Exam 6: The Economics of Political Action

With a strong and active federal government, why do we need state and local governments?

Suppose domestic automobiles were allocated in the United States the way public education is allocated. Describe how this system might work.

Which of the following explains why pork-barrel spending is often approved, even when the spending is inefficient?

Which of the following explains why managers of government agencies have little incentive to achieve operational efficiency?

The park in Hammerhead, Florida, built to honor the city's founding father, General Hammerhead, is starting to deteriorate. It would take about $5,000 to restore the General's statue, repair the benches, and repair the fountain, but the city budget is tight. Also, the deterioration is not that noticeable. Mayor Grouper suggests delaying the repair until after the election, three years away. City Councilwoman Halibut notes that by then the park will be dilapidated, and repairs will cost $25,000. From a public choice perspective, what is the likely outcome of this debate?

In the case of a private good, which of the following forms of economic organization will result in the strongest incentive for consumers and producers to economize?

A survey of income by county revealed that four of the five wealthiest counties were located in the suburbs surrounding Washington, D.C. Why?

Which one of the following economists has played a central role in the development of the "economics of collective decision making," better known as public choice analysis?

People who spend more time and effort investigating the advantages and disadvantages of different automobile models when they go to purchase one than they do investigating the strengths and weaknesses of presidential candidates are saying, in effect, that

Current tax rates are insufficient to finance the benefits promised by both the Social Security and Medicare programs. Are these unfunded promises surprising according to economic theory?

Legislation that offers immediate and easily recognized benefits, at the expense of costs that are observable only in the distant future, is often enacted, even when economic inefficiency results. In economics this is referred to as the

Economists refer to the lack of incentive that voters have to search for and obtain information to help make better political choices as the

Public choice theory assumes voters, politicians, and other individuals in the public sector are largely motivated by

When resources are allocated politically, rent-seeking will

A special-interest issue is one that

As government becomes more involved in providing favors to some businesses and sectors of the economy at the expense of others

Use the figure below to answer the following question(s). Figure 6-1 Figure 6-1 illustrates the four possibilities of the distribution of costs and benefits among voters for a government project. Programs that give subsidies to a small group of producers at general taxpayer expense would be considered

A politician may be considered an entrepreneur in the sense that

Most voters will likely be concerned with

Which of the following is true?