Remake of Arthur Pigou by Sonia Zhang https://padlet.com/sonia_zhang0012/rbwng580apbn The Great Economist Conference en-us 2017-09-08 05:07:28 UTC 2023-02-19 23:08:54 UTC hello@padlet.com Influences angela_lam https://padlet.com/sonia_zhang0012/rbwng580apbn/wish/185761672 Until this day, many economics still believe that my Pigovian tax is a more efficient way to deal with problems like pollution comparing to the government's solution.
 Many of my students in Cambridge became influential members in the world of Economics based on the ideas of my teacher, Alfred Marshall, and my contribution to the idea of externality. 
I am best known for my book, The Economics of Welfare, published and well studied by economics around the world in the 1920s-1930s. ]]> 2017-09-08 05:07:28 UTC https://padlet.com/sonia_zhang0012/rbwng580apbn/wish/185761672 Major publications angela_lam https://padlet.com/sonia_zhang0012/rbwng580apbn/wish/185761673 In my opinion, my best work was a book that I published in 1920, The Economics of Welfare. In the book I developed Marshall’s concept of externalities, which are the costs benefits conferred on others that are not accounted for by the person who creates these costs or benefits. I argued that negative externalities (costs imposed) should be offset by a tax, while positive externalities should be offset by a subsidy. However, my analysis was criticized by Ronald Coase in 1960. He argued that taxes and subsidies are not necessary if the partners in the transaction—that is, the people affected by the externality and the people who cause it—can bargain over the transaction.]]> 2017-09-08 05:07:28 UTC https://padlet.com/sonia_zhang0012/rbwng580apbn/wish/185761673 Economic View catherine_zhang3 https://padlet.com/sonia_zhang0012/rbwng580apbn/wish/185761674 Pigou Effect:
Every country is going to experience some recession and prosperity, and a variety of decisions could be made in order to maintain the best out of a community. Around 1943, I derived with a special economic effect: Major decline in prices stimulates economy and triggers a wealth effect, which generates full employment. To put this in a simpler way, during a recession, unemployment rate rises. At this stage, if we reduces the major market price, consumers would spend the same amount of money buying more goods, therefore having spare cash available for spending. If we try to think from a psychological perspective, owning spare cash makes people feel wealthier, so they would like to spend more. This increase in demand can eventually lead to a high rate of employment as employers need to produce more products.]]> 2017-09-08 05:07:28 UTC https://padlet.com/sonia_zhang0012/rbwng580apbn/wish/185761674 Economic View catherine_zhang3 https://padlet.com/sonia_zhang0012/rbwng580apbn/wish/185761676 Externality & Pigovian taxes:
I first introduced the concept of externality in the 1920s. It is an idea that surely has to be treated with awareness. In markets, there are multiple "costs" that have to be paid, and two of the major ones are private cost and external cost. Private cost is the cost paid by the consumer or the producer, while external cost is a cost paid by bystanders, people other than the consumer or producers. Us economists often call those bystanders "the third party". Externality, is therefore the external costs or external benefits that affects a party who did not choose to incur that cost or benefit. 
I have simple separated externality into two categories---negative, a bad external cost suffered by the bystanders.  and positive,  a benefit enjoyed by the third party. For example, a company who produces chemicals will create a negative externality for the pollution it causes in the long run. On the other hand, an example of positive externality would be consuming education. One not only get a private benefit, but there are also benefits to the rest of society. 
So it is a responsibility for all of
economists to urge the government to adopt policies that "internalize" an externality in order to limit the impact to parties who choose to incur them.
    It isn't impossible to solve this issue. I suggest that taxes should be applied to market activities that generate negative externalities. By imposing my tax system, a government can create a new "cost" - ideally a cost equal to external cost, and discourages the potentially harmful social activities.
]]> 2017-09-08 05:07:28 UTC https://padlet.com/sonia_zhang0012/rbwng580apbn/wish/185761676 Arthur Pigou sonia_zhang0012 https://padlet.com/sonia_zhang0012/rbwng580apbn/wish/185761677 2017-09-08 05:07:28 UTC https://padlet.com/sonia_zhang0012/rbwng580apbn/wish/185761677 Personal Life sonia_zhang0012 https://padlet.com/sonia_zhang0012/rbwng580apbn/wish/185761678 My name is Arthur Cecil Pigou, an English Economist from a British sea side town named Ryde. I studied at King's College, a student of Alfred Marshall (one of the chief founders of the school of English neoclassical economists). And that is how I am responsible for disseminating many of his ideas. Later in the years, I became a professor of political science in the Cambridge University. I am best known for my book, The Economics of Welfare, published and well studied by economics around the world in the 1920suc-1930s. 

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