Economics

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Economics
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On July 29, 2006 I was reading the Omaha World
Herald. On this Saturday morning my eye caught
the car ads section. On the front page of that
section is a question and answer section by
Click Clack. I do not remember their real
names. They also host (used to, anyway, and
maybe they still do) a PBS radio show about cars.
I rarely read this section, but I did this day.
The first question had to do with going on a
long trip in a car. The question was about
washing and waxing the car before the trip and
then washing the car along the way. The person
asking the question felt the washing would help
save on gas and so the questioner wanted
information from the experts. The experts said
that yes there is some benefit to the washing,
but so little benefit that the cost of the
washing and waxing would be larger than the
benefits obtained. So, from a dollars and cents
point of view the washing did not pay off.
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I was all excited about reading the story because
I thought it made sense and maybe I could use the
story in my classes so here we are. I would
like to repackage the story to make a more
general point. I will make a little diagram to
aid in my story.
Benefits
Policy or action or proposal
Costs
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The policy in the example is Wash car before, and
while on, long car trips. The benefit(s) Better
gas mileage and thus a cost saving. The
cost(s) The cost of the car wash. Economics is a
science that when looking at policies the focal
point is on the benefits and costs of the
policy. In our personal lives, when a policy has
benefits that clearly outweigh the costs, many
people engage in what the policy
recommends. Examples Brushing your teeth
everyday, washing your hands after using the
restroom, and the list goes on and on.
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We have government in our world. Policies are
recommended in this arena. Every policy that
gets mentioned has benefits. But every policy
also has costs. Please remember this. Is the
following good social policy from an economic
point of view? Every person in northeast
Nebraska should give Chuck Parker 1 each time
they drive by Dairy Queen . Hey, businesses have
policies too. Most organizations have policies.
The economic approach to viewing the world is
looking at the benefits and costs of the
policy. It seems that a lot of restaurants have a
policy that if you buy a pop you can get free
refills. Is this a good business policy? The
benefits are. The costs are..
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Well, here is my little story triggered by my
reading the Click Clack article. Should I
make it a policy as a professor at WSC to bring
in current events and other items I find in the
paper?