1. Give an example of how “scarcity” plays a role in your daily life and decision making. What are the opportunities forgone as a result of the choices made? Scarcity plays a big role in my daily life and decision making. The item that is scarce is money. The lack of money means not being able to have all of most of things that I desire. For example, a family vacation and larger home.
2. In your work places what examples of tradeoffs do you see on a daily basis? The tradeoffs that I observe on a daily basis is companies hire, tolerate and keep bad employees who cause trouble and whose work is not that great because they don’t want to pay reasonable salaries and they constantly lose good employees because they don’t stay because of the environment. Instead of changing management to change the environment, the cycle goes on and doesn’t stop. Their only concern is profit and not anything else. What are the dominant factors of production that are seen in your places of employment? The dominant factors of production that I see in my place of employment is a high volume of work and lots of clients it’s like a sweat shop because you work very hard.
3. In thinking about how you make choices as individuals, what influences your economic decision making? How do you come to decisions in terms of consumption and how you use your resources? What influences my economics decisions is what I have now and what I am looking forward to gaining in the near future. From experience I know how much and what we use in our home. However, as I am writing this I realize that I have made bad choices because I would probably do a lot better buying larger items at bargain prices, which of course involve traveling further, instead of shopping in the neighborhood which is more expensive.
4. In our society who dictates What is Produced? Consumers or Producers? Please cite specific examples here in developing your thoughts on this topic. In our society consumers are the one that determine what is produced because products are being tracked when they are purchased it is profitable to continue to create things that more people buy instead of things that they don’t. In fact, I notice when I go to the store there are a variety of things that I buy and I know this may seem a little nuts but I am sure that I am being tracked because when I go online and search for certain things, certain brands, etc. all of sudden I find these things in the stores, in fact there are two I regularly shop at and I have those little store cards that I use for points and discounts and apparently tracking. All of a sudden items that I have never seen are there, and this has happened a lot. The stores continue to stock things that people buy and discontinue things that people don’t buy a lot of, which I don’t like, because I am one of those few people who buy things that they discontinue and when I ask about them I am told that enough people don’t buy them. In fact, I can recall one store I use to go to and buy a certain product they discontinued and I complained and they brought it back for a short time but discontinued it again.
Response to Scarcity Post by my Classmate
The example of scarcity in your post is excellent. However, I believe there is a deviation from the definition of the term from the explanation of how it affects your daily decision. Scarcity arises when the available amount of resources is insufficient (Kapp, Berger & Steppacher, 2011). Your post that scarcity of money makes you lack the things that you desire is controversial to the definition of scarcity. The desire for things is related to luxury life rather than scarcity. Need would better explain scarcity rather than desires.
The example of the tradeoff is an excellent one. However, further explanation is required regarding the association of profit and the bad underpaid employees. Trading off good employees may compromise the profitability of a company and hence the profit of the company in general. Therefore, it would have been better to explain keeping low employee number for more profit or keeping bad underpaid employees at the expense of company operations.
The explanation of factors that determine economic decision making is awesome. The decision to change buying goods at a cheaper price is excellent. However, it would have been prudent to explain as an economist if the total travelling cost and the shopping would be financially favorable.
It is correct that consumers are the ones who determines production. The production is mainly oriented to needs and rather than the flow of products. Product buying rate is more effective in managerial decisions than in deciding their production. This assertion is because, as long as there is need for a product in the market, despite the rate of buying, it will always be produced. Production is mainly need-oriented. The issue of rate of selling is profitability-oriented and is more useful in making managerial decisions to improve profitability such as diversification.
Kapp, K., Berger, S., & Steppacher, R. (2011). The foundations of institutional economics. London: Routledge.