Plain Sense Economics

When we study the Great Depression, and the double dip recession of 1937-38, the class discussion inevitably ends up with the role that World War II played in bringing an end to a decade’s worth of poor economic performance. Which leads us to the question – is going to war good for economic growth, and [...]

Today, in a setting entirely removed from my economics class, I used the phrase, “there’s no such thing as a free lunch.” Someone called me on it, and – full confession – I was sloppy in invoking it. That said, the rest of the challenge got me to thinking about the phrase and its application.
Milton [...]

Tyler Cowan, who writes in the Marginal Revolution blog, contributed this piece in the November 18, 2008 of The Washington Post. He both defines and applies opportunity cost. Here’s an excerpt -
But all these figures don’t quite get at Iraq’s real cost. Indeed, we usually don’t even frame the question the right way. We’d [...]

Classical economics is based on the idea that individuals and societies need certain important resources in order to thrive. Inevitably those important resources are scarce – there are not enough of them to meet everyone’s needs or wants. Much of economics is based on the question of how we go about allocating those scarce resources.
Let’s [...]