Ten Key Principles of Economics

1. Everything has a cost. There is no free lunch. There is always a trade-off.
2. Cost is what you give up to get something. In particular, opportunity cost is cost of the tradeoff.
3. One More. Rational people make decisions on the basis of the cost of one more unit (of consumption, of investment, of labor hour, etc.).
4. Incentives work. People respond to incentives.
5. Open for trade. Trade can make all parties better off.
6. Markets Rock! Usually, markets are the best way to allocate scarce resources between producers and consumers.
7. Intervention in free markets is sometimes needed. (But watch out for the law of unintended effects!)
8. Concentrate on productivity. A country’s standard of living depends on how productive its economy is.
9. Sloshing in money leads to higher prices. Inflation is caused by excessive money supply.!!
10. Caution: In the short run, falling prices may lead to unemployment, and rising employment may lead to inflation.



Friday, September 10, 2010

The Most Generous Countries On Earth

The United States is the fifth most-generous country on earth, tied with Switzerland, according to a new ranking from Gallup’s World Giving Index.
The index is based on surveys and other research on 153 different countries, which together constitute about 95 percent of the world’s population. The survey asks in part about charitable behavior, including donations, volunteering habits and taking time to help strangers. Based on this index, Australia and New Zealand are tied as the most-generous nations on earth.

The top 21 most-generous countries, in order, are:

1. Australia
1. New Zealand
3. Ireland
3. Canada
5. Switzerland
5. United States
7. Netherlands
8. United Kingdom
8. Sri Lanka
10 Austria
11. Lao People’s Democratic Republic
11. Sierra Leone
13. Malta
14. Iceland
14. Turkmenistan
16. Guyana
16. Qatar
18. Hong Kong
18. Germany
18. Denmark
18. Guinea

Gallup’s analysis of the data found that giving money is more strongly correlated with happiness than with a nation’s gross domestic product. ”
“It would be reasonable to conclude that giving is more an emotional act than a rational one,” the report says.
Among the other findings, age and gender affected generous behaviors. Globally, giving money to charity increases with age, largely explained by changes in disposable income. Women are generally more likely to give than men, but only just barely – 30 percent versus 29 percent.
Click on the title above to access the full report.
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