electric lightbulb.

regulatory impact analysis