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Puzzles and Paradoxes in Economics

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Overview

Economics is full of puzzles and paradoxes that often frustrate and challenge everyone, including economists. This engaging book focuses on three types of paradox. First, everyday observations that appear to belie common sense (such as why do some supermarket items sell for more per ounce in larger sizes?). Secondly, those paradoxes which have perplexed economists in the past but have since been fairly resolved (such as the diamond-water paradox). Finally, empirical or conceptual anomalies that remain unresolved and present a challenge to today's economists (such as the voting paradox). This original and unusual book will have a wide appeal, ranging from the lay person with an interest in everyday economic puzzles, to the student and teacher wishing to develop their understanding of some of the paradoxes that have existed and continue to exist in economics. It will serve as an ideal source for teachers who want to challenge their students with unusual economic problems.
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Product Details

  • ISBN-13: 9781840640496
  • Publisher: Elgar, Edward Publishing, Inc.
  • Publication date: 11/1/1998
  • Pages: 232

Table of Contents

List of figures and tables
Acknowledgements
Preface
Introduction 1
Cases and concepts 4
1 The Adam Smith paradox 22
2 The diamond-water paradox 27
3 The water problem 31
4 The case of the fourth egg 33
5 Profiting from pants 35
6 The price of quality 38
7 The rationality and risk puzzle 43
8 Gold's backward supply curve 48
9 The positive sloping demand curve? 51
10 The leisure paradox 54
11 The price discrimination dilemma 57
12 A hot vacation spot 66
13 The rare case of a Giffen good? 69
14 The case of the costly catsup 73
15 The mail order question 77
16 The businessman's query 80
17 Are teachers underpaid? 84
18 The pollution puzzle 91
19 Are market wages fair? 98
20 The highly valued occupation nobody wants 103
21 The stock market puzzler 105
22 Apples and the Alchian-Allen theorem 107
23 The perfect-market puzzle 110
24 The starvation of Buridan's ass 119
25 Does studying economics make one immoral? 121
26 The savers' dilemma 127
27 Keynes's banana plantation 129
28 Producing cars that don't sell 131
29 The feckless forecast and policy purveyor puzzle 134
30 The growing but declining gap puzzle 141
31 The perpetual poverty puzzle 145
32 The paradox of thrift 157
33 The gold absurdity 164
34 The wager over wages 166
35 The voting behaviour puzzle 169
36 The voting paradox 175
37 A taxing debate 182
38 The blessings of destruction 185
39 The interest rate dilemma 188
40 The population puzzler 190
41 The efficiency versus equality puzzle 193
42 The national debt: asset or liability? 198
43 The Leontief paradox 200
44 The perversity of Wall Street 206
Index 209
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