Semester Notes ECN 211
Popular in Macroeconomics principles
Popular in Economics
This 21 page Bundle was uploaded by Tylor Brooks on Saturday August 27, 2016. The Bundle belongs to ECN 211 at Arizona State University taught by Brian Goegan in Spring 2014. Since its upload, it has received 10 views. For similar materials see Macroeconomics principles in Economics at Arizona State University.
Reviews for Semester Notes
Report this Material
What is Karma?
Karma is the currency of StudySoup.
You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!
Date Created: 08/27/16
When Sorrows Come Crisis of the third century Emperor Severus Alexander (Looks Like Eminem) His grandmother made him the emperor of Rome since she did not approve of her grandson who was current emperor Severus became current emperor son and killed him Took the thrown at 13 years of age Severus Problems Germans were raiding borders, he bought off Germans He was assassinated march 19th 235 at 26 years of age Half a century of conflict all started with the emperor’s assassination by his own army The Causes and Consequences of the crisis Assassination Inflation String of assassinations within the roman empire Army would be promised money Metals would be mixed with lesser metal which lead to inflation in the empire The Trouble with Barter The Barter System Trade exchanges goods and services directly for other goods and services without using any kind of exchanges Suffers from the coincidence of wants (Cow and Eggs) Cannot accommodate indivisible goods (Can’t sell half the cow if you want the milk) Difficult to store wealth (Cow will Die; Eggs will Spoil) Money Money is a medium of exchanges, a store of value, and a unit of account It is used to buy and sell goods and services It allows people to transfer purchasing power between time periods It is a measurements of value, and is used to keep track of prices, revenues, and cost Many People just made their own money and issued their own currency It was the way of keeping track of the free loader in the group not as trade but as a store of value Seigniorage When governments generate revenue by print money to pay bills Inflation Caused when supply of money outplaces the increase in the intrinsic values of all goods and services in an economy Deflation When economic growth out places the money supply Rapid inflation: reduces the value of the money in your wallet Can stimulate economic activity Savings and Loans New ideas require investment o Loans made by pooled saving of groups Loans made to these ventures are risky due to the possibly of failure o Interest rates For of Risk premium D= Demand of Credit S = Supply of credit The Role of banks Financial intermediates Channel of funds from lenders to borrowers Bank Runs Occurs when a bank experiences an extraordinary large volume of with drawls driven by a concern that the bank will run out of liquid assets Liquidity Anything that you can turn into money Money or anything that can be quickly sold The Consequence of banks runs When people lose faith in their bank and pull their money out, the supply of credit is reduced Reduced deposits at banks means higher interest rate A History of Recessions Tulip Mania People Paid so much money for one flower since there were very few and they were rare Today it would be worth $37,000 Then prices dropped back to normal and a bunch of people lost a bunch of money Dutch economy suffered The south sea company British government was in debt and so they put this together to escape their debt Joint Stock Company Everybody stated buying shares within the company and then if collapsed Price drove down and collapse Companies went bankrupt cause recession in Britain The Mississippi Company People buying the stock raised the price up to 5 time its value Could not pay people back so he fled to France and people had useless stock and lost a lot of money, Alexander Fordyce- American Revolutionary Fled to London to avoid repay debts rumored to be in the mob Everybody heard and people started freaking out and doing runs on the banks Banks had to call back loans which were in America cause problems in America Something happed rules changed Boston tea party happened A Crisis Averted William and Alexander Macomb Hatched a plot Newly formed bank of the united states sold stock entitling people to its profits Ponsey scheme Could not buy enough debt and wanted to take their money out of the bank Strong government action Convinced George Washington administration buy securities keep faith in market Crisis was over a month later Free banking era Prone to financial panics ad crises People heard a story and panicked Panic of 1837 Panic of 1857 Panic of 1873 A Permanently High Plateau Everything Up Until Now o Adam Smith answered the impossible question Suggested "they will organize themselves so let them" And they did and everything organized it self o Yet there were flaws Rapid changes in behavior spook the system, and lead to difficult time The characteristics of recession o Business cycle Short run changes in the growth of GDP referred to as Economic Fluctuations or Business Cycle The GDP does not grow steadily o Co-Movement of macroeconomic variable to something worse GDP The value of all goods and services produced by an economy Unemployment The state not having a job but actively looking for one The Classic Model Cycle o Financial turmoil A brief scare banks run out if money and fail o Credit freeze Even banks that made it through the scare are unable to lend out money o Production stalls Unable to finance operations businesses are force to reduce output o Unemployment rate Businesses have to temporarily reduce workforce due to reduces incomes o And it goes back to the beginning as cycles back through The Great Scare o Monday 10/14/1907 Otto Heinze Buy stock of copper in an attempt to corner the market on them o 10/22/1907 Knickerbocker trust Taken down by bank runs New York stock exchange failed Federal Reserve System o It is the central bank of the united states AKA FED Manages the nation’s currency and money supply, dictate how much money exist in the economy a direct the minting of new money Many countries have central banks Bank for government and bank for banks Requires banks to make deposits o Can act as a lender of last resort Fed will loan banks money as a last resort o Structure Chair Janet Yellen Vice Chair Stanley Fischer Serves 4-year term Board of Governors Stanley Fischer Daniel Tarullio Jerome H. Powell Leal Brainerd And Two Vacancies o 9 regions Importance of federal funds o General Electric 300,000 people paid $7000 every month once a month $2.1 Billion o Other banks receive a total of $2.1 billion Banks loan each other money Fed manages everything The Fed in Crisis o Fail Safe Keep 10% of reserve stored Borrow from other banks using federal funds market The bank can borrow from the federal reserve using discount window o IF it doesn’t work Reserves may not suffice Other banks may not be able to loan out money Fed is concerned about the money supply The Roaring Twenties o Shift back to peace time economy was rocky after 1921 things took off o Mass production affordable to middle class Irving Fisher o Stock prices have reached to what looks like a permanently high plateau o Haunted him since a week later the great depression happened Black Thursday Thomas w Lamont, albr Wiggin, Richard whittney, someone o Bought a lot to fix the market slide o Steel to stop scaring everyone about Animal Spirits John Maynard Keynes o One of the most interesting figures of the early 20th century o Student of Alfred Marshall Marshall begged him to go into economics, but Keynes went into philosophy and statistics first o Openly gay Kept bisexual diary o Successful investor Made most money Lost almost everything in the great depression Earned everything back after and in death estate was worth more the 10 mill in modern times o Father of Economics Core of dominant school of microeconomics Problems with fundamental school o Say's Law frequently described as supply creates its own demand Markets work when we produced something we earn money Value of all production is equal to income o Rationality All savings finds its way to an investment, all workers find their way to a job Irrational to hoard your money 1936 theory of employment, interest and money o People are being irrational and collectively hording money Keynesian model o Animal spirits Producers and consumers alter their beliefs about the future and decide to wait it out o Markets freeze Consumers build their rainy day funds and producers see demand drop, so they scale back as well o Prices are sticky Contracts and inertia keep prices and wages where they are markets don’t move equilibrium o Unemployment rates Get from power point on black board Inflation and deflation o Lenders benefit deflation o Borrowers benefit from inflation Keynesian model o People have a propensity to save money, o They want to save money to feel safer o This just takes a little money out of the economy, prices adjust, and everything I ok o Fueled by animal spirit Could escalates the fear Unemployment can spread Countercyclical Policy o Only way out Monetary policy Conducted by the central bank and attempt to shore up the reserves of banks and keep interest rates low to incentive investment Fiscal policy Black board o Fiscal policy Automatic stabilizers Components of the government budget that automatically adjust to smooth out economic fluctuations Unemployment’s issue Discretionary policy o Lower taxes o Raise interest In the Long Run Were all Dead The Great Depression o Started a wave of new thinking Keynesian Model o Producers and consumers alter their beliefs about the future and decide to "wait it out" o Consumers Build their "rainy day" funds and producers see demand drop, so they scale back as well o Contracts and inertia keep prices and wages where they are, markets don’t move to equilibrium o As business stall, unemployment rises… (Finish with PowerPoint on blackboard The Classical Economist o Assumptions about the market economy Free markets Anyone can enter or exit a market and trade whatever they like Property rights Ownership and contracts are recognized and enforced Rationality People choose their best option based on the information they have o Key elements Competition drives the invisible hand that guides goo Finish with PowerPoint on blackboard Quantity theory of money o M*V=P*Y M*V= Expenditure M= money supplied V= velocity of money P*Y= GDP P=Price Level Y=Real output/ Real GDP/Quantity of good and services Y=(M*V)/P o Money is simply a medium of exchanges, store of value and unit of account The market system is not influenced by money in any real sense, all effects are simply nominal Aggregate Demand o Depicts the relationship between output and prices for a fixed money supply and velocity Y=(M*V)/P o Moves anytime the variable not represented moves Say`s Law of Markets o Production creates something of value o Markets exchange that production for its value in money o That money used by other goods of exactly the same value People don’t leave money on the table Aggregate supply o Is determined only by the quantity and productivity of labor and capital in the economy. It is equal to aggregate production Output is fixed Change only when there are changes in the economy labor Force Productivity Investment Keynesian Revolution o Keynes attacked this idea on two fronts: Economic output is determined by planned expenditures People act in advance of those plans to meet the needs of the economy Price ad wages are sticky and do not adjust quickly to change in the real economy Aggregate supply is elastic AS-AD Framework o Keynesian theory Recessions are caused by a shift in investor confidence due to animal spirits Savings is not becoming investment Get Graph from PowerPoint Money is not being spent Velocity of money slows The liquidity trap o Monetary policy only works when the money actually enters the economic cycle A situation when people are hording cash because they do not expect a return in aggregate demand anytime soon The multiplier effect o The observation that spending begets more spending Marginal Propensity to consume Spending Multiplier Get from PowerPoint Fiscal Multiplier o Y=C+I+G Get from PowerPoint A Monetary Phenomenon Keynesian Theory o Review from Monday`s lecture o AS-AD Framework A monetary history of the united states o Recessions are caused by money Not animal spirits but failure of the monetary system There is 2.999 trillion physical dollars as of March 2, 2015 Measuring money o M1: count of physical money available Paper money Coins Checking deposits Travelers checks o M2: almost everything else M1 Savings accounts Time deposits Money market deposits Short term loans Money markets mutual fund shares More than paper money o People have $11.9 trillion, but there is only about $1.3 trillion in actual money Reserves Deposits that a bank keeps as cash in its vault of with the Fed Required Reserves Reserves that a bank is legally required to hold Required reserves ratio 10% checking deposits Excess Reserves Reserves that banks hold over the legal requirement Major Economic Fluctuations o Panic of 1873 Germany and us stopped making silver coins Chicago fire Something with railroads Known as the long depression o Panic of 1893 Something with railroads Run on banks Unemployment 20% Industry hit hard, manufacturing problem o Panic of 1907 Knickerbocker scam o Post-war Dip End of ww2 o The great depression o Double dip After the great depression 1938 Major monetary contractions 1867-1960 o Milton Friedman and Anna Schwartz identified 6 periods where money supply contracted 1873-1879 Contracted by 4.9% as the us demonetized silver and returned to a strict gold standard 1897-1893 Contracted by 5.8% when fears that the us would again monetize silver led investors to move capital overseas 1907-1908 Contracted by 3.7% as banks raised their reserve ratios in response to the panic cause by the failure of the Knickerbocker Trust Company 1920-1921 Contracted by 5.1% when the Federal Reserves raised their discount rate (or the interest rate at which they lend to banks) sharply 1929-1933 Contracted by 35.2% 1937-1938 Finish with PowerPoint on Blackboard Federal Reserve Quality Tools o Reserve Requirements Ratio of required reserves to some category of deposits held at a bank for large banks, this is 10% of checking account deposits o Open Market Operations The buying and selling of U.S. government securities and other assets in the open market This is how the Fed Res influences the supply of money o Discount Window The direct lending of the Fed Res to financial institutions The Fed Res sets the interest rates and determines whether or not the make the loan o Interest Paid off Reserves Finish with PowerPoint on blackboard The babysitter’s co-op o 30 min coupons o Use in place of money for babysitting o Had to pay dues in coupons o Coupons would disappear o Started saving coupons for emergencies o People would stop using coupons and stop going out Recession entered Contracted coupon supply Problem with co-op o Prices couldn’t adjust, the value of each coupon was a half hour o Capitol hill babysitting co-op A monetary Rule o At the time of the depression, many countries were on the gold standard. A gold standard for money equates the value of a dollar to a certain quantity of gold o Freidman argued for a "K Percent rule" The supply of money should grow at a fixed rate each years Finish with PowerPoint on black board Oil Crisis o Created recession and inflation The Cold Fronts Are Listening Classical Model o Loss in credit Spooked run on bank o Output is reduced o Demand for labor reduced AS-AD o The lack of investor confidence and short fall of loanable funds contracts the money supply, and prices adjust to meet the changes in monetary factors Graph Y is fixed Price only responds to changes in money supply Keynesian model o Sticky events Keynesian AS-AD o Recessions are caused by a shift in investor confidence due to animal spirits Savings is not becoming investment Money not being spent o The economy will be slow to return to its previous levels without a boost to confidence First comes monetary policy, where the central bank increases the money supply M increases When this is not enough, then fiscal policy should be tried V increases The monetary Model o People fooled into thinking things are still the same and that nothing has changed o Babysitters co-op o Solved by economist deciding that sometimes people are needed to be in charge Others said no free market is best and whoever is in charge will mess up The Debate of the 70s o Relationship between unemployment rate and inflation o Natural rate of unemployment Inflation expectations o Friedman’s natural rate of inflation is built on the idea of inflation expectations People will attempt to adjust their labor supply for inflations, but will be based on their expectations the inflation in the future True only if we guesses right Adaptive expectation how people decide what to do while increasing wage How do people for expectations? o People for their expectations based on past experiences, the classical model will only hold true when those expectations prove correct Special case, one of many possibilities Robert Lucas o Expectations augmented Philips curve o New concept Rational expectations In the 1970s, students of Milton Friedman, in particular Robert Lucas, started to take this idea of expectations once step further, in an attempt to unite economics Rational expectation A hypothesis about how people form their expectations, suggesting that people use all Finish from blackboard Rational Expectations o Zero on average o People form their expectations rationally, deviations from the natural rate should be due only to random error Policy implications o Lucas critic Lucas`s rational expectations model undermines a half-century of economic thinking by making one simple point: the cold fronts are listening Corn flakes example Everybody will receive a free box of corn flakes every week People stop buying cornflakes Permanent income hypothesis The rational expectations argument has further implications for macroeconomic policy The permanent income hypothesis contends that people will smooth out their consumption across their lifetime, rather than let ebb and flow with their income Tax breaks Keynesian theory suggests tax breaks will help to stimulate the economy If the government rebate everyone $1000, that should increase aggregate demand Government later will increase taxes to slowly get back the $1000 they gave out in the rebate Lucas Critique o Keynesian and monetarist theories was unignorably hard hitting First, it united micro and macro, Keynes had separated Second it resonated with free-market economists Lastly, there is significant evidence that people do behave rationally o Policy-ineffectiveness Freshwater or Saltwater The Front men o John Maynard Keynes Animal spirits o Milton Friedman Reductions in money supply fooling people into reducing aggregate demand o Robert Lucas Random errors in people’s expectations The macroeconomist split up into two categories o Freshwater The efficient market hypothesis Stock market financial aspects Stock prices should reflect all available information It is impossible to beat the market The random walk Future performance should be random and not based on past performance There can never be a wrong price Rapidly adjusting prices Lots of prices adjust everyday according to market conditions Wages are frequently performance based, or adjust often through non-monetary means, such as through benefits Gas prices All generally the same no matter which gas station you are at Microeconomics Maximize their utility subject to their constraints Labor Productivity Help to explain the best way the split labor and work Real Business Cycle theory BC only happens because of "real" changes in the economy Individuals time their work to correspond with exogenous changes in the productivity of their labor, working a more when productivity is high This gives the illusion of a recession, but in facts is merely the product of a rational decision on the part of individuals to take some time off GDP is not the trend the real line is the trend Great depression should be looked at as the great vacation Policy implications Supply side factors matter more than demand side factors Fiscal & monetary policy: in effective demand management can be harmful Great depression 6 years longer because of new deal The Laffer Curve Income tax 0% what would be $0 If taxes were %100, what would revenue be $0 Laffer Curve o Saltwater Rationality The criticisms put forward by the ration expectations hypothesis were powerful Keynesian theory relies on mass delusion in order for the monetary or fiscal policy to work Businesses have to be refusing to offer jobs to hard working people at a discount People have to be refusing a livable wage simple because it doesn’t match a number in their head Banks have to be ignoring profitable investments with little to no risk New Keynesian theory Price stickiness Prices and wages are slow to adjust to changes in the quantity of money Menu cost make prices changes difficult Implicit contracts keep wages fixed Explicit contracts keep wages fixed Search cost limit job mobility and labor market competition Imperfect Competition Many, if not most, firms operate with some market power, and influence prices Restaurants can keep prices in disequilibrium, because their offerings differ from their competitors Businesses can afford to honor contracts because profits are not completed to zero Policy implications Monetary policy is super effective, but should only be used for stabilization Finish with slide on blackboard Too Big to fail The Great Recession o Start Date December of 2007 o End June 2009 The Housing Market o Securitization A security is a financial asset that can be bought and sold in a financial market Ex. Stocks, bonds, other debts turned financial product fanny mea and Freddy mac The Shadow Banking System o A collection of companies that operate like banks yet are not official banks Commercial banks Chase, midfirst Bank like Goldman sachs o 8,000 times larger than the NFL o Does not have the same insurance as commercial banks More risk o Bear Sterns 7th largest investment bank in the world Start losing money Run starts The Fed Res pay JP Morgan 30 billion to buy Bear Stearns JP Morgan only pay 1 million to settle debt The largest Bankruptcy Ever o Lehman Brothers Founded 1850 They made a few bad investments and runs started Fed res tried to get commercial banks to purchase None wanted to help investment banks participate in risky trading Monday September 15 2008 Lehman brothers filed for bankruptcy An Insurance Giant o The American Insurance Group sold insurance on CDOs CDOs became Mortgage Backed Securities Financial Accelerators o Companies need to borrow money in order to finance investment opportunities To get the loans, firms have to put up collateral, or something of value that he banks can take if it turns out the company will not be able to pay back the loan Troubled Asset Relief Program The Hangover Theory Tall buildings o The Singer Building 612.1 o The Woolworth Building 792 o Empire state building 1,250 o The sears tower 1,461 o The Burj Khalifa 2,717 feet tall The theory o Marginal benefit = marginal cost o Buildings are taller in the center of the city to make it more advantageous since it is surrounded by other buildings The skyscraper index o The property analyst Andrew Lawrence was the first to note these skyscraper oddities Theory The height is not economically justifiable Would be cheaper to make smaller buildings then 1 really tall one Construction thought to be a malinvestment Malinvestment A mistaken investment in the wrong lines of production, which leads to wasted capital Human Action o The Austrian School of Economics is not a place but a collection of ideas Originated late 19th century and early 20th century Vienna Developed by many who are part of mainstream microeconomics Major Culprit o Money creation is the original sin the leads to recessions Interest rates are artificially lowered, leading to excess investment These investments inevitably go under The Possibilities of Production o Production Possibilities Frontier A description between savings and consumption More savings/investment means faster growing economy Back to loanable funds o When fed res. Increase the money supply, this distorts the market for loanable funds The supply of loanable funds increase, but isn't being driven by an increase in actual savings In fact, by driving down interest, people save less o Consumers and investors are now at odds with each other, each taking more resources Creates increase in consumption and investment Investors and consumer trying to get the same stuff Bad investments made o Fed stops printing money Crash happens everyone has to cut back And recession Policy Implications o Austrian school economists are somewhat aligned with monetarist when it comes to policy advice The gold standard All money is backed by a fixed quantity of gold Fuel reserve banking Banks are required to keep 100% of Deposits Criticisms of the Austrian School o Austrian Business Cycle Theory is not widely accepted by mainstream economists It assumes investors suddenly don’t know what they are doing when money is easy This is both a "rational expectations" Criticism, and an accounting one The theory falls short for recessions with no evidence of an equal preceding boom The theory does not explain why these bust spread through entire economy The Debt Cycle Late find PowerPoint on blackboard to catch up Financial instability hypothesis o Hyman Minsky belongs to a group of economists who call themselves "post-Keynesians" The term has come to be a catch all for anyone working outside the mainstream Hedge borrowers Make debt payments with current cash flows Principle and interest Speculative borrowers Only have the cash flow to pay the interest on their debt interest Ponzi borrowers Don’t have the cash flow to repay either, and rely on refinancing their debts Refinances A pro Cynical Psychology o The post-Keynesian view pushes forward the idea of a pro-cyclical psychology When economy is good, investor take larger risk, and bid up price assets Eventually the credit will run out, the financial accelerator kicks in, and credit crunch People are trying to get their money The black swan theory o The event which are most difficult to predict are the ones which impact society the most EX The rise of the internet The personal computer WW1 9/11 o The odds of the events cannot even be calculated The odds of something which has never happened before cannot be empirically calculated o We seem the systematically ignore the possibility of events like these when making plans Donald Rumsfeld Quote Known knowns, known unknowns, unknown unknowns We ignore the last one Policy implications o Expansionary monetary policy Inflation makes debts easier to pay o Expansionary fiscal policy Pushes up asset prices o Counter-Cyclical Capital Requirement Requires higher reserves in good times o Regulations on "Ponzi" type borrowing Issues and criticisms o The debt-deflation theory It explains asset bubbles, standing as the only theory in opposition to the efficient market hypothesis The barlet synthesis o New classical theory Views economic actors are rational Causes of recessions Things sometimes turn out differently then we expect. We planned for one price level, and got another. The mistake isn't systematic, but due to random, unforeseeable fluctuations Cure for recessions People are smart o New business cycle Markets are efficient Causes of recessions Supply side factors Cure for recession none o New Keynesian theory See economy as having high frictions Cause of recessions Sticky prices and wages can turn a reduction into aggregate demand Cure for recessions Monetary policy is highly effective in moderating the economy by keeping aggregate demand o Austrian business cycle theory Warns against the perils of hubris Cause of recession Money creation leads to artificially low interest rates and excessive growth Cure for recessions Reflation of financial assets through monetary and fiscal stimulus The classical Keynesian solution o Recessions are messy The most recent recession All school’s ideas were within the events that happened during the recession The Balance of Payment Really late catch up from blackboard Trade restriction o Protectionism Economic policy of restraining trade through quotas, tariffs, or other regulations that burden foreign producers but not domestic producers Tariff Tax on imports Trade quotas A restriction on the quantity of goods that can be imported o Cost of protectionism The us government greatly restricts the importation of sugar, with a prohibitive tariff rate kicking in after a small amount of sugar is allowed in The result is a price of sugar in the united states that is about double the world price Reasons to restrict trade o Child labor Moral objections to labor practices, like child labor, have often been cited as a reason to restrict trade with some countries 1992 Walmart selling shirts made by children in Bangladesh Kids were fired for fear of trade stop Kids went to harsher lower paying jobs o National Security A strong domestic industry can make us less vulnerable to concerns of national security o Key industries and strategic trade Key industries Having spillover effects with larger benefit True in principle, in practice it is very hard to identify which industries these are and they often change Strategic trade Allows domestic industries to act like a cartel by limiting exports and raising the price to foreign buyers OPEC is a possible example, where limiting exports of oil has raised the price and increased profits The Balance of payments o Balance of payments A record of a country`s trade with other countries in goods services and assets Composed of two elements The current account Short term flow of funds into and out of a country Imports Exports Net income on investments Net transfers The financial account The Gravity equation The Impossible Trinity Extremely late catch up from blackboard Effects of exchange rates o Increase in domestic currency More expensive to buy Currency appreciate Foreign currency is cheaper Imports will increase Exports will decrease o Decrease domestic currency Less expensive to buy Currency depreciates Foreign currency is more expensive Imports will decrease Exports will increase The impossible trinity o Cannot have all 3 Fixed exchange rates Exchange rates are kept stable to encourage trade with other nation Free capital movement Foreign capital can be invested at home and domestic capital can be invested abroad Countercyclical monetary policy Monetary can be used to fight domestic and global recession o The only way to maintain free flow Free capital movement Countercyclical Monetary policy Purchasing power parity o The theory holds that in the long run, exchange rate moves to equalize the purchasing powers of different currencies The Veil Ignorance Late catchup on blackboard Public Policies o Rent seeking o Regressive taxation and redistribution Discrimination o Gender gap and other forms of o Nondiscriminatory businesses could beat out all other competitors Capital in the 21st century o Inequality is a feature of capitalism and markets o Thomas Piketty Returns to capital are higher than the economic growth rate of economy Tends to concentrate wealth among fewer capital owner R > G Utilitarian philosophy o Economic was formed from political and moral philosophy Diminishing marginal utility As the joy of Oreos goes down the more you eat The Veil of Ignorance o Magnum opus, a theory of justice (1971) written by john rawls Tasked with writing the rules of society but no one knows his place in society Two rules All people get basic set of liberties Allow some inequality Only so long as the worst of person is as best as they can be
Are you sure you want to buy this material for
You're already Subscribed!
Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'