Econ Class Notes 8/28
- Scarcity - limited resources, unlimited wants. Everyone would like to allocate
resources the way they see ﬁt. If I were in charge, I’d have a bigger ofﬁce, ofﬁce help,
reception for my students, etc...
- Limited resources, I mean productive resources- things used to make stuff. Only so
much stuff to go around. With these limitations, each person would prefer that these
resources be allocated in a way that makes him/her best off. your preferences come in
conﬂict with mine, and the person next door.
- scarce goods - If good Z is a scarce good for you, you are willing to give up something
else of value in exchange for more of good X (need not be money). Do you want more
than is freely available? If so, then that good is scarce for you. Although trash and
pollution aren’t scarce; they aren’t goods in a productive sense. Economists call these
“bads”, and talk of pollution reduction and trash removal as “goods”. These are