Freak Economics Essay Example

earn the heart of the profit. The demand for drug supply from the society increases with the supply of drugs from the sources.

As the price of drugs decreases appropriated to lots of street gangs around, the demand from the community increases consequently more sales are made and maximum revenue is made because people can meet the expense of it. Levitt and Dubner compares the executive formation of the gang to franchise company McDonalds, in which relatively few supervisors and managers make money from the manual labor of thousands of small income workers. America has been a capitalist state from rigin.

The state promotes capitalism all over the world. "In the 18th century, after the Industrial Revolution in England and other European countries, the importance of capital as a means of production increased and this resulted into the origin of a new economic system" (3) called Capitalism. The merits of the capitalist mode include rich variety of goods and services, proper use of resources, private ownership, efficient production, raise standard of living, economic freedom and growth of entrepreneurship.

The economic quarrels for drug legalization says, permit drugs nd make tax revenue. Any reduction in the price of drug control because of lower law enforcement expenses will be counterbalanced by much higher costs on public health due to the pitch of drug use. The transaction of the illegal drugs constructs an incursion of dollars that is outside the official economy, and keeps stress on the currency exchange making the dollar low and making the export of legal products turtner complicated.

The drug dealers nave less economic incentives to participate in risky and low paid work but

they believe that one day in the future, they would reach he top position on the gang which keeps them on this kind of business.

The demerits of the capitalist society include asymmetrical distribution of profit earned, status struggle, labour exploitation, lack of organization, business fluctuation and wasteful struggle. This link proved to be principally appropriate when the authors found that most street dealers made a lesser amount of than minimum wage, while also keeping in mind of the danger of death.

Normally, a business desires a new production technique because they experience out of the market, as though they are n lose of money already and they want to avoid increasing the value. Cocaine was expensive therefore cheap form of cocaine known as crack was invented.

. This invention comprised an important technological transform in the supply of cocaine. The market seemed content with the price which meant people obtained crack at a lower price and demand quickly increased.

Cheap production would theoretically consent to the price of the product to drop.

However, most would assume that the invention actually has a cost to purchase. In an event, one would encounter the company powerless measure to shell out for the invention upfront. For example, if a construction engine allowed the company to dismiss 60% of its labour, but their salary which the company would now have to keep, didn't cover the cost of the construction engine.