Income
Treating equals unequally or treating unequals equally.
Discrimination
When I can sit in the parking lot across the street and watch fireworks paid for by the mall
Free rider problem
The cost borne by the producer of a good or service.
Private cost
Private costs + External costs
Social Costs
Another name for interlocking directorates
Trust
Level of income that would be need to pay for a minimal diet
Poverty Line
Selling at an unreasonably low price to drive out competition
Predatory Pricing
The economically optimal amount of pollution
Marginal benefit = Marginal cost
I will only sell you this if you agree not to buy from my competition
Exclusive Dealing
When a third party has to bear part of the burden of the costs or receives part of the benefits
Externality or spillover
Requirement that a family’s income not exceed a certain level to be eligible for public assistance
Means Test
Existence of monopoly alone is not illegal unless the monopoly engages in illegal business practices
Rule of Reason
When a third party has to bear the burden of someone else's actions, the third party charges too ______ and produces too ________.
Charges too much
Produces too little
Recipients must perform some work activities within two years of receiving welfare or risk losing benefits
Workfare
Current level of the international poverty line
$2.15 per person per day
Compares the cumulative percentage of families earning a cumulative percentage of income to perfect equality.
Lorenz Curve
Merger of a firm with its suppliers
Vertical merger
The overuse of a resource until the resource is exhausted
Tragedy of the Commons
Merger between firms in unrelated markets.
Conglomerate
Plan under which families below a certain break-even level of income would receive cash payments that decrease as their incomes increases.
Negative Income Tax
Employees who work for the same employer must be paid the same wages when their jobs, even if different, require similar levels of education, training, experience, and responsibility
Comparable worth
Requiring buyers who want part A to also buy part B
Tying contracts
Environmental policy to set an amount and punish firms if they pollute too much
Command and control
The existence of monopoly alone is illegal, regardless of whether or not the monopoly engages in illegal business practices
Per se
The private sector can get to socially desirable amount with little or no government intervention
Coase Theorem