Economics is a counter-intuitive discipline. Self-interest can lead to social benefits, while public interest can lead to social catastrophes. In teaching students how these counter-intuitive results emerge different professors utilize different tactics. In The Economic Way of Thinking, we try to communicate how the opportunity cost principle applies consistently and persistently to help us understand social cooperation. Our examples are mainly drawn from newspapers and everyday life --- cutting lawns, city traffic, CD's, candy-bars, etc. But in my lecturers I rely on more "shocking" examples to wake the students up --- Marginal Benefits and Marginal Costs of searching for a mate, the economics of drug prohibition, the difference between individualists feminists and equity feminists as differences between movements along versus movement of a demand curve, the market for babies, and of course the market for body parts. In all of these examples, I will present the standard moral intuition that would recoil from treating these issues as market transactions, and then demonstrate using economic analysis that the standard intuition can be questioned because the results of using the market in this area would actually generate the consequences that the moral intuition desires (e.g., matching parents with children), while pursuing the moral intuition will generate undesirable consequences (e.g., frustration for parents hoping to adopt a child). Here is an essay I wrote on the conflict between our moral intuitions and the moral demands of the 'Great Society' and why as a matter of moral maturity we should reject our intuitions in favor of a reasoned-consequentialist position.
Gary Becker has an excellent post on the market for organs --- "Should the Purchase and Sale of Organs for Transplant Surgery Be Permitted?" The argument is not just for shock value, but has a practical importance for many individuals who would be better served in their health by such a market than the current queuing system.
Thanks to Lawrence White at Division of Labour for the pointer. Best wishes to Larry for good health and happiness in 2006.
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