ECON 102 Lecture Notes - Lecture 26: Rational Ignorance
17 Dec 2015
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Econ 102 - lecture 25 - public choice (final discussion) Rational ignorance: when a person is ignorant because the cost of gaining additional information would outweigh the benefit. In other words, it"s when the cost of educating yourself about an issue thoroughly enough to make an educated decision outweighs any potential benefit you could expect to gain from that outcome. Reduce the information costs of their members to overcome the problem of rational ignorance. Spend members" money to affect elections or influence politicians. Laws that get passed have concentrated benefits and diffuse costs. Examples are the u. s. chamber of commerce and the national association of. Rent-seeking: using government coercion to seek benefits at the expense of other people. Basically spending funds on lobbying for subsidies to gain wealth that"s already been created or to implement regulations on competitors to increase market share. Key differences between government agencies and private businesses:
