Government often adopts certain policies in order to promote desired behavior among their citizens. For each of the following polices, determine what the incentive is and what behavior the government wishes to promote. In each case, why do you think that the government might wish to change people’s behavior, rather than allow their actions to be slowly determined by individual choice?
a).A tax of $5 per pack is imposed on cigarettes.
b).The government pays parents $100 when their child is vaccinated for measles.
c).The government pays college students to tutor children from low income families.
d).the government imposes a tax on the amount of air pollution that a company dischargers.
Concept Introduction:
When markets don’t achieve efficiency, gov’t intervention can improve society’s welfare.
Want to see the full answer?
Check out a sample textbook solution- Principles of Economics (12th Edition)EconomicsISBN:9780134078779Author:Karl E. Case, Ray C. Fair, Sharon E. OsterPublisher:PEARSONEngineering Economy (17th Edition)EconomicsISBN:9780134870069Author:William G. Sullivan, Elin M. Wicks, C. Patrick KoellingPublisher:PEARSON
- Principles of Economics (MindTap Course List)EconomicsISBN:9781305585126Author:N. Gregory MankiwPublisher:Cengage LearningManagerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage LearningManagerial Economics & Business Strategy (Mcgraw-...EconomicsISBN:9781259290619Author:Michael Baye, Jeff PrincePublisher:McGraw-Hill Education