1) Read "Why Do Drug Dealers Still Live with Their Moms?" from Freakonomics.
2) Find another credible source on the internet that connects to the reading above or to terms or concepts from this past week's classes.
3) After you read the source that you find, answer the following questions as a blog entry below:
- How does the text connect to that week’s topic or to the other text you have read? (relevant)
- What evidence do you have that the text you found is credible? (credible)
- Create a clear, specific argument based on the text. (argument)
- Support the argument with thoughtful analysis, using cause/effect, compare/contrast, problem/solution, part/whole, or other methods of analysis.
Keep in mind that everyone else will see what you write below, so please keep it professional. This post is due Thursday, 2/7, by 12:00am.
4) Come to class on Friday ready to discuss the reading and the text you found!
If you need support or have questions, my office hours are Monday and Wednesday from 3:15-4:15 in Room 229.
Dan Noyes, in “How Criminals Get Guns”, clearly demonstrates how guns have become part of a larger black market closely related to gang activity. In "Why Do Drug Dealers Still Live with Their Moms?" from “Freakonomics”, Levitt shows that gang activity creates a market within itself; entrepreneurship, laborers, and consumers all being of part. Guns contribute to this market because when demand for protection and fire arms increase, guns serve as a complimentary good for gang members.
ReplyDeleteThis source is credible because it was taken from PBS.org. PBS.org is well known and serves as a news broadcast. Using any misleading information could harm this organization and potentially lower their numbers in audience. The author of the article, Dan Noyes, is the chief investigate for ABC news, another well known news broad caster. He has had more than a decade of experience in this field, making him a very credible source. Also, in this article, he uses statistics and quotations obtained from ATF agents clearly showing that Noyes researched the topic thoroughly. The credibility of this article is that of high quality.
For the gang mentioned in “Freakonomics”, their foot soldiers are their laborers. These soldiers are often on the streets selling cocaine. Being a foot soldier means you are putting your life at a higher risk than other workers under different “job descriptions”. This is because anyone is able to be a foot soldier; there isn’t a specific skillset for it. But, as gang activity increases, the need for foot soldiers to protect themselves also increases. One of the foot soldier states, “So if I gonna be asked to put my life on the line, then front me cash, man. Pay me more ‘cause it ain’t worth my time to be here when they’re warring.” The same way foot soldiers demand a higher wage during times of mayhem, members of gangs in general also demand protection. Levitt states that “Drive-by shootings became a daily event”. This is where the complimentary good of fire arms comes in. As dangerous activity increases, there is an increase for the need of protection. This sets up a black market for gangs as they try to obtain fire arms. A gang cannot simply be a gang without the protection of their fire arms. Noyes states, “[a] large source of guns used in crimes are [by] unlicensed street dealers”. In the world of foot soldiers, or the laborers of the gang, “violence served a purpose”. Being part of a shooting and killing others serves to distinguish foot soldiers. Noyes states that these gang members often want guns and “they want them immediately”. Being a gang member and owning fire arms simply go hand in hand. Gang wars happen whether one wants them to or not, and sadly, that increases the demand for fire arms; bringing an end to the lives of many other gang members.
In order to meet the increases in demand, where consumers are willing and able to buy a product, a sufficient amount of supply should be available to satisfy these needs. But because of finite or limited resources, it is inevitable that demands will not be fully met. Patrick McGeehan’s article, “Demand for Electricians Soars After Hurricane”, provides a clear example of how supply and demand directly affected one another in New York City after low-lying areas had been hit hard by Hurricane Sandy, facing flooding and a loss of electricity. These areas require the help of electricians, but the dilemma the individuals in these areas face is that there is a finite number of electricians that are readily available to go to these areas. “Why Do Drug Dealers Still Live with Their Moms?” from “Freakonomics” by Steven Levitt and Stephen Dubner explains that some people usually don’t get a job that requires too many skills or demands unless they have those skills, ultimately turning to a job that requires less work and will still allow them to make a profit. An electrician’s job requires said skills, therefore there aren’t many of them readily available.
ReplyDeleteThe New York Times, founded in 1851, is a highly known and trusted news organization. Delivering national and international news through its newspaper and its website to more than 30 million readers, the New York Times is considered to be one of the most predominant news sources for Americans. Patrick McGeehan has been a reporter for the Wall Street Journal and USA Today, providing his readers with the latest news in financial markets. As a graduate from Columbia University’s business school, McGeehan earned his M.B.A. In finance, demonstrating that he has a lot of knowledge on economics.
McGeehan’s article provides us with the problems that can turn up as a result of high demand and low supply. The demand that had risen after Hurricane Sandy caused a frenzy among electricians, since the city faces having a low number of electricians who would be able to repair low-land areas. This connects to the fact that “a lot of people are competing for very few prizes...people [are more] willing and able to do a job, that...generally doesn’t pay well” (Freakonomics) because it explains why there is such a low number of electricians; people, especially unskilled workers, are more willing to work for the job that requires less skill in order to make a living. According to Ryan Walsh, the vice president of Walsh Electrical, “a team of eight or nine electricians [were] going house to house in some neighborhoods, but that he could deploy twice as many if parts were more plentiful. [Electricians were] stopping at every Home Depot and Lowe’s they saw and buying whatever they could…”, illustrating how difficult it has become to meet the demand and the peoples’ needs, especially when there aren’t enough people with the skills to perform the job of a licensed electrician. This situation also shows how electricians have to compete to keep up with the demand, as Walsh states, “People are just begging [electricians] to get [to their homes]. But I bet they’re begging 10 electricians to get there. And whoever gets the material first gets the job.” Electricians also face a shortage of the equipment that they need in order to do their job correctly. Suppliers had to find new ways to handle the shortages, one example being through “...rationing panel boxes and circuit breakers. Most [suppliers] were limiting purchases to five panel boxes and the number of the circuit breakers each one held.” Rationing allows electricians to help individuals in need while still having enough supplies left over. However, electricians should have taken better precautions when it came to this situation by stocking up on materials prior to Hurricane Sandy’s landfall, thus preventing shortages.
Chapter 3 of Freakonomics present us with the common misconception that all drug dealers make a lot of money when in fact, that is only true for a very small percentage of the drug industry. In fact, only the bosses at the top of the industry, who are in charge of the other dealers, are the ones who have a large income. The article, “Supply, Demand, and Executive Pay” also mentions that the heads of companies end up having a higher income than their workers. Both texts show that the higher up you are in an industry, the more you get paid compared to those who are below you.
ReplyDeleteThe article I found comes from the “Economix” section of the New York Times. The NY Times is one of the most well-known news organizations in the world. This organization publishes news nationally and internationally everyday through a variety of forms, such as newspapers, online articles, and magazines. Because The Times is read so frequently by such a large audience, publishers will make sure not to give out any false information in order to prevent from damaging their reputation as a reliable news source. The author of the article, Uwe Reinheardt, is also reliable because he is an economics professor at Princeton University, proving that he has spent a lot of time studying economics. Thus, it is expected that he is extremely knowledgeable on this topic considering that he is able to teach it at such a prestigious university.
Based on the two texts, it is economically just to give higher wages to workers that are higher up in any industry. First of all, if you have a higher position in an industry, that already means that you have met certain qualifications for that job that not all workers can meet, otherwise, any other worker could have gotten a higher position in the company. The author of Freakonomics states that “a lot of people are competing for very few prizes.” Many drug dealers may compete to be the boss and many workers may compete to become CEO, but not all of them have the skills set to actually do this. Since “the supply of talented executives is strictly limited” (Reinheardt), the demand for them is higher and employers will pay them much more than just another worker that is more easily replaceable. Nonetheless, whether it’s a drug lord or a CEO, it is economically just for them to receive higher wages since there is a higher demand for a smaller supply of people who are willing and able to run industries.
http://www.cbsnews.com/8301-505124_162-43440297/price-elasticity-smacks-sony-blu-ray-playstation/
ReplyDeleteThe article “Price Elasticity Smacks Sony, Blu-Ray, Playstation” by Erik Sherman, directly relates to our discussion of price elasticity, where demand depends on price, in class. Sony is creating new products, such as Blu-Ray, and releasing them to the public. However, despite the brand new technology with new features, the demand for Sony’s new products are not as high as one would expect. The price Sony sets for their products are too high, therefore, not many are willing to purchase the new items.
Erik Sherman, the author, is a widely published writer and editor for CBS News. Because Sherman is widely published, he would not publish false information since that would ruin his reputation. A ruined reputation would be awful for his position since many would stop reading his writing and that could cause him to lose his job. Additionally, CBS News is a well known news division of American television and radio network CBS. CBS News would not dare to endanger its credibility since that would be bad for their ratings thus their viewers would decrease. A news channels needs viewers in order to survive. As a result, this article is credible because both the reputation of Sherman and CBS News is at play.
Sony releases new products like Blu-Ray with high demand, or how many consumers are willing and able to buy, in mind. One would think that because new products came out, the demand would immediately rise since many want the next best thing. However, that is not the case here. As Sherman states, “In the consumer electronic space, it's hard enough to get people to pay a premium when times seem good. And yet Sony, whether competing against no one in high definition movies or against Microsoft and Nintendo in the game console market, seems to insist on ignoring price elasticity.” Sony keeps setting high prices for their new products which, if purchased, would require people to buy more equipment or change the way they use such device. For instance, “Blu-ray equipment cost far more than that for HD DVD, and once again people are essentially being asked to repurchase entertainment they've previously bought” (Sherman). Consumers are not willing to adopt to change the new products require, which keeps prices up and keeps pushing consumers away. As a result, Sony isn’t making much of a profit since they keep producing expensive products and maintaining prices high while demand is much lower. In fact, demand for older products such a DVD players is higher versus Blu-Ray because many have had DVD’s for much longer. Additionally, most do not want to get rid of their DVD’s, especially when it is cheaper to have DVD’s instead of Blu-Ray. In essence, despite high supply, those willing and able to make products, the demand for Sony’s fancy new products aren’t desired by its consumers.
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ReplyDeleteThe article, “Earnings in United States Are Beginning to Feel a Pinch,” discusses how businesses are walking on a tightrope because the demand of their products have declined, unable for the companies to gain profit. This article is relevant to the this week’s readings because major companies, such as FedEx and Intel, even Burberry, “are warning of lower quarterly profits because of weakness in worldwide demand,” according to the article. An example of the economic market in action; when demand is low, companies receive less profit from consumers, similar to the drug world in Chapter 3 of Freakonomics. When there is a turf war between drug gangs, the demand decreases because consumers are afraid to get involved, therefore drug gangs have no choice but to decrease the prices of their drugs, which might lead to a decrease in the company's profit.
ReplyDelete“Earnings in United States Are Beginning to Feel a Pinch” is from the New York Times. It’s apparent that the New York Times provides reliable information since 1851. The newspaper has won over 100 Pulitzer awards, more than any other news organization, and with 30 million visitors every month, the Times have a strong reputation to protect, an incentive to provide reliable news information. Nelson D. Schwartz, the author of the article, has covered banking, finance and Wall Street stories for the business section of The New York Times for years as a specialized economist, he is also a former senior writer for Fortune.
It is reasonably fair to decrease the prices of low-demand products. If companies want more revenue, then they are going to need a method to increase the number of consumers willing and able to buy, or demand, and decreasing prices is the best way to draw in consumers to set their profit back on track. Similar to J.T., the gang leader in Why Do Drug Dealers Still Live with Their Moms?, he was required to drop the prices of his drugs after his gang was experiencing a turf war. Their consumers do not want to be part of their war, they do not want to risk their lives to go outside and buy some drugs when they can in a second get shot, they are not willing to do so. So to get their consumers out and increase demand, they decrease the prices of their drugs. Not only will the decrease in demand hurt the company’s revenue, but it will also hurt the company’s labor. If companies are not producing something that people want, then the demand in the job market of the company will decrease. The wages might also decrease. So to decrease the prizes of a company’s low-demand products is an acceptable idea. Although decreasing prizes might not fix the demand issue, or even decrease revenue and profit even more if demand remains low, it is the best way to protect profit and prevent company down closure.
In “VENTURA: 3 Men Sentenced for Selling Crack” Mack Reed writes about how three men were all arrested for selling crack cocaine and how their act is problematic because they also work together towards maintaining a house where crack is sold and illicit narcotic sales are controlled. On the other hand, in “Freakonomics” Levitt emphasizes that crack dealing is the most dangerous yet respected job in America because of the violence behind it. People become involved in this market because they believe that even though they’re not wealthy, the more of a loyal customer they are, the more successful they are in selling this illegal product to create a profit, and the faster they’ll have a high fortune in the end. Evidently, both Reed and Levitt would agree that crack cocaine creates a market through the people that transport the drugs from one place to another, set a price for it, and then store it to provide it to those who are willing and able to pay enough for such an addicting yet health threatening product.
ReplyDelete“VENTURA: 3 Men Sentenced for Selling Crack” is credible for multiple reasons. First of all, this article comes from Los Angeles Times, a daily newspaper that informs America about multiple issues since 1881. In addition, Mack Reed, the writer of the article I found is a staff writer for the Los Angeles Times which means that he has good writing skills since not everyone is able to work for this company. This article is also credible because not only is Mr. Reed a staff writer but he is also a specialist in finding cases that have to do with illegal businesses and robberies as stated in the crime column of the Los Angeles Times site.
Based on “Freakonomics” and the article I found, they are both similar in that cocaine is the product that drives a market in a way where the greater majority involved will be satisfied. In “Freakonomics” cocaine is dealt with in the market as there is a high supply of it so more people are willing and able to buy it. However, the people who do buy it are only successful if they are not caught reselling the drug left over that seems useless while the rest has been consumed. Clearly, this is important because there is a finite amount of cocaine and an infinite amount of dealers who view this market as the core of their life. On the contrary, although Levitt wrote that “There was no such thing as a thirty-year-old gangster” Reed would disagree. Based on the article, it is similar to Levitt although out of the three men who were put into jail for selling crack, only 2 were younger than 30 and the other was 38. Reed clarifies that age is not a factor that interrupts this market. Instead he argues that the only factor that may disrupt this market are people who do not understand where to keep the drug and who are caught in the act of distributing to the consumer because they get easily caught. The people who have the drug as a possession also suffer because although they receive mental health, if they have been part of the military they must become bound to serve time in a federal facility rather than a state facility. Overall, the narcotic market is one of the most successful today but not everyone is capable of handling the vileness that is hidden behind the richess.
The article “Saturday Mail Near End” by Jennifer Levitz and Eric Morath, elaborates on the U.S Postal Office announcement that it would end Saturday mail delivery starting August 5. The Post office has recently lost $ 15.9 billion in the recent fiscal year, therefore it goes with will cut Saturday service for letters to “achieve $2 billion in annual savings” (Morath). This is an example of the market because with the new technologies; emails and instant messaging, there is a lower demand of the postal services. For example only 10 years ago there were “50 billion pieces of stamped mail, while in 2013 that number is expected to be 21 billion pieces” that more than half percent decrease in only a short period of time. The post office is becoming more elastic in recent years and being substituted with emails and instant messaging devices. Especially since computers and cellphones that have email capabilities are becoming a greater part of our everyday lives, the use of the post office to get messages is becoming less and less. This article was published by the Wall Street Journal that a well known newspaper organization, specialized in finances that has a good reputation. It would jeopardize the newspapers customer's, name and credibility if it published wrong information, that is about the governmental postal system. Since, there is a lower demand for the postal services, it is only just that the Postal office decrease it supply of services to deal with the changes. For example the Postmaster General states“‘It's a reasonable business action and common sense; when revenue drops you have to make changes’” (Morath) The Postmaster’s point deals with the change in demand, there should be a change in supply to meet at the new equilibrium price so that the post office can make more revenue. The Postal Office witness the effects of modernization, forcing them to change things to fit the new demands for shipping large packages and less for letters.
ReplyDeleteThis week’s reading, “Why Do Drug Dealers Still Live with Their Moms?” from Freakonomics explains the different tiers of drug dealers and how much they get paid according to a Chicago gang, the “Black Gangster Disciple Nation”. This gang consisted of different levels such as the leaders, board of directors, foot soldiers and the rank and file. The incentives of all these drug dealers was to become a leader. Similarly, “In Detroit, Two Wage Levels Are the New Way of Work” Bill Vlasic states how the jobs at Chrysler are classified as two-tier jobs because some earn more than others. An abundant amount of employees get paid $14 an hour, but have hope that they get promoted to become a team leader in the plant because those leaders earn an additional amount.
ReplyDeleteThe text I found is credible because it’s published by the New York Times, a very prestigious partisan news company that was established in 1851. This news company has millions of American followers and if they post false information, their reputation will suffer. The author of this article, Bill Vlasic, has been a reporter for more than three decades and is the Detroit bureau chief of the New York Times. Moreover, Vlasic is a winner of the Gerald Loeb Award for excellence in financial journalism and was the co-author of a book that was named as one of the 75- all time best business books by Fortune magazine.
When you are categorize in the bottom at any job, you should always have the incentive to be promoted as one of the top leaders some day. In “Why Do Drug Dealers Still Live with Their Moms?” it states, “J.T., might have had anywhere from twenty-five to seventy-five foot soldiers on his payroll at any given time... And the foot soldiers earned just $3.30 an hour, less than minimum wage...”. Here, J.T. and the foot soldiers found an equilibrium with the wage rate. Since there was so many of them, J.T. had to pay them a low wage rate but the suppliers were willing and able to work at this specific wage rate while the demand J.T. was willing and able to hire at this specific wage rate even though he could’ve “Easily afford to pay his foot soldiers more, but it wouldn’t be prudent”. All these lower gang members in the drug “game” had the incentive to be a leader one day because they saw that J.T. had a monthly salary of $8,500. J.T. earned so much because he was one of the few leaders. This means the fewer supply there is in that position and with a specialized skill set, the more you will get paid. In comparison to my source, there was many workers on the lower tier. Vlasic states, “About 12- percent of Chrysler’s 23,000 union workers earn the lower wage”. Seeing that there was so many employees, Chrysler’s employers were only willing and able to hire at $14 an hour because the new hires being paid at this wage helped closed the cost gap with foreign carmakers. Many of these employees have the incentive to obtain more power at their job because it comes with many benefits. For instance, lower-tier workers get the traditional medical benefits, a maximum of four weeks paid time off a year and they have to build their own personal retirement plan. In comparison to the higher tier workers, they get five weeks paid time off a year and a guaranteed $3,100 per month pension after age 60. The demand are willing and able to pay their time off and give this monthly pension to higher-tier workers because there’s very few of them and they have specialized skills that contributes to the success of the company.
In the article “Has Apple Lost Its Cool to Samsung?” fundamental aspects of a market economy are portrayed. Samsung has been able to decrease the gap between Apple thanks in part to its latest products like the Samsung Galaxy III. This article relates to this week’s topic of a market economy because price elasticity is evident in the smartphone market. With competition in industries there are more substitutes available. More substitutes available affects the price and demand responds to changes in price. Price elasticity and substitutes are ever so present in the smartphone market with the competition between Samsung and Apple.
ReplyDeleteThe article “Has Apple Lost Its Cool to Samsung?” is a credible source because it was published in The Wall Street Journal. Not only was it publicated by a prestigious news informant, but it was published by an informant that specializes on business and other financial related matters. Any obstruction or misinformation will cause this enterprise to lose credibility, readers, and profit. Moreover, this article was written by Ian Sheer and Evan Ramstad. Ian Sheer is an award winning internationally published journalist with vast experience; he has worked as a reporter for Dow Jones Newswires and The Wall Street Journal for over two years. Evan Ramstad is a reporter for The Wall Street Journal and is the Korean correspondent for the The Wall Street Journal. These two writers bring experience and different perspectives to the table. If they give inaccurate information it would jeopardize their jobs and hurt their careers.
Apple’s innovation has led it to success while Samsung’s re-engineering of smartphones has allowed it to cut the distance between the smartphone pioneer. In a market economy substitutes create price elasticity and competition, which are a healthy sign in the economy. Apple has been willing to provide its products at extravagant prices for several years now. “Despite Samsung's advances, Apple generates higher revenue and its profit in the latest quarter was twice as large as Samsung's. And even after its stock slump, Apple's market value of $413 billion is nearly double Samsung's $217 billion market cap” (“Has Apple Lost Its Cool to Samsung?”). This suggests that Apple products are expensive. According to one factor of price elasticity, substitutes, Samsung is a substitute to Apple making Apple susceptible to competition. Apple’s iPhone is a normal good because if consumers have a decrease in income their demand for the iPhone decreases and consumers are willing to switch to other brands. “While many analysts agree that Samsung isn't as innovative as Apple in terms of design and software capability, it has been able to match other electronics companies' products at a cheaper price” (“Has Apple Lost Its Cool to Samsung?”). The demand for smartphones from Apple has decreased because more people are willing and able to buy from Samsung because of the lower cost. Samsung smartphones are a substitute good to Apple’s iPhone. “Samsung's surge in smartphones has caused more than just consumers to switch away from Apple. Some app developers have said they are now focusing more attention on Samsung devices.” (“Has Apple Lost Its Cool to Samsung?”). Samsung has impacted other industries as well like the app developing industry. This creates competition for Apple in all fronts because an increase demand in Samsung’s phones has forced app developers to shift their attention, perhaps lowering the quality of Apple’s apps. This could hurt Apple’s sales, but it creates healthy competition and helps the economy circulating. It helps establish a point of equilibrium in the smartphone industry.
The article, “2 Harlem Gangs Broken by Arrests, Officials Say” by Russ Buettner is one that discusses how two gangs around the Robert F. Wagner Houses have been involved in selling drugs on the premises. Recently the gang has been brought down and 19 individuals have been arrested with the help of surveillance videos along with undercover detectives that gained the trust of the gang members and began purchasing drugs from them. These detectives were similar to Venkatesh in the way that they were interested in finding out more about the gang’s business, although they had different motives for doing so. This article relates to Freakonomics because the gangs spoken about in each piece have many similarities based on their practices and methods of operating. The “Black Disciples”, written about in "Why Do Drug Dealers Still Live with Their Moms?" from Freakonomics, and the “20 BLOCC and Flow Boyz” gangs written about by Buettner are similar because they each try to provide some sort of economic security to the members of their communities. As stated in Freakonomics, “The miscellaneous expenses include... gang-sponsored ‘community events’... Black Disciples were seen as a pillar rather than a scourge of the housing project community.” Similarly “20 BLOCC and Flow Boyz” helped their community financially by, “...dividing their proceeds at a community center, Cyrus R. Vance Jr., the Manhattan district attorney, said.” Furthermore these gangs were both involved in the street cocaine market, which is where they made their revenue and gained profits.
ReplyDeleteThis article is credible because it is from the New York Times which is a well known newspaper that has been published since the year 1851. Because it has been around for so long it wouldn't want to print false information that would lead to lost of readers who contribute to their profits. Furthermore this article was written by Russ Buettner who graduated from the California State University and later attended the University of Missouri Graduate School. Buettner has previously written articles that have led to criminal investigations. He was also a finalist for the Pulitzer Prize for Public Service because of a series of articles he made that revealed crimes made against specific groups of people.
The supply of drugs being provided to users is limited because of the dangers that come along with drug dealing that lead to the common use of gun violence by gang members. As written in "Why Do Drug Dealers Still Live with Their Moms?" from Freakonomics a dealer explained, “We ain’t got no choice, and if that means getting killed, well...” This shows that by selling drugs such as cocaine individuals are risking their lives, many workers are not willing to jeopardize their lives for income although they may have the necessary skill set to perform in this job. Furthermore the risk of being involved in this type of work causes members of gangs to be armed for their protection. This explains why as written by Buettner, “The office’s violent criminal enterprises unit has prosecuted 132 members of seven Harlem gangs and seized 423 guns in the last 18 months...”, and comparably the “Black Disciples” in Freakonomics had a side deals with local gunners that helped them get discounted weapons. Subsequently the incentives of an individual can lead them to become involved in situations that would endanger their lives and expose them to the use of firearms.
http://www.nytimes.com/2013/02/08/sports/baseball/jeter-fans-line-up-shut-up-and-wait.html?hp&pagewanted=print
ReplyDeleteThis week, we learned about scarcity and how the change in income or price is able to change the demand of a specific product. In the article “Line Up, Shut Up and Maybe Mr. Jeter Will Sign” Scott Cacciola shows us how devoted baseball fans (especially Derek Jeter fans) are willing and able to do anything in order to gain a spot in line to have the chance to get his autograph. This text is connected to the concepts we have learned in class, for various reasons. Because of scarcity (basic problem in economics - infinite wants, finite resources) individuals cannot get what they want at the time they want. Derek Jeter is a famous athlete that is worth a lot of money. Very few to none, have the skills Jeter has. Because of this, the demand (number of consumers willing and able to buy at a given price) is much higher than that of a different major league baseball player. It’s clear that because Jeter is so special, a lot more individuals would want to purchase his jerseys and do anything to get an autograph.
“Line Up, Shut Up and Maybe Mr. Jeter Will Sign” is credible because it was written by Scott Cacciola who is a contributing writer for the New York Times. The New York Times is an American Daily Newspaper founded since 1851 and published in New York City. It is very prestigious and would lose its value and credibility if it were to post too much biased information or unreliable information as well.
Because Derek Jeter's skills are one of a kind and he does not have much time on his hands, he is unable to give each and everyone of his fans an autograph. “Single file! No chit chat! He doesn’t want to hear about your personal life, so don’t ask him about his!” There are clearly opportunity costs (what you give up to get or produce something, not just what you paid, but also the trade off that you now have to sacrifice because of limited resources) that go along with attempting to obtain an autograph from Jeter. People come from all over the country just to get one autograph. Adults miss their jobs, students miss days of school and both even sacrifice not eating just to maintain a good spot in line. It’s all worthless though. At the end of the day, whether you get his autograph or not is just luck. Derek Jeter wants to show off that he’s busy and does not have time for his fans and that can result is fans leaving him. Some may still continue and try again to obtain the autographs. Others may give up and look for an athlete that actually genuinely cares about their fans. Undoubtedly, it is an example of economic injustice because although Derek Jeter has his good talents, he is not being appreciative of his fans. It’s not fair that he’s getting paid so much and he’s not even able to sign more than ten autographs when fans have had days without eating or moving from that spot for an autograph they will now unfortunately never get.
The text I found this week “To Lower College Costs, Obama Should Focus on Supply and Demand” written by Robert Hansen is one that focuses on how President Obama should focus on the idea of supply and demand when lowering the costs for college. This article connects to this week’s topic of supply and demand specifically on the affects supply and demand have towards each other. Hansen writes “…supply of freshman slots hasn't kept up with demand. Demand has been driven primarily by population increases and increases in enrollments by foreign students, but also by the increased realization that a college education is more valuable…”. This shows that there isn’t an equilibrium, which keeps the supply and demand rates balanced. This clearly shows that the demand is higher than the supply which makes the costs increase.
ReplyDeleteThis text is credible because it is published on U.S. News and World Report an American news magazine that was founded in 1933 and primarily focuses on political, economic, health and education stories. Also U.S News and World Report is known for its annual reports on American colleges, graduate schools and hospitals. Furthermore, Robert Hansen is a senior associate dean of the Tuck School of business at Dartmouth University. Therefore, the author not U.S. News and World Report publish an article that has inaccurate information that can lead to the audience receiving false information. This can interfere with any future accomplishments like having more successful published rankings or having their own economic/political newspaper.
Due to the low supply of freshmen slots for private schools, supply and demand has been unbalanced. The demand which is driven by the increasing populations and the increase of realization of college education being more valuable is too high when compared to the supply rate. The problem of an unbalanced supply and demand leads to a shortage which can then lead to an increase in prices. For instance, Hansen uses the example of resident tuition at the Ann Arbor campus. “Meanwhile, though, resident tuition at the Ann Arbor campus increased from $6,513 in 2000-01 to $11,837 in 2011-12, an 82 percent increase” (Hansen). This shows how most people are unable to gain their education at an affordable price. However, in this scenario, this does not interfere with the people willing and able to pay their education at the given price.
In the article “C.E.O.'s and the Pay-'Em-or-Lose-'Em Myth.”, author Gretchen Morgenson discusses the viewpoints of peer-groups who benchmark C.E.O.'s from different corporations who are at the same level as them by comparing their compensation. These peer-groups and their bench-markings are leading corporations to determine the amount of compensation that should be given to their own C.E.O.'s. This text connects to this week’s class topic on the labor market and the wage rate.
ReplyDeleteThe article that I choose this week is from the New York Times, a well known and trusted daily news organization. It was founded in New York City in 1851 and till this day still remains published. Gretchen Morgenson the author of this article is an assistant business and financial editor and a columnist at the New York Times which makes her specialized and trusted because, she is writing about the city’s finances.
The article connects to the labor market and wage rate because different businesses are trying to figure out what the wage for their own C.E.O.’s should be. Morgenson’s opponent is arguing that every business should pay their C.E.O.’s depending on what other businesses pay their own. The peer-groups are trying to set equal amount of money that is paid to all C.E.O’s. They compare it to a C.E.O from one company who is successful and comfortable enough to switch to another company that is not as much, to see if there is change. This shouldn't be the case because every business has their own supply and demand in the market for their specific product they are dealing with, so to have a specific wage set up for every C.E.O is not the right thing. Considering the fact that being a C.E.O is a finite role in the market, because the skills they have are very specific, shouldn't mean that their wages should be kept the same. Morgenson’s argument against the peer-groups was positive and made sense with the market because it shows exactly what a market economy is. She said” “Instead” “independent and shareholder conscious compensation committee must develop internally consistent, its particular competitive environment and its internal dynamic” (Elson and Mr. Ferrere). If businesses start worrying more about their individual organizations it can blend in more to the market economy because depending on the supply and demand for those business C.E.O.’s and everybody else get paid.
The Article “Guns in high demand in goshen area” connects to the topic of how the market deals with scarcity. It talks about how the demand for firearms has increased after President Obama’s proposals. This is a prime example of how the Market deals with scarcity or in this case potential scarcity. The proposals introduced by president Obama threatens to ban some guns which would take them off the market permanently. Seeing this the consumers want to buy more guns and they would find other methods of doing so including a resale market for these guns. The since the demand in infinite and there is a finite source of guns the prices of said guns will eventually start to skyrocket.
ReplyDeleteThe Goshen news in a News organization for the town of Goshen and has earned a reputation for being credible on the subjects they write about. If they were to print an article that is untrue they would lose credibility and lose their profit. Therefore any articles that they use must be true and fact checked to make sure it is credible. They also use expert opinion to boost their arguments and to make it more credible.
The products that are being sold aren’t new in that they’re next generation weapons but they’re weapons that could potentially become scarce. This is because the talk about gun control threatens to enact “new tougher gun laws in New York.”(Goshen) these laws lead the consumers to believe that the resource would be limited at one point and give consumers a reason to buy firearms while they still can. The fact that these guns might become limited makes people who might have been on the fence of buying a gun over the fence “All the talk about gun control has increased business”(Goshen) showing a clear cause and effect relationship where the government interference with guns caused an increase in the amount of guns sold. If people cannot buy guns from a regular gun store a resale market would eventually open up where the consumers sell these scarce goods at a higher price since the demand is infinite and the supply stays finite because of the proposals introduced by president Obama. When the product becomes more scarce the prices will increase, as Stoy said “These are hard to get in and we don’t have a waiting list, it would just be too long” these are for the product that is sold the most (9 millimeter handguns) showing that it is a scarce product and could potentially increase in price.
The article “Making Small Businesses a Cause” by Robb Mandelbaum, discusses the idea how small business could improve their strategic ways to improve their earnings. Using a small bakery business as an example to how the economy should deal with supply and demand, both “Making Small Businesses a Cause” and “Why Do Drug Dealers Still Live with Their Moms?” highlight the key concepts of reaching a modest price of a product, and factors such as demand could help determine the equilibrium price of a product. Similar to “Why Do Drug Dealers Still Live with Their Moms?”, the idea of price reduction is discussed when the drug business is compared to the American capitalist idea of having a successful business.
ReplyDeleteThe New York Times is a credible source because it is an American newspaper that publishes daily articles about American society. Originally founded in 1851, The New York Times has won over 108 journalistic awards, because of the high reputation, having false information would potentially jeopardize the company’s reputation. Robb Mandelbaum adds the credibility of the article because he has written several reports about small business politics and has written several Fortune Small Business magazines that highlights key concepts for the success of small businesses. Demonstrating his knowledge on the fundamentals of small business.
The price of a product is a key factor in order to determine the amount of demand a product can ultimately have. The article “Making Small Businesses a Cause” addresses how price affects the demand of baked good in her small business. Mandelbaum highlights, “that the graham crumbs’ high production cost would keep sales down and make it harder for her to produce enough [money]”, similarly to because of the high production costs of the baked good and limited amount profit in return it could ultimately jeopardize the small business’ success by bringing it close to bankruptcy and “make it harder for her to produce enough to justify hiring her first employees” (Mandelbaum). Similarly, “Why Do Drug Dealers Still Live with Their Moms?” it states that “[all businesses] want to succeed in a extremely competitive field” (Freakonomics), but in order to successfully become a profitable business you must take account the responsiveness of change in demand of your product to a change in price. Both these articles target the factor of price elasticity because in an economy, the demand of a product could be jeopardized by the price of that product.
Source: http://www.nytimes.com/2012/11/15/business/smallbusiness/samuel-adams-brewer-counsels-small-businesses.html?pagewanted=all&_r=0