Andrena White

Econ 1740
June 9, 2016
Free or Equal

1. If the government gives everybody the same freedom to work and reap the
rewards, some will do better than others. The result will be
____________________, but not ____________________.
Answer
#1
Answer
#2

Equality of opportunity

Equality of outcome

2. Immigrants who arrived in the late-1800s/early-1900s found that America

was truly a land of opportunity. Describe the factors these immigrants
encountered which helped them thrive.

Factors

Few rules and regulations, which allowed for an equal playing field and
encouraged entrepreneurs by allowing them to directly suffer the
consequences of failure and but also directly reap the rewards for
success.
Hardship and opportunities for work.
Hard work, Enterprise and ability were rewarded directly and not stifled
by those with a vested interest.
The market was fresh and ready for innovations.

3. Although Hong Kong had no prospects, no natural resources & little land
that could be cultivated, it became an economic powerhouse. How?

Hong
Kong

Hong Kong had economic freedom with very few regulations and a
complete absence of tariffs or any restrictions on trade. The
Governor at the time favored free trade markets which encouraged
an atmosphere of incentive. Thus the market bore directly the cost
of failure, but also just as directly, gained the rewards of success.

4. ________________ have spread around the world. At the same time, weve
seen the fastest human progress ever, and it has been led by the countries
that _________________. In fact, average incomes around the world have
almost doubled. Globally, extreme poverty has been more than halved
since Milton Friedman did his series in 1980. Amazingly, 730 million people
have been ___________________.

Answer
#1
Answer
#2
Answer
#3

Free Markets
Opened up their economies
Liberated from poverty

5. Explain how the lead pencil & the smart phone are examples of invisible
hands.

Invisible
Hands

The concept of invisible hands refers to the highly dependent nature of

human endeavors. The lead pencil and smart phone are used to illustrate
this. By showing the number of people involved in gathering the elements
needed to create the pencil or smart phone, as well as the people involved
in thinking up ways of putting these elements together to create these
items; we are able to see that people are more successful and innovative
when building off of shared knowledge. In other words; in order to make
your life better, you have to better the lives of others.

6. Explain the concept of creative destruction as described in the Free or

Equal video.

Creative
Destructi
on

Creative destruction describes the constant renewal of the

economy. Which is painful and difficult, but also necessary. That is to
say that, only those businesses which are adaptable can survive. In
other words, as demand changes, businesses change. As new ideas
and innovations rise, the old are destroyed or made obsolete. An
example of creative destruction can be seen in the transition from
land line telephones to cellular telephones. This technological
transition created many new opportunities for people to use new
skills to prosper while at the same time forcing those with what was
a formerly useful skill set obsolete.

7. Explain why are Swedish entrepreneurs the oldest in the world, as

described in the Free or Equal video?

Swedish
Entreprene
urs

Swedens decision to move towards creating more equality of outcome

by redistribution of wealth, has removed the incentives that would have
encouraged young entrepreneurs to take risks and be active and
competitive in the Swedish market. Rather they have chosen to go abroad
to places where the rewards for risk are greater.

8. They (the Founding Fathers) were a wise and learned group of people.
They had learned the lesson of history. The great danger to freedom is the
________________________, especially in the hands of a government. They
were determined to protect the citizens of the new United States of
America from that danger. And they crafted their ________________ with that
in mind.
Answer
#1
Answer
#2

Concentration of power
Constitution

9. As Milton Friedman said, The society that puts equality before freedom
will _________________________.
The society that puts freedom before
equality will end up with a __________________________________.
Answer
#1
Answer
#2

Ends up with neither.

Great measure of both.

10.Professor Friedman compares the concept of equality of opportunity to a

race where everyone begins at the starting line at the same time. In
contrast, equality of outcome guarantees that everyone finishes at the
same time. Today, equality of outcome is referred to as fair shares for
all.
If we applied the fair shares for all concept in this class, all students
would receive an average grade of C. This would be accomplished by
taking points away from students earning As and Bs to give to students
earning Ds and Es. Distributing points equally would result in fair grades
for all.
1. Would you approve of this method in calculating your final grade?
Why or why not?

No, I dont think I would, I am not the best student but I think
that it would backfire. If got in on the deal early, when there were
people who still cared about doing their best, I guess I would benefit
because I could still pass the class without doing any work. If I came
to the system later, it would not be so great because, over time the
average grade would fall. People would get tired of carrying other
students grades, and, most likely, out of frustration and resentment
they would stop trying also, and thus, no one would pass.

2. Would this differ from fair shares for all economically? Why or why
not?
I think that a fair shares for all philosophy towards
economics would simply lead to economic collapse for the same
reasons outlined above. There would be a generation or two
where it seemed to work because a section of society still cared,
but eventually it would deteriorate. Why work if you dont have
to?
For example, whats the difference between a successful student being
required to give up some of his/her hard-earned grade and a successful
person being expected to give more of his/her hard-earned income? If
you support redistribution of income and wealth, shouldnt you also be
willing to redistribute academic grades? After all, many of your fellow
students may not have had the advantages in education and upbringing
that youve had.
3. Address the above questions in your own words, in a minimum of 3
paragraphs.

In order to answer this question, we must first determine what the difference
between grades and money. A grade is a method of evaluation for a students purchased
knowledge base, not a final product. a student actually pays for their grade and it
cannot be traded for other goods and services. Grades are not used to pay faculty and
staff, nor are they used in exchange for campus upkeep, supplies, etc. A grade is
something in the middle of a process on the way to a product. If you want to start a
business making ice cream, you first have to learn to make ice cream, someone has to
tell you that it is good (give a grade), and that you are doing it right before you take the
risk of starting a business.
Money is a tangible asset which can be traded for goods and services. A
successful working person being asked to redistribute their income for the greater good
assumes that the person who is donating some form of capital will also benefit from the
outcome of those contributions. It may be considered an investment in society:
community infrastructure, emergency services, and educational grants are all examples
of ways that general wealth redistribution can benefit society.
Tangible assets can be redistributed in ways that can help create new
opportunities for people who have not had the same advantages in education and
upbringing. I could take my money and pay you to teach a man to fish, as it were.
But first I would have to care more about that man than I do about my money. It is not
requisite that the person with whom I am sharing must always be a leach. Nor do I
believe that I can only be successful if someone else is unsuccessful. As a human being I
have a responsibility to help other people, by giving time and money to help them
improve their lives. The End.

Reflective Writing
Compose 2-3 paragraphs explaining how completing this assignment
helped you achieve at least two (2) of the SLCC Learning Outcomes:
Learning
Outcome #1
(Paragraph #1)

I believe that completing this assignment has helped me to

improve my critical thinking skills. I have been forced to consider,
some specific views that I hold regarding economy and money as
well has helping me to consider the origin of those views.

Learning
Outcome #2
(Paragraph #2)

I also believe that this assignment has challenged my ability to

communicate effectively. By striving to understand my own beliefs
and opinions I have also found it necessary to really reflect on
whether or not I am being understood by my audience.