Fundamentals of Economics. Доловова Н.Н - 8 стр.

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УлГТУ | Ульяновск

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8
8
Consider, for instance, policies aimed at achieving a more equal distribution of
economic well-being. Some of these policies, such as the welfare system or
unemployment insurance, try to help those members of society who are most in need.
Others, such as the individual income tax, ask the financially successful to contribute
more than others to support the government. Although these policies have the benefit
of achieving greater equity, they have a cost in terms of reduced efficiency. When the
government redistributes income from the rich to the poor, it reduces the reward for
working hard; as a result, people work less and produce fewer goods and services. In
other words, when the government tries to cut the economic pie into more equal
slices, the pie gets smaller.
Recognizing that people face tradeoffs does not by itself tell us what decisions
they will or should make. A student should not abandon the study of psychology just
because doing so would increase the time available for the study of economics.
Society should not stop protecting the environment just because environmental
regulations reduce our material standard of living. The poor should not be ignored
just because helping them distorts work incentives. Nonetheless, acknowledging life's
tradeoffs is important because people are likely to make good decisions only if they
understand the options that they have available.
Key concepts
efficiency – the property of society getting the most it
can from its scarce resources
equity – the property of distributing economic
prosperity fairly among the members of
society
Words to remember
to interact - взаимодействовать
goal - цель
to trade off - (зд.) сопоставить
family income - доход семьи
standard of living - уровень жизни
efficiency - эффективность, производительность,
equity - справедливость, беспристрастность
tradeoff - альтернатива, соотношение выгод и потерь
reward - поощрение, вознаграждение
well-being - (материальное) благосостояние, достаток
to abandon - отказываться ( от чего-л. )

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