THE ECONOMIC ANALYSIS OF PUBLIC POLICY,2nd Edition

Transcript:THE ECONOMIC ANALYSIS OF PUBLIC POLICY,2nd Edition:
THE ECONOMIC ANALYSIS OF PUBLIC POLICY,2nd Edition William K. Bellinger Dickinson College Section I: Concepts and Tools for Policy Analysis The first chapter of the book introduces the reader to the basic meaning of policy analysis and its various uses in the political process. The chapter also discusses the process of critical thinking about the arguments and evidence presented in policy research and political discussion. Chapter 2 begins with a basic overview of the competitive market. It then introduces the net benefits of market exchange to consumers and producers. The model of the utility maximizing consumer is then introduced and related to a set of policy examples. The third chapter introduces the reader to a set of basic ethical goals for public policy, as well as three theories of distributional justice that can be productively applied to some applications of policy analysis. Those who wish to get right to the applied economic analysis might be tempted to skip this section. In my view the costs of that choice will ultimately outweigh its benefits. Chapter 1: The Meaning of Policy Analysis "Do not believe in anything simply because you have heard it. Do not believe in anything simply because it is spoken and rumored by many. Do not believe in anything simply because it is found written in your religious books. Do not believe in anything merely on the authority of your teachers and elders. Do not believe in traditions because they have been handed down for many generations. But after observation and analysis, when you find that anything agrees with reason and is conducive to the good and benefit of one and all, then accept it and live up to it." Gautama Siddharta, the Buddha Introduction “…my way is to divide half a sheet of paper by a line into two columns; writing over the one Pro and over the other Con…If…thus proceeding I find... where the balance lies… I come to a determination accordingly…. I have found great advantage from this kind of equation, in what may be called moral or prudential algebra.” Benjamin Franklin At the most general level, efforts to weigh the benefits and costs of a public or private decision involve some version of the economic analysis presented in this book. At a basic level, this decision process can take the form of a list of pluses and minuses, as in the quote from Benjamin Franklin,