Identify each of the following quotes as being an example of either: the coordination problem, the invisible hand, creative destruction, or the incentive problem. a. “If you compare a list of today’s most powerful and profitable companies with a similar list from 30 years ago, you will see lots of new entries.” b. “Managers in the old Soviet Union often sacrificed product quality and variety because they were being awarded bonuses for quantitative, not qualitative, targets.” c. “Each day, central planners in the old Soviet Union were tasked with setting 27 million prices—correctly.” d. “It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.”
Identify each of the following quotes as being an example of either: the coordination problem, the invisible hand, creative destruction, or the incentive problem.
a. “If you compare a list of today’s most powerful and profitable companies with a similar list from 30 years ago, you will see lots of new entries.” b. “Managers in the old Soviet Union often sacrificed product quality and variety because they were being awarded bonuses for quantitative, not qualitative, targets.”
c. “Each day, central planners in the old Soviet Union were tasked with setting 27 million prices—correctly.”
d. “It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.”
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