The Debate Over Guns Vs. Butter

Politicians and economists have often debated over the most effective allocation of resources for a country, commonly referred to as the guns-and-butter curve.  This curve is defined as a production possibility frontier, where the two variables are domestic and military spending. This shows how spending money in one area comes at the opportunity cost of losing production in the other area.  There are both benefits and costs for spending heavily on either guns (the military) or butter (domestic issues).

Whenever a country spends heavily on the military and lacks spending on domestic issues, although they may be strong enough to both invade other countries and deter foreign invasion, the cost is increased dissatisfaction and instability at home.  A good example of this is the collapse of the Soviet Union during the Cold War.  In order to keep up with Reagan's policy of deficit spending on military buildup, the Soviets invested heavily in the military while experiencing shortages on food, housing, and other basic necessities at home.  America could outcompete the Soviets due to their comparative advantage in production of consumer goods and machinery.  All of this contributed to the dissolution of the Soviet Union.

If a country chooses to structure their economy around producing domestic goods and focuses less on the military, while they may experience high economic growth and satisfaction in peacetime, the country will be at a disadvantage on the onset of war.  However, high investment in production can ensure that one rebounds from the loss of military assets much more quickly.  One example of this is the United States during WW2 after the bombing of Pearl Harbor.  The Japanese hoped that the preemptive strike would cause the US to be dissuaded from war, while in reality the US brought their superior economic power to bear and started greatly outcompeting the Japanese's spending on the navy.  This eventually led to the downfall of the Empire of Japan.

In conclusion, which plan to implement is largely dependent on multiple variables such as peacetime or wartime, location, and the aggressiveness of neighbors.  One notable trend is that while peacetime lasts, heavy investment in domestic issues can lead to greater production of military resources during wartime. 




https://www.investopedia.com/terms/g/gunsandbutter.asp
https://www.u-s-history.com/pages/h1957.html
https://opentextbc.ca/principlesofeconomics/chapter/33-1-absolute-and-comparative-advantage/
https://www.history.navy.mil/research/library/online-reading-room/title-list-alphabetically/b/budget-of-the-us-navy-1794-to-2004.html

The Psychology and Biology Behind Eating

Eating is one of the main necessities we need to survive. Too much or too little can become detrimental to one’s health, which was shown in the “Weight of the Nation” documentary. Some influences of an eating pattern are psychological factors and biological factors like genes. 

The hormone ghrelin is released when it is needed to signal the brain that you are hungry. It is produced when the blood sugar and insulin levels are low and when replenished, another hormone leptin is produced that produces the feeling of being full. It is a natural process to feel hungry and full but when the psychological factors interact with this process it can lead to eating disorders involving too much or too little food intake. 

When eating high sugary and fatty foods, the mesolimbic center of the brain released opioids that bind to receptors. These receptors release dopamine, the hormone that produces happiness. This factor influences the now “need” for sugary fatty foods that people crave during stressful times. Although we may feel the need to eat when those foods are present, it is simply our brain telling us we need it to have an upkeep of dopamine. 

Although economics plays a huge part in the food industry, mental health also seems to play a huge part. Americans are noted to be some of the most stressed people with about 55% of adults reporting stress on a daily basis. When people are stressed they tend to eat high sugar and fatty foods to feel happier. With the increasing prices of living in America, there could be a correlation between obesity and stress in impoverished parts of the country. Perhaps one of the ways to decrease obesity and eating disorders in the United States is to focus on the mental part along with the physical aspect of being healthy.

Sources:

https://www.howitworksdaily.com/the-biology-of-hunger/

https://www.huffpost.com/entry/hunger_b_7168958

https://www.nytimes.com/2019/04/25/us/americans-stressful.html

https://www.apa.org/monitor/2011/01/stressed-america

Round Up

RoundUp by Monsanto is the worlds most widely used herbicide. Since RoundUp was introduced in 1974 it is now used by 160 countries with 1.4 billion pounds being dumped per year. It is used on about every acre of nonorganic corn and soy. Unlike other herbicides, RoundUp contains glyphosate which kills plants by blocking proteins needed for growth. This means RoundUp is actually designed to kill every plant in its path.

The genius behind RoundUp is that Monsanto has genetically modified seeds to be RoundUp ready meaning they are resistant to glyphosate. In turn, RoundUp continues to kill every plant except the RoundUp crop the farmer plants. Additionally, they have made it contractually illegal for farmers to harvest seed from their existing RoundUp plants meaning each year farmers must buy new seeds from Monsanto. As a business model, this is genius farmers can only by the Monsanto seeds because they are the only ones that are resistant and they must keep buying the seeds year after year.

While RoundUp has greatly helped our food production still not much is known about its effects on humans. We know that glyphosate is now found in 70% of rainwater runoff as RoundUp bound to the soil is swept into the atmosphere and recently the UN’s International Agency for Research on Cancer declared that glyphosate is a probable carcinogen.

Currently, a couple who used RoundUp weed killer in their yard for decades is suing the company after they both developed cancer. As the results of the lawsuit are yet to come it will be interesting to see if there is enough scientific precedent to hold Monsanto responsible. The question still remains what are the health effects of low levels of exposure over extended periods of time and are farmers responsible for the negative health effects?

https://www.nationalgeographic.com/news/2015/04/150422-glyphosate-roundup-herbicide-weeds/
https://www.wsj.com/articles/despite-rulings-farmers-remain-loyal-to-roundup-11553175429
https://beta.washingtonpost.com/business/2019/07/19/judge-slash-billion-award-couple-with-cancer-roundup-lawsuit/

Economics vs. Morals

Would you endanger the life of someone for your own economic profit? That is exactly what almost all fast food companies are doing to less fortunate people living across the world. As we saw in the documentary shown in class today and Friday, fast food companies are specifically targeting people living in these less fortunate communities because they know it will make them a greater profit.

Since not all people have the same access to supermarkets or stores that provide healthy foods, such as fruits or vegetables, they then turn to the fatty foods that are provided to them at their local convenience stores and fast-food restaurants. As we saw in the documentary, this leads to obesity, which can cause diabetes, cardiovascular disease, and a poorly functioning liver.

If we have evidence that these types of foods lead to the diseases above, then why are fast food companies continuing to market and restock in these locations? They clearly know that what they are doing is hurting these people, so why do they continue? It all comes down to economics vs. morals. These fast food companies are profiting millions of dollars from people buying their food. But at the same time, they are hurting these peoples lives and futures. If you can, in fact, link deaths from obesity to fast food, these companies are essentially killing millions of people. Now hopefully, these companies do not want to kill all of these people, but they aren't willing to sacrifice their profit to save them either. So where is the line going to be drawn? When will fast food companies start valuing their customers' lives, more than maximizing their profits?

Psychology in Economics

THE LINK BETWEEN ECONOMICS AND PSYCHOLOGY

There is an interesting connection between the field of Economics and the field of Psychology. Both involve the studying of human beings, specifically their behavior. Since our economy is fueled by the decisions made by the people that consist of it, it can be useful for economists to have some general knowledge that allows them to deduce what lies behind an individual's actions and/or thinking. This can be of great use since it gives you a better understanding of what motivates or incentivizes people to do the things that they do, including, for example, how an economy might react to certain changes. 

The documentary that we watched in class (Can You Bribe a 9th Grader to be Successful), offered results that showed very minimal improvement in grades. As discussed, since you can’t just attribute this discrepancy to the financial bribe, you also have to consider that there may have been something else that prevented the students from getting and maintaining the desired grades. It could have to do with a diagnosed or undiagnosed learning disability, their home environment, their personality type, and/or their IQ level, etc. Understanding how this experiment may have been affected by other circumstances in these students' lives can really help the researchers determine how much they can contribute the poor results to the ineffectiveness of the bribe or other external variables.

Specifically, Microeconomics focuses on the behavior and effects of individual decisions, and the various interactions amongst them. Psychology encompasses this same branch of thinking, making it incredibly beneficial for economists to have some general knowledge in this field. Knowing and understanding the brain structure and framework behind individuals’ thinking can make economists’ jobs much easier. In a way, it can be the difference between making an accurate or inaccurate economical decision/prediction.

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