property and power Flashcards
institutions d
the laws and social customs governing the process of production and distribution of goods and services
bargaining power d
extent of a person’s advantage in securing a larger share of the rents made by an interaction
who has more bargaining power in the ultimatum game
the proposer
allocation d
description of who does what, the consequences of their actions, and who gets what as a result
fairness d
way to evaluate an allocation based on one’s conception of justice
pareto efficiency d
an allocation where there is no alternative technically feasible allocation in which at least one person would be better off, and nobody worse off
how do you see if any of the allocations are pareto inefficient
if there are any outcomes that are to the right or above the point (top right of the point)
what does pareto efficiency have nothing to do with
fairness
what are substantive judgements based on
measure of inequality in the allocation such as:
income,
happiness,
freedom
what are procedural judgements based on
evaluation of rules of game:
voluntary exchange of private property acquired by legal means,
equal opportunity for economic advantage,
deservingness
what is the veil of ignorance
we do not yet know which positions we would occupy in the society we are considering
technically feasible d
allocation within the limits set by technology and biology
why is angelas survival in jeopardy when bruno arrives
biological feasibility arises because of bruno’s claims on her output
how do you find out how many hours angela will have to work under bruno
it will be at the point of maximum distance between the biological survival constraint (sort of like an l (L)) and the feasible frontier
power d
the ability to do and get the things we want in opposition to the intentions of others
surplus, joint d
sum of the rents of all involved in an interaction (aka total gains from trade)
reservation option d
person’s next best alternative to a particular transactionq
how does the interaction between bruno and Angela change when she can refuse his offer
the economically feasible set is now between Angela’s indifference curve and the feasible frontier (instead of her biological survival constraint)
how do you find how many hours bruno offers Angela to work
where MRT=MRS on the feasible frontier and Angela’s indifference curve
what has to be true at the pareto efficient output
MRT=MRS
