ECON 2540 Lecture Notes - Lecture 20: Friedrich Hayek, Serfdom, Invisible Hand
17 Oct 2015
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Document Summary
Politics-the state: the role that government plays in producing, determining how they are produced, changing he distraction of income. Role that the government plays in the economy, the state is the most powerful actor in the economy, only they have the power of legitimate coercion. Legitimate coercion is the unique power that the state has, the only actor that can legitimately force someone to do something they do not want to do. Compulsory, you have to payoff them whether you want them or not for goods and services, paying taxes. Provision of that good or service is then collective, everyone gets access. Cross subsidization- you will pay for things that you do not want, you are subsidizing someone else"s. Paying for public school, it could be cross-subsidization. But you benefitted from public education, and you benefit from a society with lower crime rates and better economic growth. But not all nations have that luxury, revolution might be the only option.
