Explain the issue, problem or observation
Analyze it using the economic way of thinking ? possible approaches include ( you do not need to use them all and these are only some you may consider)
Cost-benefit analysis
Externalities and unintended consequences analysis
Asymmetric and information problems
Perverse incentives
Conclusion
This is where you allow for your own judgment to come in

Ideas can come from church, school, home, personal life and such. Try to avoid big national issues, that is not the focus of this class and we are looking to apply these ideas, theories and concepts in every day life.

A brief example:

Problem: Some schools have decided to eliminate trays on their cafeterias as an environmental move to save on washing and use of water and soap and so forth.

Analysis: (this is an externality and unintended cost approach). The cost of this move is more spills on the floor, more foot traffic as people make more trips to the serving area, possibly more broken dishes, dirtier tables, and maybe other things.

Conclusion: Seems like management may be trading in one sort of cleaning (dirty trays) for others (tables and floors) and pushed some of the costs onto others, diners, as they take more time making trips back and forth. Hard to monetize and compare these but these trade offs are real.

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Explain the issue, problem or observation
Analyze it using the economic way of thinking ? possible approaches include ( you do not need to use them all and these are only some you may consider)
Cost-benefit analysis
Externalities and unintended consequences analysis
Asymmetric and information problems
Perverse incentives
Conclusion
This is where you allow for your own judgment to come in

Ideas can come from church, school, home, personal life and such. Try to avoid big national issues, that is not the focus of this class and we are looking to apply these ideas, theories and concepts in every day life.

A brief example:

Problem: Some schools have decided to eliminate trays on their cafeterias as an environmental move to save on washing and use of water and soap and so forth.

Analysis: (this is an externality and unintended cost approach). The cost of this move is more spills on the floor, more foot traffic as people make more trips to the serving area, possibly more broken dishes, dirtier tables, and maybe other things.

Conclusion: Seems like management may be trading in one sort of cleaning (dirty trays) for others (tables and floors) and pushed some of the costs onto others, diners, as they take more time making trips back and forth. Hard to monetize and compare these but these trade offs are real.

Leave a Reply

Your email address will not be published. Required fields are marked *