20080527191611082 - Chapter 1 1. Indicate whether each of...


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中中中中中中 中中中中中中中中 Chapter 1 1. Indicate whether each of the following statements is consistent with an organic or mechanistic view of government: a. “A strong state for Russians is not an anomaly, not something that must be fought against, but on the contrary is … the initiator and main driving force of all change.” b. “The highest end which the state can serve is to serve no end at all, but merely exist as a means for the individuals within it to realize their own ends.”(Supreme Court Justice William Rehnquist, in his master’s thesis for Stanford University.) 2. French law requires movie theaters to reserve 20 weeks of screen time per year for feature films produced in France. The putative purpose is to reduce the number of US films shown in France and hence reduce the US cultural influence there. How would you expect each of the following to react to such a law? a. someone with an organic conception of the state b. a libertarian c. a social democrat. 3. In each of the following circumstances, decide whether the impact of government on the economy increases or decreases and why. In each case, how does your answer compare to that given by standard measures of the size of government? a. Normally, when employers offer health insurance benefits to their workers, these benefits extend to the spouses of the workers as well. Several years ago, San Francisco passed a law requiring firms that do business with the city to offer health and other benefits to both same-and opposite-sex unwed partners. b. The ratio of government purchases of goods and services to gross domestic product falls. c. The federal budget is brought into balance by reducing grants-in-aid to state and local governments. 4. During 2002, the inflation rate in the United Kingdom was about 2.1 percent. At the beginning of that year, the national debt of the United Kingdom was about ￡311 billion. Discuss the implications of these facts for measuring government revenues in that country during 2002. Chapter 2 1. Like economists, astronomers are generally unable to perform controlled experiments. Yet astronomy is considered more of an exact science than economics. Why? 2. In 2003, George W. Bush proposed a cut in marginal income tax rates. Explain why it is difficult to predict the impact of such a tax cut upon labor supply on the basis of theory
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alone. What kind of empirical work might help you in making a prediction? 3. MDMA is an illegal recreational drug commonly known as Ecstasy. The conventional wisdom is that the use of Ecstasy leads to long-term problems such as nerve damage and brain impairment. Recently, a scientist challenged this view, arguing that previous studies had failed “to control for other factors, such as preexisting psychological complaints or other drug use” ( The Economist , September 7, 2002, p. 71). Relate the problems faced by medical researchers trying to determine the long-term impact of Ecstasy to the problems faced by economists trying to determine the effects of economic policy. Chapter 3
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