Puzzles and Paradoxes in Economics

Economics is full of puzzles and paradoxes that often frustrate and challenge everyone, including economists. This engaging book includes fifty puzzles and focuses on three types of paradox. First, everyday observations that appear to belie common sense (such as, why do some supermarket items sell for more per ounce in larger sizes?). Secondly, those paradoxes which have perplexed economists in the past but have since been fairly resolved (such as, the diamond-water paradox). Finally, empirical or conceptual anomalies that remain unresolved and present a challenge to today's economists (such as the voting paradox).Fifty puzzles and paradoxes are analysed in a clear framework. Examples include: the fairness of market wages, the alleged gold absurdity, Giffin goods and the Irish potato famine, the paradox of thrift, the supposed perversity of Wall Street, the leisure paradox, why the best Washington apples are shipped out of state (the Alchian-Allen theorem), the question of whether teachers are underpaid, whether studying economics makes people immoral and whether war is good for the economy. This original and unusual book will have a wide appeal, ranging from the lay person with an interest in everyday economic puzzles, to the student and teacher wishing to develop their understanding of some of the paradoxes that have existed and continue to exist in economics. It will serve as an ideal source for teachers who want to challenge their students with unusual economic problems.

Table of Contents:
• Contents: Preface Introduction Cases and Concepts 1. The Adam Smith paradox 2. The diamond-water paradox 3. The water problem 4. The case of the fourth egg 5.Profiting from pants 6. The price of quality 7. The rationality and risk puzzle 8. Gold’s backward wupply curve 9. The positive sloping demand curve? 10. The leisure paradox 11. The price discrimination dilemma 12. A hot vacation spot 13. The rare case of a Giffen good? 14. The case of the costly catsup 15. The mail order question 16. The businessman’s query 17. Are teachers underpaid? 18. The pollution puzzle 19. Are market wages fair? 20. The highly valued occupation nobody wants 21. The stock market puzzler 22. Apples and the Alchian–Allen theorem 23. The perfect-market puzzle 24. The starvation of Buridan’s ass 25. Does studying economics make one immoral? 26. The savers’ dilemma 27. Keynes’s banana plantation 28. Producing cars that don’t sell 29. The feckless forecast and policy purveyor puzzle 30. The growing but declining gap puzzle 31. The perpetual poverty puzzle 32. The paradox of thrift 33. The gold absurdity 34. The wager over wages 35. The voting behaviour puzzle 36. The voting paradox 37. A taxing debate 38.The blessings of destruction 39. The interest rate dilemma 40. The population puzzler 41. The efficiency versus equality puzzle 42. The national debt: asset or liability? 43. The Leontief paradox 44. The perversity of Wall Street Index