January 11 thLecture Notes
-Actions are purposive
-Actors have perfect information
-Actors know their preferences and can rank them
when can change from a single individual racking preferences and
making decisions for us. But when a group is know responsible for the
actions, preferences change to accommodate everyone.
-Actors know all possible options, including the consequences of each
-Actors calculated the costs and benefits associated with each option.
When you stop assuming that actors behave rationally, you can make
predictions and prescriptions.
-Critics of mercantilism in the late eighteen century
Started putting taxes, tariffs. Monarch were concerned with raising
money for their militaries, in order to pay soldiers to fight for their country.
People would not voluntarily go to war.
-Adam Smith writes “The Wealth of Nations” formal arguments made by
States that the government is going up taxing people wrong, and the
definition of wealth is wrong. The definition people used was based on
gold and silver. Smith stated that wealth is what your society consumes,
goods and services. It about what you can produce and engage in trade and
this will make your society wealthier. You must people control and choice
over their own lives. Not only economic, but political aspects of
-Britain adopts classical liberal policies in