weakest

1.
a. By applying the law of demand, the supply side is irrelevant. If we use the law of demand to predict something about human behavior, we would consider only:
a. The price (as extrageneous variable, given in the model)
b. The quantity (as the endogeneous variable, as determined in the model)
c. The analysis of the situtation so as to see how the quantity is affected by the price.
  In addition, by the law of demand, what we are talking about is the change from a point to another point IN THE SAME DEMAND CURVE, BUT NOT THE SHIFT OF THE WHOLE DEMAND CURVE.

b. This is somehow related to the problem of how to make economic model as simple as possible. In economics, if we are to use some models to predict how a variable affect another, we would hold many other factors constant (since if there are many things could affect a variable (say B), if B changes, how can we know if a certain factor (say A) really affects B, let alone the direction and the magnitude of A's effect of B?). By holding other factors constant, we could ignore the effect of the "other factors". As such, in applying the law of demand, we would consider just 2 variables: 1 extradengenous variable (a pre-determined variable in the model): price, and 1 endogeneous variable (the variable determined in the model): quantity, and "ceteris paribus" (holding other factors constant). That's why the supply curve (supply side of the market) is not considered.
  In addition, for your (1b), I don't know what do you mean by "the supply curve is asytompotic", but i think that if the "cost would raise indefinitely", there would be no supply at all, if so, noone would learn, and all guys would simply give up. But by observation, we could see that it is not the case, therefore, it should not be the case that  "cost would raise indefinitely".

c. Economics is exactly the study of human behavior under the problem of scarcity (not enough resources). If there is enough resources, everyone would get as much as they want, and why we talk about economics?
  Besides, I guess (just guess, not sure, could you please tell me if I get it wrong?) the economic model you are talking about is a standard "cost-benefit analysis" for individual. In the "cost-benefit analysis", people would choose the option with the greatest benefit (in other words, with the least opportunity cost). However, this is based on the belief that "all of the options are really available". If there is only 1 option for the students to "choose", they can't have any "choice". For those students with parents, they can have (at least) 3 choices (but for simple, i just list that 3 only): 1. to let parents do the job; 2. do the job by themselves; 3. noone take up the job. For those students without parents, they could only have 2 choices: 1. to wash by themselves, or 2. noone wash for them. In this case, the cost of choosing "to do the job themselves" (that is, the value of to let parents do the job, or noone take up the job, whichever the value for the students is higher) of those with parents are higher then those without parents (that is, noone take up the job). If so, who are more likely to give up in the working process? I think it should be the students with parents. (The same prediction, again, from the law of demand).

d. "For student that laern how to use the washing machine, many learn to use the machine incorrectly (eventually breaking the machine, a common phenomenon)"
---> It is, at least, a good sign that they are willing to learn independently. In fact, they should be ok in using the machine (for example), if they have take a look into the instruction for use. What you are talking about is the use of machine incorrectly. However, that would be a possible risk in the normal learning behavior of learning how to use the machine also. For example, the students may mis-interpret the parent's instructions, the parents maybe themselves mis-using the machines already, etc. This possibility seems not only for those without parents to learn from.

e. "THere is 3 phenomenon:
1) The well protected and well trained.  They use the machine properly and nothing happen
2) The well protected but not trained. The cannot use the machine but will try.
3) The un-protected and clever.  They can use the machine but will break it.
4) The un-protected and "pragmatic".  They cannot use the machine, give up, and seek alternative.  (Anything from changing your clothes less often, to attempting a hand wash.)

It is just a matter fact that I observe they will give up."

---> In addition, for the observation, I believe that the are some students in all these 8 groups:
1) The well protected.  They use the machine properly and nothing happen
2) The well protected The cannot use the machine but will try, and being successful.
3) The well protected.  They can use the machine but will break it.
4) The well protected. They cannot use the machine, give up, and seek alternative.
5) The unprotected.  They use the machine properly and nothing happen
6) The unprotected. The cannot use the machine but will try, and being successful.
7) The un-protected.  They can use the machine but will break it.
8) The un-protected. They cannot use the machine, give up, and seek alternative.
  However, it is just the cases that there are more students choose to give up for the group of students with parents. (the same argument, law of demand...)

2.
It may be the case that "Then a parent throw an 11-year old intot he water, he/she will drown just like the baby. ", however, it would be the case even if the victim is a 30 (or even 40) years old woman. If she don't know how to swim, and is thrown into water by a stronger person, would we say that the woman is "irrational"? By using similar reasoning, it seems like to suggest that all victims in murder are "irrational" since they are weaker (physically) then the killer. But, for me, it is obviously not the case. Physical strength is not related to rationality. That's why I don't think "he/she lack the skills and muscles" is a reason to show their "irrationality".
On the other hand, for the mental ability part, I think the 11-year old are already capable in making their own choice. In fact, there are still some adults are drown to death, are they still "irrational"? If they are, being older is not necessary of being more rational; if they are not, are there any distinction between those drown cases of adult and the 11-year old for you to say that the adults are rational, but the children are not?

3.
For your quote:此指引主要是在推行性教育時，給學校作參考之用，不應被視作一般學科的課程指引。. That means that this is NOT the instruction that schools have to follow, but just a reference for schools, and they could choose freely to follow or not. That's why the are some (at least 3 schools, one is the school shown in the hyperlink in the post #38; another is my school, and the third one is my friend's school (according to our conversation)) schools don't teach anything about sex in formal education. As I comment, when children are young, schools don't teach them about sex since "they are too young"; when they gets older, schools don't teach them about sex since they are assumed to know that info. (in other channels?? At least, it should not be in the formal education).

4.
For the seat belt problem, if they are aware of the risk of being injured, it would be arguable if they should have moral responsibility to wear seat belts. After all, it is only themselves who are getting hurted. They can't just "transfer" the injuries to other innocents. Since they are the only people who bears the consequences, it is not sure if they should be morally wrong.

dye

4.  
a) There are insurance paid by both side.
b) Grief by everyone
c) Talent lost
d) Tax dollar invested and lost
e) Court charges
etc....

Sorry to say, no man is an island, we live in a society where everyone affect everyone.  (Suicide in and of itself is immoral in the sense that it hurt your parents, at least in the tradition Chinese sense.)

To be irrational, all he.she is need is to evalute the information incorrectly.  While evaluating it correctly may yeild different result, but chance is very high that the people who do not wear a seat belt is not in such an area.

3. It is guidelines for school.  If the school do not follow guidelines from the board, they will be responsible for whatever consequences.  If sex education fail in youth, all the more reason to ban sex for children too young.  Just as if the driving lesson fail, it is all the better reason to not give out the driving licence.

2. If it is done by an old man for the same reason under the same situation, it will still be irrational.  If somehow his spirit replaced the girl and did exactly the same thing, he will still be irrational.

It is not me think- you think.  It takes mental capacity to think rationally.  There is evidence why she should not have sex.

http://www.cdc.gov/ncbddd/child/links.htm

1d.  It is easier to get it wrong when using the machina alone.  There are many useful experience and points  the parents will and have pass onto the kids as they protect him/her.

If breaking the ashing machine is ok, I guess it is ok.

1c.  there are choices.  The lonely one can choose to hand wash, the option of using the machine correctly may not be on the menu for them.  In another word, the option of the washing the clothes is somethime non-existant for the unprotected.  

the choice is more or less like

Protected
1. To let parents do the job (And get nagged, and feel guilty.  A bit of cost, a bit of gain.)
2. Do the job by themselves under the careful guidiance of the parent (Washing become an easy job here, cost is low, benefit high.  Being praise by the parent is a benefit.)
3. None take up the job. (And the parent will still take up the job and act as a model, making 2 easier next time.  Which is really option 1.)

For those students without parents, they could only have 2 choices:
1. to wash by themselves, or  (Which may not be available techically, especially doing it correctly.  Cost is high, benefit is average.)
2. perform a bare minimum of hand wash, or wash and broke the washing machine. (Easy fix.  Cost is low, benefit is minimum)
3. none wash for them. (Cost is zero, negative benefit.  It happen when you can't afford the price, which is not unlikely.)

For 11 year old, http://www.cdc.gov/ncbddd/child/middlechildhood9-11.htm  It is not a wonder why they are not allow to drive a car, work in factory with heavy machinery, vote, be a part of jury, smoke...etc

If a woman get herself into a situation where she is forcefully thrown into water without swimming ability, with all other things being equal, she is quite irrational about it.  (The man in this case is not forcing the girl into it, the girl get herself into it.)

[ 本帖最後由 dye 於 2008-1-24 18:50 編輯 ]

dye

1a. The actually quantity produced is dictated by demand and supply curve.  We would need both.  Looking at the demand curve alone, we read something like if for price of X, Y will be demanded.  Nothing about the actual quantity is said.

In this case, suppose Y washing is demanded by the unprotected, the price should  X/washing.  If the price is high, there will be no deal, if the price is low, more washing will be demanded.  The eventual number of washing is dictated by the supply curve.  

What is the cost of producing the washing?  It can be a flat line (mass production), it can be an asymptoptic curve.

You cannot have water in desert just because you want it, you can't wash you garment whe you have no garment, you can't learn how-to when you do not have the manual, you can't figure out how to when the mental ability of reading a manual is lacking, you can't develope the mental ability when you are not loved.  Every supply curve is asymtoptic at the utmost right because of physical limitation.  The only question is how fast the person is approaching it.  As a matter of fact, it is easy for the protected to forget the asymtoptic end because they rarely reach it, and easy for the unprotected to forget the flat possibility because they live at the edge.

It is differernt for different people.  The protected people has a flatter supply curve, the information and resources (including a helping hand from parents) they need is ready avaiable, for the unprotected, thereach their asymptoptic end quickly.

You either read the quantity demanded, or the price.  But never can you read the quantity produced at the end by the demand curve alone.

Anyway, as the population demand more of something, the demand curve shift (like food market nowadays).  As the need is more urgent, the elasticity change (like the insulin market).  The moving point on the demand is only for change in supply (with price) because the supply line will combine with the demand to determine "the point".

Price is also an issue.  When you have to pay a heavy price just to wash your clothes, how much resources will be left for friendship?  With division of labour and ecnomic of scale in a family, the supply curve also move to the left due to efficiency.  (It is not a coincident that married couple live a better life in general.  Poor Dye is still single.)

--------------
I like your attitude.  I think we are alike in our inquisitive sense.

[ 本帖最後由 dye 於 2008-1-24 18:41 編輯 ]

prussianz

wow !! ,
ye do really have uncountably  ,,something'' inside of your pocket , just like 'the ,,,,,ding-dong''''
.........

原帖由 dye 於 2008-1-23 10:02 發表
Below is the type of sex education for grade 6 student in HK

http://www.ied.edu.hk/pse/teach_sex_con_1.html

[ 本帖最後由 prussianz 於 2008-1-25 03:13 編輯 ]

weakest

Sorry for not reply for long time...
1. In fact, the law of demand and the demand supply model are two different models, and both can be used for different predictions for different behaviors.
A. For the law of demand, if used to predict behaviors, is simply a law stating that lower prices will result in larger quantity, holding other factors constant (but what are the "other factors" to be hold constant would be a complicated problem, not only for law of demand, but for many theories also...). In fact, it doesn't need the use of supply curve, it is not related to the supply side. There is only 1 endogeneous variable (quantity), affected by the extrageneous variable (price). Therefore, it could be somehow described as:
Price = f (quantity)
To make use of the law of demand to make prediction, we have to make it clear that how a situtation would affect price, and thus affecting the law of demand (another part that we have to be careful in applying this law).
Some basic prediction of applying this law are: 1. There will be more careless driving (higher quantity) if the drivers wear seat belts. (Because the "price" of careless driving will be lowered as they have less chance of getting injured in case of car accident. And as the result of more careless driving, there will be more car accident.) 2. There will be more sex if the guys use condom (compared to those not using). (Because the "price" of sex, like getting diseases, will be lowered as they are not so likely to get disease when having sex). 3. There will be more students take a certain course when the requirement of the essay in that course is lowered (according to a lecturer of a certain course that he teaches for certain years, witnessed this prediction is confirmed by facts), etc.

B. For the supply-demand model, what we are doing is another new matter. The price is no longer extrageneous variable, but an endogeneous variable also (together with the quantity in this model). In addition, unlike the law of demand (which states that the demand curve is downward sloping), the demand curve in this model, at least in theory, may not be downward sloping, and maybe even upward sloping (when we use indifference curve approach, we may get something like "Giffen goods"). As such, economists would make use of some ecometrics approach, and do some empirical work to figure out the demand curve for analysis. But what are the extrageneous variables in this model? Basically speaking, they are "other factors".
  What I mean is that, there are many factors (other than price and quantity) are "capable" of being the extrageneous variables. In fact, the prediction by using the supply-demand model could be done by "comparative statics approach" (i.e. compare two equilibria). In this model, the intersection point of the two curves are basically the equilibrium (given the extrageneous variables, something we cannot see in the graph of supply curve and demand curve). In fact, for those points outside equilibrium, we may hear some stories like "lower price to sell more", "raise the price to earn more" to "justify" that the equilibrium point is the "reasonable point". However, to make it more straight-forward, we consider the equilibrium points only because of the practical use of making predictions. If there are so many "reasonable points" for us to consider (for each pair of supply and demand curve), the prediction would be difficult, and maybe ambigious. For the "comparative statics approach", we compare two equilibrium points (for different extrageneous variables)  to make predictions on would these extrageneous variables would affect the price and quantity. For example:
i. Before the change, the equilibrium price = 100, equilibrium quantity = 100. If the price of substitute is lowered, the demand of the good will shift downwards, and the equilibrium price and quantity will be <100 (for an upward sloping supply curve). Therefore, in this model, we would say that: If the price of substitute is lowered, the price and quantity of a good will be lowered. (We are comparing two equilibia, one is P=Q=100, another is P<100, Q<100)
ii. Before the change, the equilibrium price = 100, equilibrium quantity = 100. If there is a poor harvest, the supply will be lowered (for agricultural products), and the supply curve will shift upwards. Therefore, the new equilibrium price will be >100, and equilibrium quantity will be <100. Therefore, we would say that: for agricultural products, if there is a poor harvest, the price will be increased, and the quantity will be lowered. (We are comparing two equilibia, one is P=Q=100, another is P>100, Q<100)
  In here, we consider the equilibrium points only. If some more points are considered, the results may be ambigious.
  In fact, the concepts "quantity demanded", "quantity supplied", "equilibrium quantity", "equilibrium price" are not really something exist in this world. It sounds silly to ask someone in street "What is your quantity demanded if price =$5 for a coke?". Although we may use some statistics method to make a guess for the demand curve, but the concepts are simply used as means for the final prediction (e.g. "poor harvest leads to higher price, and lower quantity") only.

  So, my argument "those students who are protected will be more likely to give up" is simply an argument from the law of demand, not the supply-demand model.

  By the way, for your supply-demand analysis, if you believe that the unprotected can't work the machines (for example), a more straight-forward way is to say that "the quantity supplied will be zero, at whatever price". For the quantity supplied, it depicts the quantity to be supplied (able and willing) at each price in supply curve. If you say that the quantity supplied is flat (horizontial), it means that, for a given price, the quantity supplied could be any number (if the price is higher, the quantity supplied will be very large, if the price is a bit lower, the quantity supplied will be zero), that means, the unprotected are still able and willing to supply any quantity (which, i think, in this aspect, different from what you want to say...). In addition, in supply-demand model, the equilibrium is determined by the joint force of supply and demand. Therefore, for your words "It is differernt for different people.  The protected people has a flatter supply curve, the information and resources (including a helping hand from parents) they need is ready avaiable, for the unprotected, thereach their asymptoptic end quickly.", I think there are two problems:
i. What are would observe (the point "reached" by the 2 groups of students) is not necessary the equilibrium point. Otherwise, we won't observe inventory in many markets (excess supply), or people lining up for goods (excess demand). As I said, the equliibrium price and quantity are simply imaginative concepts, for the prediction only.
ii. Even if we say that the observed point = equilibrium point. There is still a problem. The equilibrium point to determined by the supply AND demand. Therefore, even if the asymptptic end point is near, if the demand curve of the two groups are the same, and if the supply curves of the two groups are flat, the equilibrium point would be the same for both groups. That means, the two groups are indifferent (and I think, this is not what you want to say also...).

By the way, I agree with you that "The moving point on the demand is only for change in supply (with price) because the supply line will combine with the demand to determine "the point", but it is only the case for supply-demand model, but not when we are using the law of demand.

Also, for your statement, "With division of labour and ecnomic of scale in a family, the supply curve also move to the left due to efficiency.  (It is not a coincident that married couple live a better life in general.  Poor Dye is still single.)" , I agree with you that more people in a family would be likely to make a better life in general, because of division of labor (that's why I always thinking of why we should have "一夫一妻制", but not "二夫二妻制", "三夫三妻制", etc. For example, under "一夫一妻制", one people are better to work for income, therefore, there remains only 1 person for housework. However, if the remaining one goes to market to buy things, should him/her carry the baby out to the market also (the market seems too crowded, and too dangereous)? Or just leave the baby at home (too dangereous also to let a baby to be alone)?). However, "efficiency" should not be something that shift the supply curve. It is simply a welfare measurement of a certain situtation, it can be maximized when marginal value for the society of the good = marginal cost for the society of the good. But it is unrelated to supply curve...

prussianz

原帖由 weakest 於 2008-1-26 01:51 發表
Sorry for not reply for long time...
1. In fact, the law of demand and the demand supply model are two different models, and both can be used for different predictions for different behaviors.
A. For  ...

>>>> Sorry for not reply for long time...

u dont need2say sorry , i could wait reading yours + My-Dear-Sir-Dye's .........

dye

Option 3
Have the baby in day care center (By government?)

Option 4
Have the baby handld by a house worker

Option 5
Go to a less crowded market

Option 6
Make sure the husband is at home even if he is just stitting there watching TV when the wife go shopping

Option 7
Ask you
a) Neigbout
b) Friends
for help.

-------------
Warning:  Leaving a child at home alone is known to cause death.
--------------
For a large size family, we may have a coordination problem.  For a family of N member, the commication channel = (1+N)N/2

Also, we are humans, not bots.  Our natural sexual jeoulousy will cause internal conflict.

There is a cost in running a large family that people can decide if they want it or not.

---------
If  achieving the same goal at a lower cost (efficiency) will not shift supply curve, what will?

Here is a page on basic economics

"2. A change in technology."

-------------
For how the quantity is determine, please see

[url=http://william-king.www.drexel.edu/top/prin/txt/SDch/SD15.html]http://william-king.www.drexel.edu/top/prin/txt/SDch/SD15.html[/url]

"This sort of "equilibrium" exists when the price is just high enough so that the quantity supplied just equals the quantity demanded. If we superimpose the demand curve and the supply curve in the same diagram, we can easily visualize this "equilibrium" price. It is the price at which the two curves cross. The corresponding quantity is the quantity that would be traded in a market equilibrium"

----------
Invisible hands, invisible hands.  The price will MOVE towards the equilibrium.  But while we are at it, there will be excess and shortage.

Besides, technology is "chucky".  If the equilibrium is at 1.5 wife, there is really nothin we can do about it.  (Either 1 and shortage, or 2 and excess)

Here is a another explanation for why there is excess and shortage: we do not have perfect information

[url=http://william-king.www.drexel.edu/top/prin/txt/controv2/un0a.html]http://william-king.www.drexel.edu/top/prin/txt/controv2/un0a.html[/url]

(Nonetheless, just like employee will "tends" to find a job, so do the price tends toward EQ)
-------
For law of demand, the last word is critically important

At a higher price, the quantity demanded will be less, ceteris paribus. (Ceteris paribus means: if nothing else changes to offset the change in price).

Quantity DEMANDED.  Not just quantity.  Because we also have quantity SUPPLIED (The true determinant of the quantity at the end because we can demand all we like but if no one supply the goods, it will not fall from sky).

[ 本帖最後由 dye 於 2008-1-28 16:13 編輯 ]

weakest

1. Unfortunately:
Option 3: "excess demand" by now in HK
Option 4: In HK, there are so many case of abuse of children by house worker (especially those foreign house worker).
Option 5: In HK, almost all markets are very crowded... (and I saw a women put a baby into a "cart", and to buy things in a very crowded market. It seems very dangerous for me...)
Option 6: If the husband is working, how can he watch TV at home? (The market won't wait until the husband is back to home in HK...)
Option 7: This maybe ok, as long as there are some fd. or relatives available.
Therefore, this problem alone could be headache for some small families. (As you said, larger families could allow division, and thus a better standard of living)
  There maybe higher cost for the family to be larger. However, isnt it make it better to allow people to have more choice available? (only 1 option (1 wife/husband) VS 2 options (1 wife/husband, or 2 wives/husbands))

2. For the "efficiency" in my previous post, it is a concept to measure welfare (how to maximize welfare given a certain level of technology, and resources) , but not the cost of production that shift up or down the supply curve. In this interpretation, the efficiency doesn't determine the supply curve. For allocative efficiency, MR (marginal revenue)=MC (marginal cost); for productive efficiency, total cost of production is minimized. It is not related to supply curve.
  If you mean lowering cost of production by technological advancement by "efficiency", I agree with you that higher efficiency could lower the supply curve, in the supply-demand model.
  But "efficiency" is always used to be a welfare measure in the course I have taken.

3. Well, I just saw "Page not found" in the 2 hyperlinks...
  By the way, what you quote is simply that "in equilibrium, quantity demanded = quantity supplied". In fact, the price and quantity are determined in this supply-demand model. As I said, these 2 are the endogeneous variables in this model. By the way, it should be noticed that in your quote, "The corresponding quantity is the quantity that would be traded in a market equilibrium", it is simply a quantity IN EQUILIBRIUM, NOT IN REALITY. In this supply-demand model, equilibrium is not something real, but only something used (as a tool) to derive predictions. Otherwise, we would see a strenge transaction of goods that have following characteristics:
A. (In Walrasian supply-demand model) There is a God-like being (hopefully, not Christian God...) that ask everyone: Give me your quantity demanded/quantity supplied. And this being (so "irrational" that don't ask for compensation at all...) would be so good to determine the price of all people. (Not sure if it is the "invisible hands" that people always mentioning now...)
B. The transaction of goods would be of no excess supply nor excess demand. Therefore, you should see no stock (for no excess supply), and no lines to line up for goods (for no excess demand).
  By the way, for the normal demand and supply curves, we tend to assume continuous demand and supply curves.

4. In normal equilibrium, there should be no shortage (Qs < Qd) (where Qs = quantity supplied, and Qd = quantity demanded), and no surplus (Qs >Qd).
  By the way, if you say "the price will moves towards equilibrium", it seems to me that you are also suggesting what I want to say: equilibrium is not the actually observed situtation.
  However, I have some conservation about if the price would really tends to equilibrium. If the price really tends to equilibrium, we should observe changes in prices of all goods (holding other factors constant). If not, how come the "price tends" to some level? (Consider a number pattern: 5, 5, 5, 5, 5, 5, ..... Would you say this number series "tends" to some other numbers?). However, the "holding other factors constant" is itself very difficult in our everyday observation since there are so many factors that could affect price, and we just can't have "controlled experiment" in economics (for example, in argicultural, we can't control the weather change...). Therefore, even if we observe some price change, we have at least two possible explanations:
A. Price really "tends to" equilibrium
B. Change of other factors
  And how can we be so sure that the price change is ONLY caused by A, but not B?
  So, would it be more plausible to observe if the price really tends to equilibrium by the magnitude of "excess demand" and "excess supply" (if the excess demand, measured by the length of the lines for example; or the excess supply, measured by inventories for example, becomes less and less, it seems that the market "tends" to equilibrium)? However, if we use this approach, it seems that there is no such trend that the excess demand or the excess supply becomes less and less. Also, would companies be satisified to see that their inventory becomes less and less? Or they would be unsafe to observe this decreasing inventories?

  In addition, your 1.5 units example is exactly an example to show that equilibrium is not exactly the same as actuality.

  However, while "imperfect information" could make sound theoretical explanations, it could also make predictions more difficult. If such an "imperfect information" could be used to explain some dis-equilibrium, which point should we start from? Which points should we use to make predictions? What sort of prediction could we make by this new version of demand-supply model? Would we still be able make predictions like "if there is bad weather, the price will increased, and the quantity will be decreased", or we would only make some ambigious predictions like "if the weather is bad, the price may increase, remains constant, or decrease" (since there is no clear "equilibrium" point to follow)? At least, it would be difficult to perform the "comparative statics" to get predictions in demand-supply model.

5. I agree with you that the last words (ceteris paribus) is very important. It is also something difficult. For example, something like real income would be changed if price change. So, what is the "things" to be hold constant? In fact, it is also important in other models also. If there are so many variables could be changed at one time, and resulting a change in an endogeneous variable, how could we know how each of these variables affect the endogeneous variable? Therefore, I think "ceteris paribus" as something a bit different from you:
A. Yes, "nothing else change"
B. But, not only "nothing to offset the change in price", but also "nothing else is changed to make it more difficult to figure out what is the price effect, and what is the other factors' effect " (For example, if 3 factors (price, A, B) affect the quantity, and raise the quantity by 1 unit, the other factors don't totally offset the price effect, but it would be troublesome to figure out the effect of each factor). Therefore, "ceteris paribus" provide us with the convenience that we can ignore the effect of other factors, and only concentrate on the price effect. After all, this world is too complex, we have to find some ways to simplify it before economic analysis could be done.

  For the law of demand, the lower price results in higher quantity demanded. However, if used alone for prediction, we would think of demand-side only. We won't think of the supply-side also. It is just like when we simply focus on the output market, we won't consider the labor market also (unless we want to figure out something about labor in economics), and many other models. Therefore, for convenience, I would call "quantity demanded" as simply "quantity".
  Yes, we can't get all the things we desire as we have unlimited wants, and limited resources. However, what the law of demand suggest is simply that lower price will raise the quantity, but not that the quantity will be raised to infinity.

dye

Option 4:  How many domestic helpe is there in HK compare to the abuse case?

Option 5:  City Super is not crowded.  ParkN Shop (if you know when) is not crowded.

Option 6:  Wait till he goes home?  
a) Shop once a week during holiday
b) ParkNShop open till 10:00pm.
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If we open the choice for 2wife/husband, we will also open the option for 2 husband/wife.

Since aniceint time,  2wife/husband is an open option in China but most people still choose 1 wife/husband.  

I am in total support of opening the option. but family should consider the choice carefully.
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Efficiency in my courses is always about the ratio of benefit/cost
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3. It is tending to the equilibrium.  No one said the market will be at precisely the equilibrium.

In typical day-to-day life, things are counted not in a continuous manner.  You eitherhave 1 machine or 2 or none.  It is imposible to have 1.1 machine.
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4.  Price do change.  We have inflation?

Excess in demand and supply is accounted for in he equilibrium model.
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If the weather is bad, the supply curve for the crop will move up.  If the demand do not change, the price will move up and quantities smaller.

But what if the bad weather is atticipated and the price has already moved up and quantities has already dropped?

What if there is a news blockage and the shift in supply is not known yet (till delivery)?

All these are reality.  The world is complex.  Nonetheless, it is still possible to study models with multiple factors.
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Not ceterius paribus.  But quantity DEMANDED the word "demanded"

The demand curve said nothing about the quantity traded, but only DEMANDED.  The supply curve said nothing about quantity traded but quantity SUPPLIED.

I think you are still get the wrong idea about law of demand.

The law of demand said if you lower the price, the quantity DEMANDED will be higher.

In reality, if you lower the price, the quantity DEMANDED may increase (As the CEO interviewed y Economic Journal said, it does not work when you are selling Luxury due to human psychology).  But there is certainly cases (for example, the housing renting market in Toronto when the goverment lower the price by law), that causes the quantity traded to decrease.

[ 本帖最後由 dye 於 2008-1-29 10:00 編輯 ]

weakest

Option 4: In fact, I don't have any statistics to support my point. Therefore, the backing of my point seems not too strong. In fact, it is just a point that come up from my impression, because I often see the news of child abuse cases by foreign helpers, but didn't see the news of child abuse by local helpers.

Option 5: In fact, there are no CitySuper in every town in HK. (For people living in some places, they have to travel long to get to the nearest CityCuper...). Also, the price of the goods in CitySuper tends to be more expensive (in my impression again) than traditional markets, and too expensive for normal low-income families to buy.
  On the other hand, the two oligopolists: welxxxxe, and Parxxxxxop, in supermarket, have more branches all over HK. And for families, it is convenient for them to find either one (or both two) nearby. However, some people don't like to buy from supermarkets since the goods are not fresh enough, and of less variety. In addition, although it is not so crowded in supermarkets, the path in supermarkets are quite narrow. It is not risk-free.

Option 6:
a. This shopping pattern is not popular in HK, since people like fresh food. In addition, there would not be sufficient place of the people to store so many food for a long period.
b. Yes (despite the staff will close the door at 15min. earlier for convenience in counting stocks, but this is not of much difference). But this could only apply for those don't need to OT (over-time) much, and those don't need to work at night...

  I also think that we should open the option. And let people make their own decision. For "2wives/husbands", I mean that each woman can have 2 husbands, and each man can have 2 wives. I don't just mean each man can have 2 wives. The "/" stands for "or", but not "per".

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2. Benefit/cost ratio... Is that "benefit" means the profit for firms? Or the benefit for consumers? Or the total benefit of the society as a whole? (Maybe the terminlogies used in our courses are different^^)

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3. Again, as I said, how can we make judgement on if the market is really "tends" to equilibrium? Price always change, it can be caused by:
a. "tends" to equilibrium
b. change by other factors
  How to make sure that it is only factor a cause the price change? How to make sure that the price change is not only caused by b?
  How about if we use the trend of the stock of inventory to judge for the tendency of "excess supply", and that of the length of lines for the tendency of "excesss demand"? It seems that there is no such trend that the stock of inventory of companies would be smaller and smaller, and the lines would be shorter and shorter over time, holding other things constant. Would companies having a certain policy on the inventory stock see the decreasing stock not as a sign of danger, and not to do something to increase the stock back to the normal level? (If we have a series of numbers: 1, 2, 3, 4, 5, 6, ....; we would say that these numbers tend to a certain level (other than the existing level). But if we have a series of numbers: 1, 1, 1, 1, 1, 1, ...; would we say that the numbers tend to some other levels (other than 1)?)

  Yes, many things are not counted in continuous manner. But in the standard demand-supply model, when we use graphs, we would use continuous functions. However, would people challenge the demand-supply model because of this? This is simply a matter of abstraction to make prediction more convenient (by comparative statics approach). Also, before we say it is not possible to have equilibrium at which Qs=Qd since we cannot have 1.1 machines. We have to figure out if the equilibrium in the theory occurs at this level, or at other level (for example, of 2 machines). But could we really figure out the equilibrium by observation? (We don't have a God to ask every buyer: "give me your Qd at price = $1, $2, $3, ..." ; and to ask every seller: "give me your Qs at price = $1, $2, $3, ..." ; and to make horizontial summation to get the market Qd and Qs, and to set the price such that Qd=Qs, and to ask every buyer and seller to follow the price)

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4. Of course, in macro-economics, the real income is measured by the affected by the price level as the whole. Therefore, a decrease in a single good may not leads to increase in real income (since the price of all other goods may increase). Therefore, it comes up with concepts of "inflation" (increase in GENERAL price level), "deflation" (decrease in GENERAL price level) such that we can get the aggregate measure of the price level so as to measure real income. However, in micro-economics, we don't have to rely on the concepts of "inflation" to say something on real income. For example, for the law of demand, "if price of a good falls, the quantity (demanded) of that good will fall, ceterius paribus". In here, when we analysis the effect of price decrease of a certain good (say A), if we hold the price of ALL other goods (B, C, D, E, F.....) CONSTANT, the real income of the individual must be increased. On the other hand, if we hold the real income constant, the price of ALL other goods would NOT be constant, since there must be some increase in the price of all other goods to make the real income constant. If you analysis the effect of the price change of good A, but holding real income and the price of all other goods constant, you would get into trouble of getting an inconsistent story (can real income be really constant if the price of a good is lowered, and the price of all other goods are constant?). In here, we don't have to rely on the concept of "inflation" to say something about the real income.
  In fact, for indifference curve analysis, economists would say of "income effect" and "substitution effect" as two components of price change of 1 good. For the income effect, the decrease in the price of 1 good, the consumer's real income is increased. In here, we don't have to use the concept of inflation to say of the "real income" in here also. In fact, if we use 2-goods model for the indifference curve analysis, one good (say X) is the good we want to analyze, and the other could simply labelled as "other goods". There are (at least) two ways of finding out the "income effect" of the price change (Hicksian approach and Sltusky's approach (may have wrong spelling for the two names...)). I don't know which references are good for you to check. But I think some university level micro-economics textbook would have this "income-effect" mentioned in indifference curve analysis. (As I remember, Form 6 textbook do mention something about this. But I am not sure how to correspond HK's "Form" in Canada's "Grade"...)
  In fact, ceterius paribus is a way for us to ignore the effect of so many factors since the world is too complex. However, it is also a difficult job to consider what factors to be hold constant, and what factors should be allowed to change as a certain extrageneous variable varies. In using the law of demand, we usually hold the price of all other goods constant. As such, the real income of the people should be affected (when measured by indifference curve analysis). However, it is still ceterius paribus. Otherwise, we would get inconsistency.

  Also, it would be troublesome to allow excess supply or excess demand in the demand-supply model. If the cases of excess supply or excess demand can be used as the starting point of making prediction, what kinds of prediction could it make? Consider the following case:
A. Demand curve is downward sloping, supply curve is upward sloping. And both curves are continuous.
B. Equilibrium (at which Qs=Qd) price = 100, Equilibrium quantity = 100
C. If we allow excess demand or excess supply, some points like Qd = 90 (not at equilibrium) could be used as the starting point for the original demand and supply curves.
D. If the supply curve shift upwards by bad weather, the equilibrium quantity becomes 95.
E. If we allow excess demand or excess supply again, we may get a point of Qd = 92 (quantity is increased), or Qd = 90 (quantity is constant), or Qd = 85 (quantity is decreased). All of these points are outside equilibrium.
  So, what could we say about bad weather if we allow excess demand or excess supply in the demand-supply model? Nothing but an ambigious prediction: The quantity may increase, may be unchanged, or may be deceased. As such, this version of demand-supply model could be quite useless in making predictions.

  If the demand-supply model is simply a thing that can only tell us that: "You see, this model can explain lining up for goods, and stocks of inventory. When there are people lining up for goods, there is excess demand; when there is inventory, there is excess supply.", this model seems to be useful only for fun, but not of any practical purpose of making predictions. I can know that companies have stock of inventory by direct observation only, and I can know there are people lining up for good by direct observation also. There is no need for people to construct the demand-supply model to tell us about that.

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There are something to say about bad weather example:
A. EXPECTED price increase by EXPECTED bad weather is NOT bad weather HAPPENED. They are two different things, and they are two different factors affecting price and quantities. In your example, the price increase is caused by the expected price increase. The effect of the actual weather, another factor that affect the price and quantity, is of another new analysis.
  That's why I said it is so difficult to analysis the effect on price and quantity if there are more than 1 factors working to affect the price and quantity.
  In addition, are you sure that the quantities must be decreased by the expected price increase? The supply curve shift upwards, but the demand curve shift upwards also.

B. For the news blockage problem, that's exactly one factor that makes "EXPECTED" not the same as "ACTUAL". This would just be the case that there are 2 different factors affecting the price and quantity at different time, as it was in A.

C. Yes, the world is complex, therefore, we have to find some way to simplify it. And the working of more than 1 factors would make it more difficult to find out which factor constitute which effect to a certain endogeneous variable. Yes, it is possible to study models with multiple factors. However, we would hold some of these factors constant, or simply set up more equations within the model to find out the relationship of 2 factors. (We can't solve 2 unknowns with 1 equation, but 2 equations (at least)). Also, would you think that a model with less variables would be more simple in general?

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5. Well, as a matter of terminlogy, demand curve shows the relationship between "quantity demanded" and the "price". And in law of demand, it is something about the price and quantity (demanded). But in here, for convenience, I would simply say "quantity demanded" as "quantity" since the word "demanded" is not so important since we don't have to consider supply-side in here, and there is nothing of "quantity supplied" when using the law of deamnd alone to make predictions. However, it should be noticed that under this law of demand, it is NOT NECESSARY to talk about the things to be TRADED. Instead, we could make many predictions that is NOT about TRADE. For example, "with the introduction of condoms, there will be more sex behaviors" (is it reasonable to say "the wife "trade" sex behavior with husband"?). In fact, one of the advantage of using the law of demand alone, and without considering the supply side is that we can say something about human behaviors that is not about trade. The law of demand can derive many predictions about human behaviors like those I have mentioned in #45, and they are not necessary about trade.
  Also, the demand curve have to be considered with supply curve only when we use supply-demand model. When using the law of demand alone, it is not necessary to use the supply curve. It is two totally different matters. Just like we don't apply some game theory concepts into the normal supply-demand model for analysis (unless there are some other purpose to state something about strageic interaction in this supply-demand model), we don't consider the supply-side if we use only the law of demand to make prediction since the supply-side is irrelevant for our use of prediction.

  Well, by law of demand, price and quantity are negatively related. It is something of must. Otherwise, you will come up some predictions like "if the price increase, the quantity may goes up, remains unchanged, or goes down.", which is useless again.
  I think the CEO in your case is simply mentioning about the "money price" (only the money that we have to pay of a certain good), but not the "full price" (all the things we have to give up to get a certain good, like time, other goods, money, etc.) . In the law of demand, the "price" should be the "full price", but not the "money price" only. Therefore, as the CEO said, the (money) price change may not increase the quantity of buying the luxury goods, but yet, it is not the refutation of the law of demand, by the (at least) two reasons:
1. The full price is not decreased even if the money price is decreased. It is because the time cost of buying the goods may be increased as the money price falls. As the money price falls, there will be more people rushing to the shops, and this makes consumers waste more time in lining up. Therefore, the full price of the good may be not decreased simply by the price decrease.
2. CHANGE OF OTHER FACTORS. As the CEO said, it is something about human psychology. That means, by lowering money price, the "goods" itself is no longer the same good. In marketing view, pricing is itself a characteristic of defining a brend, especially for luxury goods. Therefore, by lowering the price, the goods are no longer the same good as before, but simply a more inferior version of the goods. Therefore, people will demand less of it as it is inferior. Therefore, with this effect of "other factor" (change of goods nature), there could be less people buying the goods. Therefore, this case is simply a reminder, telling us the importance of "ceterius paribus" (we have to think carefully if there are really other factors working that would affect the results), but not a refutation of the law of demand.

dye

Option 4 There are about 180,000 asian foreign worker (2006).  in which 90% of Filipino and Indonesian will fit into the category of elementary worker.  in which most are really domestic worker.  You are talkig about something around 162, 000 workers here.  

How many case have you read in the newspaper?

Option 5 The few are example.  There is also Hua Yun that is not crowded.  Mother can proceed carefully in narrow place and the risk will be minimum.

For freshness, there is refrigerator.  In any case, the parents are unwilling to sacrifice a bit of freshness of food for the safety of their child?

Option 6 For a family of 3, the space needed for a week of food is not that much.  As my cousin said, they will need to learn refrigerator space management.

Option 7 So one of the spouse work overtime ALL the time?

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Efficiency is used in many different area of study.  The benefit can include many things depending which perspective is taken.  

From dictionary
(1): effective operation as measured by a comparison of production with cost (as in energy, time, and money) (2): the ratio of the useful energy delivered by a dynamic system to the energy supplied to it
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3) EQ is not stationary.

For supply, we can ask/survey the suppliers.  I am pretty sure it can be done because I am part of this side of the system.

For demand, we have market research.

I am not an economist.  I imagine it takes some innovation to figure it out.  It does not take a spaceship to determine the distance of stars, it is only a matter of innovation.

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Do you know why price and quantity will tend to EQ?

If the price is below EQ, there will be more goods supplied than demanded.  The supplier will compete to lower the price to get the overstock sold.

If the price is above EQ, there will be less goods supplied than demanded.  The consumer will compete with higher price to get the limited supply.

No God is needed.  Just invisible hand at work.
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For the weather model, there is less food at the end to trade because of the weather.  It is a FACT the weather model begin with.  We can't sell food we do not have.  If the bad weather do not affect the production, it is not much of an influence (unless we have mis-information).

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If real life has may variable, we cannot ignore them in real life.  The task is to model the real world?  Not to make things simple?

weakest

Option 4: As I said, it is simply my impression. I am not sure about the number of cases, and even can't say about the number of news i have seen. That's why I said I don't have strong backing of this point...

Option 5, 6: That really depends. Welxxxxe and Parxxxxp have more branches than CxC shop. Therefore, the former 2 seems to be more available to families. Also, CxC shop may also be quite crowded sometimes. But, I agree with you that: shopping in supermarket seems to be less risky. Also, I agree that people are better to learn more about refrigerator space management.

Option 7: I am not sure about this. But in my impression, there are so many people (at least, those graduates I know) have to work for quite a long time (usually, or even always)...

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  It is just a matter of terminology used in economics course. In fact, it is normal for people studying other subjects have some other interpretation. Just like I have so little knowledge about biology ... In fact, the terminologies have some meaning other than that in our normal use of languages.

  Basically speaking, in economics, "efficiency" is a measure of welfare. For the production of certain goods, it brings some benefit to the society as a whole, but it also brings a cost (opportunity cost, another terminology in economics) to the society as a whole. For the production of a good to be "efficient" (welfare is maximized), the "benefit - cost" should be maximized. As such, it is impossible to make someone better off without making others worse off.

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  In the supply-demand model, the equilibrium could be "stationary", depending what you mean by "stationary".

  In many economics model, by equilibrium, there would be no tendency for people to deviate from the equilibrium point. For example:
a. in supply-demand model, for normal cases, there would be 1 equilibrium point at which Qd=Qs. In this point, people won't deviate from this point. However, for other points at which Qd =/= Qs, there will be a tendency for people to deviate from this point, and tends to equilibrium.
b. in game theory, an equilibrium by dominant strategy in a game is the set of strategies choosen by all players such that if the players are in equilibrium, they won't have tendency to deviate.
  That means, equilibrium is somehow a stable point such that there will be no tendency to change. Also, if a point is out of equilibrium, there will be a tendency for people to deviate from that point. In the normal case of supply-demand model, if a point is out of equilibrium, it will tends to the equilibrium IN THEORY, the reasons (or stories) used for this is said by you in #51:
"If the price is below EQ, there will be more goods supplied than demanded.  The supplier will compete to lower the price to get the overstock sold.

If the price is above EQ, there will be less goods supplied than demanded.  The consumer will compete with higher price to get the limited supply."
  And this is the "Stories" I want to say about in point B in #45.
  In this sense, equilibrium could be "stationary" in this sense.
  But of course, the point that equilibrium is stable, and the disequilibrium is not stable is a matter in theory, but not in reality. In theory, people would deviate if it is outside equilibrium, as I just mentioned in this post. On the other hand, in reality, just as I said in some previous posts (like #50, #48...), we could not simply say the market is now "tends" to equilibrium since there are so many factors that could affect the equilibrium price, and we can't hold the "other factors" constant for a sufficient period of time to allow us to conduct some sort of "controlled experiment". I think I don't make this point clear (or even not to mention it at all... sorry^^'') for this distinction between theory and reality.
  Equilibrium is a point in which there is not tendency to change in theory. By this, we are able to make a reasonable "final" point in theory, in each set of given extrageneous variables. And this "final" point is the starting point for us to make economic analysis. It is a "starting point" since the original situtation is delineated by the given set of original extrageneous variables. After that, we would adjust one extrageneous variable, and by the model, we have a new equilibrium "final" point. After that, we would compare the 2 equilibrium points (the original equilibrium point, and the new equilibrium point), to see how the change of an extrageneous variable would affect the endogeneous variables (described in the equilibrium points). That's the "comparative statics approach" I was mentioning. The "statics" means the equilibrium points. And the equilibrium points is stable, given that the extrageneous variables doesn't change. By "comparative", it means that we would compare 2 equilibrium points to get predictions.
  For example, initial equilibrium is: price = 100, quantity = 100. After factor A (an extrageneous variable) changes, the new equilibrium is: price = 110, quantity = 90. By comparing the 2 equilibriums, we would say "if A is changed, price will increase, quantity will fall" (it is an prediction). That's what I want to say about the "bad weather example" for the comparative statics approach.

  For the "God" in Walrasian demand-supply model, it's simply some thought about the this model. In this model, in theory, it is just like some "God-like being" that can determine the price for all buyers and sellers such that Qs=Qd, and everyone would follow this price in equilibrium in theory, in this story. In theory, it is caused by "invisible hands". But this "invisible hands", in theory, seems very funny that it seems like "God" (not Christian God...) in some characteristics:
1. being so able to ask about (or know by some other means) the quantity demanded and quantity supplied of all people, at all price.
2. being so benevolent that it don't get any compensation on his work to know the price to be charged, and to set the price. (In economics, all people are assumed to be selfish, and won't be so benevolent.)
3. being so able to set the price, and everyone have to follow the price.
  That's why I said it is somehow a "God-like being". Don't you think so?^^

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  Well, if the model is exactly the same as fact is quite controversal (a matter of philosophy of science). But if we think the demand-supply model is the same as some markets in this world, it would be strenge for me. It seems to suggest that this "invisible hand", "God-like being" does exists in reality, and can know all people's Qs and Qd at all price level, and be so capable to set a single price, and to force everyone to follow it, and people would not deviate from this price. That's what I want to say in Point 3 in #48.

  Yes, people can't sell the food people don't have. That's why the supply curve have to be considered also with demand curve in the demand-supply model. If the quantity would be decreased by bad weather depends on the shape of demand and supply curves. It would be different cases if the supply curve is vertical, and if the supply curve is upwards sloping. Usually, we would assume a vertical supply curve for argicultural products, and this, quantity would fall by bad weather, and you are right. If I said in #50 is simply a matter of mentioning the possibility in theory of upward sloping supply curve.

  Yes, "If the bad weather do not affect the production, it is not much of an influence". That's why I said it is on argricultural products. The "bad weather" effect is not on all goods, but only for certain kinds of goods that have certain characteristics. That's why we have to make it clear that in which situtations, predictions could apply; and in which situtations, the predictions couldn't.

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  Yes, the real life have so many variable. It is very complex. But if we consider every factor, it would be too complicated for us to analysis. Therefore, we have to make some simplification in different economic models so that we could make predictions. So, we have to make things simple.
  For real life, there are so many factors changing over time, that's what I mean by "we can't have controlled experiments in economics".

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  By the way, it's happy to discuss with you. I can learn a lot in this discussion process. And hopefully, you don't mind of my wordy posts as my language is not so good. ^^

[ 本帖最後由 weakest 於 2008-1-31 04:37 編輯 ]

這男教師當然罪不可赦﹐那個小女生亦大有問題。