Economic principles

Kimberly Adams wrote this post for American Public Media’s Marketplace on December 5, 2017. It is an example of one of the economic values that states that governments should boost business results. The implementation of the proposed GOP tax reforms has been described as a means of increasing the global competitiveness of American companies (Adams par.2). As a result, the United States has become a more appealing location for many companies to come and spend their capitals without fear of the government’s stringent policies. Through this development, the general status of the United States of America’s market will change, hence leading to improved economic growth in the country. According to the GOP’s Tax policy, the United States of America will lower the tax rates for the corporate investors, hence switching to a territorial tax regime, which would be in line with most of the other developed countries. The involvement of the government in determining the overall status of the market is very vital in determining the rate of economic growth in a given country. Through the development of different government policies, it has been identified that the market can either be affected positively or negatively, depending on the nature of the policy to be implemented (Adams par.4). According to the article, the GOP Tax policy will also mean that these companies will have the opportunity of paying out big dividends back to their shareholders, as opposed to capitalizing in new technology and advancing their labor force skills.

2.What Happens when a Town Loses its Only Grocery Store?

This article was written by Segarra Marielle on 6th December 2017. The abandonment of the grocery stores which was found in the village of Carrollton can be described using the principle of economics which states that the market does often respond to incentives. Based on this story, it has been established that the main reason which led for the closure of the business premise is the fact that it was not able to compete accordingly with the other market businesses in the market (Segarra par.1). The opening up of alternative grocery stores in the area led to the demise of this grocery store.

The newly opened up grocery stores were able to sell their goods at relatively lower prices than those of the veteran grocery store, making many people switch their loyalty to these newly opened grocery stores. By definition, incentives can be described as anything which can make a person act towards the achievement of an economic objective. Based on the fact that people do often employ the application of cost and benefit analysis, they will, therefore, have the ability to respond to the incentives. The village of Carrollton is not densely populated. It has a population of approximately 3135 people, and hence it was not practical to have more grocery stores in the region.

One of the major mistakes that the management of the grocery store made was the fact that they did not make the right decision about the market situation (Segarra par.5). In this case, the principle of economics which states that rational people do things at the margin was, therefore, extremely violated. Even though the marginal changes might be small, the increment in the marginal changes should lead to the alteration of the existing plan of action for the survival of the business organizations.

3.Surviving as an Independent Publisher in the Digital Age

This article was written by Hayley Hershman on 6th December 2017. Based on the details from the article, it has been demonstrated that the Country Roads Magazine has been able to survive in the printing market despite the developments in the printing industry brought about by the technological revolution (Hershman par.1). One of the major reason that has made this company to remain a key player in the printing market within the region is the fact that it has closely defined its area of interest. This is to provide the locals with well-curated local news about various areas, such as products in the local markets and any other area of interest, which is of great importance to them, such as their cultural developments (Hershman par.3).

The scenario which is presented by the Country Roads Magazine can be described basing the arguments on the principle of economics which states that rational business ideas do always think at the margin. The Country Roads Magazine had to make a difference in the market to guarantee its products uniqueness compared to those of the other publishers in the same market. The market competitions are not often about the number of products that a company produces, but rather the degree of the uniqueness of those products.

Customers are at most of the time associated with unique products, which can meet their needs. With the development of the digital media, the print media has been largely affected since many people have preferred getting news from different news website to read magazines and newspaper (Hershman par.5). Therefore, they only way that the Country Roads Magazine could use to remain relevant in the market was to come up with unique products.

4.How to Make Globalization Fair, According to Economist Joseph Stiglitz

This article was written by David Brancaccio on 1st December 2017. This article is about the arguments that Joseph Stiglitz had on the effects of global trade. He believed that the existence of trade is one of the important factors which determines the level of economic growth of a country (Brancaccio par.3). This aspect can be related to one of the principles of economics which state that trade can make everyone better off. Based on the information from the article, it can be established that freer trade which is made up of fewer restrictions, be it in the market or before the entry into the market, has great effects on the lives of the low-income people.

This is based on the fact that trade can allow different countries to specialize, based on their comparative advantages, and hence make them enjoy a greater variety of goods and services. The author explained that the role which was being played by the USA in the global economy inevitably was going to diminish (Brancaccio par.10). The development of a conducive environment for the development of trade is a very factor which can be used in the determination of the level of economic growth in a particular region.

Another principle of economics which has been illustrated in the article is that the standard of living depends on the rate of production of a country. Through the development of the globalization fair, there would the production of more goods and services in the country, hence leading to higher standards of living. Therefore, the economic growth of that specific country will be witnessed since there would be consumption of large quantities of goods and services, both, produced locally and those imported.

5.The Proposed Tax Credit Change Could Reduce Future Affordable Housing

The article was written by Erika Beras on 7th December 2017. Based on the provisions of the proposed tax bill, there would be the removal of the incentives for developers, hence enabling them to invest in affordable housing. To encourage the private developers to invest in the affordable housing, there is the application of the tax-exempt private activity bonds together with the low-income housing tax credit which is always at 4 percent (Beras par.3). Based on the economic principle of tradeoffs, it is evidently clear that the government has to reduce the amount of taxes which are imposed on the private developers who invest on the affordable houses, so that it can provide the citizens with the affordable housings.

The principle of tradeoffs is based on the fact that an organization has to often give up one thing in order to get another one. It is a win-lose situation. The author of the articles states clearly that without the implementation of this program by the government, there would be the creation of housing shortage crisis, especially among the low-income people. In the absence of these incentives from the federal government, there will be not affordable houses which would be built (Beras par.5).

The scenario in the article can also be described using another principle of economics which states that the cost of a particular product is equal to what a person or an organization gives up to get it. In this case, it can be justified that the cost of these affordable houses will be equivalent to the amount of taxes which the federal government had foregone in order to encourage the private developers to invest in their constructions.

Works Cited

Adams, Kimberly. “There’s more to America’s Global Competitiveness than the Tax Rate.” Marketplace.Org, 2017, https://www.marketplace.org/2017/12/05/economy/there-s-more-america-s-global-competitiveness-tax-rate. Accessed 7 Dec. 2017.

Beras, Erika. “Proposed Tax Credit Change Could Reduce Future Affordable Housing.”Marketplace.Org,2017,https://www.marketplace.org/2017/12/07/economy/proposed-tax-credit-change-could-reduce-future-affordable-housing. Accessed 7 Dec. 2017.

Brancaccio, David. “How to Make Globalization Fair, According To Economist Joseph Stiglitz.”Marketplace.Org,2017,https://www.marketplace.org/2017/12/01/economy/stiglitz-globalization-discontents-trump-trade-taxes. Accessed 7 Dec. 2017.

Hershman, Hayley. “Surviving As an Independent Publisher in the Digital Age.” Marketplace.Org, 2017,https://www.marketplace.org/2017/12/06/economy/my-economy/surviving-independent-publisher-digital-age. Accessed 7 Dec. 2017.

Segarra, Marielle. “What Happens When A Town Loses Its Only Grocery Store?” Marketplace.Org, 2017, https://www.marketplace.org/2017/12/06/economy/what-happens-when-town-loses-its-only-grocery-store. Accessed 7 Dec. 2017.