Bài giảng Economics of Social Issues - Chapter 1 Alleviating Human Misery: The Role of Economic Reasoning

Chapter 1Alleviating Human Misery: The Role of Economic ReasoningCopyright © 2010 by the McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/IrwinGoods & ServicesFood, Clothing, Shelter, TransportationHealth Care, EducationTruth, Justice, and the American Way1-2ResourcesLaborCapitalTechnology1-3ScarcityScarcityEconomic ProblemOur InsatiableWantsOur LimitedMeans1-4The Capacity of the Economy to ProduceGross Domestic Producttotal market value of all final goods andservices produced within an economy during a specific time period1-5Production PossibilitiesFoodEducation010040865080607290401000202040405060908086100Education (millions of student years)Food (millions of tons)72ADCC’EFZ100B1-6General and Specific Economic Growth100100Education (millions of student years)Food (millions of tons)1-7The Opportunity Cost PrincipleThere is no such thing as a free lunchIncreasing opportunity costThe Optimal Combination of Goods and ServicesMarginal Social Cost (MSC)Marginal Social Benefit (MSB)Cost-Benefit Analysis20204040506090728086100100Education (millions of student years)Food (millions of tons)ABDCC’EFZ1-8Adjusting GDP for InflationYearProduction of Bread (Loaves)Price of BreadGDP in Current Dollars(1)x(2)Price IndexPercentage and Decimal FormsReal GDP (2009 Dollars)(3)/(4)20091,000$1.00$1,000($1/$1) x 100 = 100, or 1.00$1,00020101,0002.002,000($2/$1) x 100 = 200, or 2.00$1,000Two good example1-9Adjusting GDP for PopulationYearGDP, Current Dollars (Billions)Price IndexGDP, Real 2000 dollars (Billions)Population (Millions)GDP, Real per Capita (2000 Dollars)19802,789.554.0435161.6227.722665.9719813,128.459.1195291.7230.023010.7919823,255.062.7265189.2232.222349.2819833,536.765.2075423.8234.323148.2819843,933.267.6555813.6236.324597.6819854,220.369.7136053.8238.525386.5119864,462.871.2506263.6240.726027.6519874,739.573.1966475.1242.826667.9319885,103.875.6946742.7245.027518.761989 5,484.478.5566981.5247.328226.171990 5,803.181.5907112.5250.128435.041991 5,995.984.4447100.4253.528010.421992 6,337.786.3857336.6256.928558.7619936,657.488.3817532.6260.328943.2119947,072.290.2597835.5263.429743.2819957,397.792.1068031.7266.630131.3619967,816.993.8528329.0269.730886.1119978,304.395.4148703.4272.931891.0119988,747.096.4729066.9276.132837.3319999,268.497.8689470.3279.333907.9020009,817.0100.0009817.0282.434762.38200110,128.0102.3999890.7285.334663.54200210,469.6104.18710048.9288.234865.71200310,960.8106.40410301.1291.135388.202004 11,685.4109.4610,675.8293.936,299.892005 12,421.9113.3410,959.9296.636,913.10200613,178.4116.6711,298.4299.837,674.45200713,807.5119.8211,523.5301.638,207.89200814,264.6122.4611,648.4304.538,224.19Recession1-10CountryPopulation Estimate 2006 (Millions)Annual Rate of Population IncreasePopulation Density per Square Kilometer (2006)Per Capita Real GDP (2006)Percentage Annual Growth Rate of Real GDP (2006)Life Expectancy at Birth, Latest Available DatesLesser-developed      Chile160.8225,9124.378China1,3110.61401,61011.671Columbia461.4452,3176.873Egypt741.8751,6156.871El Salvador71.43262,2624.272Ethiopia772.67716110.952India1,1091.43736379.764Indonesia2231.11239835.568Kenya372.6644396.153Mexico1041.1546,3894.874Nigeria1442.41594546.247Peru281.1222,5527.671Philippines862.02891,1545.471South Africa471.0393,5625.051Thailand630.21242,6055.170Venezuela271.7315,42610.374Zambia121.9163216.242Average 1.5  6.665Developed      Canada321.03.625,8942.880France610.811123,9922.081Germany82-0.123624,4742.879Italy590.620019,6301.981Japan1280.635038,8242.282Singapore43.16,38828,8339.480Sweden90.62231,1894.281Switzerland70.618735,7943.282United Kingdom610.625027,6112.879United States2991.03337,6742.978Average 0.08   3.4801-11Adjusting GDP for DistributionCountry (Year of Study)Poorest 20 PercentSecond 20 PercentThird 20 PercentFourth 20 PercentRichest 20 PercentLesser-developed     Chile (2003)3.8%7.3%11.1%17.8%60.0%China (2004)4.28.513.721.751.9Columbia (2004)2.96.911.018.360.9Egypt (2004)8.912..716.020.841.5El Salvador (2002)2.77.512.821.255.9Ethiopia (2000)9.113.216.821.539.4India (2004)8.111.314.920.445.3Indonesia (2005)7.110.714.120.542.5Kenya (1997)6.09.814.320.849.1Mexico (2004)4.38.312.619.755.3Nigeria (2003)5.09.614.521.749.2Peru (2002)3.77.712.219.756.7Philippines (2003)5.49.113.621.350.6South Africa (2000)3.56.310.018.062.2Thailand (2002)6.39.714.020.849.0Zambia (2004)3.67.912.620.855.1Average5.39.213.420.351.8Developed     Canada (2000)7.212.717.22339.9France (1995)7.212.617.222.840.2Germany (2000)8.513.717.92336.8Italy (2000)6.51216.722.842.0Japan (1993)10.614.217.62235.7Singapore (1998)5.09.414.622.049.0Sweden (2000)9.21417.622.736.6Switzerland (2000)7.612.216.322.641.3United Kingdom (1999)6.111.416.022.544.0United States (2000)5.410.715.722.445.8Average7.312.316.722.541.11-12Adjusting GDP for DistributionAnnual IncomeFamily AAnnual IncomeFamily BAnnual IncomeFamily CAnnual IncomeFamily DAnnual IncomeFamily EAnnual Incomeof all FamiliesAverage AnnualFamily IncomeAlpha$2,000$2,000$2,000$2,000$2,000$10,000$2,000Omega000010,00010,0002,0001-13Causes of Poverty and Requisites of Economic GrowthQuality of the Labor ForceStock of Capital and Capital AccumulationTechnologyEfficiencyPopulation1-14Can Governments Help?Governments of LDCsPrivate property rightsUniversal educationCapital accumulation processSocial infrastructurePopulation controlGovernments of DCsLoans and grantsTechnical assistanceWorld Bank1-15Computing Current-dollar GDP YearBreadFruit PunchCurrent-dollarGDPPbQbPbQbPfQfPfQf2009$1.00100$100$2.0075$150$250(Pb * Qb) + (Pf * Qf) = Current-dollar GDP1-16Adjusting GDP for Inflation YearBreadFruit PunchCurrent-dollarGDPPbQbPbQbPfQfPfQf2009$1.00100$100$2.0075$150$2502010$1.50200$300$4.00150$600$9001-17YearPbQbPbQbPfQfPfQfReal GDP2009$1.00100$100$2.0075$150$2502010$1.00200$200$2.00150$300$600Adjusting GDP for InflationBaseYear YearBreadFruit PunchCurrent-dollarGDPPbQbPbQbPfQfPfQf2009$1.00100$100$2.0075$150$2502010$1.50200$300$4.00150$600$9001-18GDP DeflatorGDP Deflatort = Current-dollar GDPt * 100 Real GDPt1-19Converting Current-dollar GDP to Real GDPReal GDPt = Current-dollar GDPt * 100 GDP Deflatort 1-20