(02-20-2021 09:09 AM)OptimisticOwl Wrote:  

(02-20-2021 07:56 AM)RiceLad15 Wrote:  

(02-19-2021 08:56 PM)georgewebb Wrote:  

(02-19-2021 07:22 AM)RiceLad15 Wrote:  What’s one of those founding principles that I learned in Econ 101 that is almost assuredly true? That all economic actors are rational and have the same level of knowledge - that was certainly the information I learned in Econ 101 at Rice

Seriously? If you learned these as truths in Econ 101, you either had a lousy professor or you weren't paying attention.

I guess sarcasm doesn’t quite come across on this board.

Econ 101 teaches basic principles that rely on that assumption, but you’re taught that this is the real world and those assumptions are almost never true. Hence why we can’t rely solely on some of these fundamental concepts when evaluating broader economic issues.

"Almost Never" is not the same as "not always".

So which responses I outlined in post #1075 do you think will be the response of most small business owners to a $15 MW? The rational responses A, B, or C, or the irrational response D that most progressives rely upon when making projections of the effect of the increase?

It depends on the business and a whole host of factors. Will reducing headcount reduce productivity? How are competitor prices changing in response? What percent of expenses are labor? And same question for the products used by the company - are the widgets they use going to substantially increase in price?

And if prices do rise for a product, how much? I remember some pizza company complaining about Obamacare and how the price per pizza would rise something like less than 25 cents. If that is the affect on prices, are customers actually going to decrease purchasing?

Or, we could treat it like an Econ 101 problem and remove a lot of the complexities that exist and make some very broad assumptions.