The Traditional Sytem

Recently, I have learned about the four economic systems, one of which is the traditional system. The traditional system uses a system of passed down techniques in or order to accomplish their own economic growth. However, this particular system often leads to a stagnant economy. On the other hand, a traditional economy is the original economy from any part of the world. In other words, no country began with a developed economic system. That being said, most countries today with this traditional system have underdeveloped economies. Upon learning about this economic system I became curious if their still remained any purely traditional economic systems. Any traditional system today would most likely focus on agricultural. However, even the small underdeveloped countries are transforming their economies to keep up with the modern changes of society. Although this is true, the idea of a traditional economic system is not extinct. Many indigenous countries such as, Papa New Guinea, Brazil, and other African and Asian countries still practice traditional concepts. Traditional values remain prevalent in these countries, with the understanding that in order to survive they must use some of their production as a mean of commercial use.
But why would these countries still practice these ideas if they are proven less efficient than other economic systems? A traditional economic system has some valuable benefits that can only be achieve by the social nature this type of economy creates. Traditional systems require a group effort among the people. Thus, this system unifies them and nurtures their beliefs and cultures. Unfortunately, in order to survive, the main principle of the traditional system, each person has a set job to perform to keep society running. With less governmental control there is more freedom of thought, so why do the people continue performing the same jobs the same way without question. In my opinion, it’s because they value their cultural practices more than they do an advanced economy and they lack the resources need to make an economy thrive. Though they aren’t the wealthiest of nations, a society with this system can enjoy certain independence without feeling a financial strain.

Obama Rejects Pipeline

Last week Obama rejected the idea of the Keystone Pipeline, which transported oil from Canada to the US. This is hard to understand, considering the pros and cons. Canada has a huge abundance of oil sand reserves and they are wanting to build a pipeline to the US to sell to us. Being in AP environmental science, we have studied different ways of extracting oil, and oil sands are a lot less environmentally detrimental compared to the other possibilities, such as deep sea drilling- which a lot of our oil comes from! It does have its negative impacts however, mostly taking away from the natural beauty by digging up large areas. But the real deal is that if we dont buy it, someone else will. There is a growing demand in energy resources as technology is ruling the world. It is expected that if the US does not buy the oil, that Canada will make an agreement to build a pipeline to China. The only reasons that i have heard about Obama rejecting it is the negative environmental impact. So if thats the only con, let me tell you all the pro’s -- it will help the economy, increase job opportunities, lower oil prices and decrease dependency on the Middle East. Also, if the US wont buy the oil from Canada, TransCanada Corp. says that they will sell it to other countries instead. Therefore rejecting the building of the pipeline to the US will not help the environment; it is inevitable that Canada will sell it to someone else. Along with all of this said, many believe that Obama has only rejected the pipeline for the time being so he doesn’t have to make any big political decisions with the chance that he might loose votes in the upcoming election. As far as I can see, the only ones that would be against this would be radical environmentalists, who usually lean towards a more liberal standpoint. But I think more people would want to see this getting built than not, so I think he would actually gain support, especially considering how rising gas prices will only get worse as the weather warms up and people begin to travel. So are their any other reasons not to build this pipeline that I am missing? And do you think Obama will go back and end up approving it if he is reelected?

Rangers Big Gamble

Texas is known for several things, one of them is being home to the Rangers. The Texas Rangers have been the ALCS( American League Championship Series) winner for the past two consecutive years, this leaves fans with high expectations. The owners and managers recognized this and realized that it was crucial to keep their line-up stacked and record filled with W's. They decided that one of the keys to these two goals lived across the globe and was an icon in his country, it was Yu Darvish. Yu Darvish is considered the top pitcher in Japan, at 6ft.5in. and 215 lb., he's not doing too badly for being 25 years old. Rangers managers decided they not only wanted Darvish, they would do whatever was necessary to have him. They settled on a $60 million six year contract. Now the question is , Will he meet expectations? The Rangers have a solid batting line up as well as defense, the only area debatable is pitching. Darvish is expected to be a key element in it's build up after what some consider a huge loss by losing Wilson.

There are many odds against Darvish being successful. He is away from his homeland, dealing with completely new ranges of temperatures, and pitching against a whole new group of players. All three factors could be reasons for his failure, but as a Ranger fan, I am hoping it is all handled easily and Darvish will be a great success while on our team. If not, the Rangers will have suffered a huge opportunity cost which will follow them the next six years.

Finding Value in Higher Education & Marriage

An interesting article on the premiums earned for post-grads and married men highlighted how economists are encouraging men to pursue a degree to increase their income versus their zipped lips on the bonuses that come with marriage and a comparable premium return. Mr. Caplan proceeds to list several possible, semi-thought out reasons possibly explaining how this could possibly happen, using the "you could think" starter to hide behind the fact that his reasons are mediocre. Still, to give Caplan some credibility, he at least takes the time to present counterarguments to the arguments he himself developed. They range from a man's distaste for marriage to the lack of freedom that comes with eternal union.

I am uncertain if there is a positive correlation between marriage and age, yet there is most likely a positive relationship between salary and age. Employers desire experience, and seniority in the workplace more likely than not secures the employee higher wages. That's not to say, however, that all elderly job-seekers are guaranteed work. Caplan brought to light an interesting "discrepancy" that may be explained by means other than economists have established a "double standard." For one thing, there may be a large proportion of single, white males that believe marriage would lead to children. The thought of having kids intimidates the college-grads or high income hopefuls from settling down until they themselves have a steady/larger salary. From another perspective, being married with kids could act as motivation for the male to work harder and secure a better job to provide for his family. A wife may act the same way.

While the statistics lead one to believe that marriage may lead to a higher premium, speculation of divorce, along with alimony, is certainly not encouraging. Also, marriages may be a direct result of a man's income. There is a higher correlation of marriages for men with higher incomes than those who merely "get by." The 44% premium with marriages may be an after-effect to an up-and-coming mate's promotion or line of work.

These points are all speculation, however.

Financing a Higher Education in a Struggling Economy

Prospective and current college students face the dilemma of how to pay for their education because of the decline in the economy. Many college students in fact believe the US economy is doing poorly or is “on the wrong track.” A major concern of many of these students is finding a job after they graduate. These students as well as future students want to see the job situation in the US improve so that they can feel secure. Without such improvement, students will have to accept low paying jobs with no benefits. In addition to their own financial burdens, these students can no longer turn to their parents as much as they use to because their parents are struggling to find work too. However, this does not necessarily mean that students want the government to give them more money, but rather have a deficit reduction in order to help the economy. Some students on the other hand, feel that by the time they graduate there will be available jobs, but they still believe the economy will continue to face big issues even after some are resolved. Basically even though students feel they have future job security they still feel their economy will continue to struggle. Thus, many college students feel the extra money they put into their education will pay off in the long run. As a future college student I am facing this same dilemma as I choose which college to attend considering the economic struggles. Would it be more advantageous to attend a college that cost more but offers a better education than a more affordable school?

Command System

When reading on economic commands systems I realized how detrimental they could be to an economy. I first believed that if the government ran the entire operation, that our country would be stable, with a constant exploitation of rescources. After reading more into the system, I realized that the government would have all power and the people would basically be under control having no working freedom. Each individual would be working for a designated amount that was issued to them by the government. This would become controversial now because each individual person would not have any incentive to finish their own work. Each persons success would depend on others to fullfill their duties as well. This made me realize that the Command system and the Market system are actually polar opposites. The Command system has an absence of private property while there is private property in a market system. I realized that it would take a very strategically planned and developed Command system for the nation to actually succeed and flourish. This made myself question why any nation would convert to this type of economic society when your sole purpose in work is to please the political figure.

Colombia's Production Possibilities

Colombia produces 10% of the worlds coffee, making it the 2nd largest coffee producer in the world (beneath Brazil). If you try to imagine how much coffee is consumed by the average person everyday, you will realize how important coffee production really is to the Colombian economy. Keeping this in mind, Colombia also produces 90% of the worlds cocaine. The Colombian coffee industry is at risk because the opportunity costs of production are increasing. Rising temperatures, unpredictable rainfall and the intensive labor that goes along with producing coffee is making it more and more undesirable to farmers. As a result, farmers have begun to abandon coffee and take on the coca plant, which produces cocaine. The popularity of cocaine production is increasing because of the multi-billion dollar cocaine trade between South America up towards Mexico into the United States. Poverty stricken families have either added coca plants to their coffee farms, or switched over to coca all together. As the popularity of cocaine production in Colombia has increased within the years, the US has given money and supplies to destroy coca crops and aid the government in reducing production. The UN has also invested in coffee to reduce the drug trade. Though these factors might stunt the amount produced, coca will continue to be farmed in Columbia because of money that is entailed. Though coffee is and will continue to be the more popular crop, production continues to be shared with the coca plant. This is sad to see knowing that the out-of-control drug trade is inevitable and there will always be a demand for cocaine. Maybe if other countries continue to help, technology can aid in making coffee farming more efficient to increase production. So pick your stimulant- cocaine or coffee?