7. At the end of the 17th century, England instituted a tax based on the number of windows a person had. Parliament wanted to force those who were wealthier to pay more, but did not have any way to enforce an income tax of the sort we have. At the time, however, windows were a luxury item, so there was a high correlation between wealth and the number of windows a person had. Hence, Parliament taxed windows. What unintended consequence resulted from this tax? (Hint: How could the wealthy avoid the tax?)
8. Critics of drivers' education programs claim that the programs do not reduce the number of accidents that teenagers are involved in. How could this program make teenagers safer drivers and yet increase accidents? (Comment: Once you see the logic here, you will be able to see that a great many other situations are similar. Will making cars more fuel-efficient reduce the amount of gasoline used? Will encouraging high school students to use condoms reduce the number of teenagers becoming pregnant? Will making cars safer reduce the number of injuries and deaths from traffic accidents? After a tragic death in a national park that was the result of two campers getting lost, the parents of one proposed that all people going into the wilderness be equipped with cell phones. Can you be sure that giving out cell phones to people going out into the wilderness would reduce problems? Could it increase them?)
(Hint: if you cannot see the logic in any of the above examples, consider this one. Many of the fiercest critics of smoking strongly oppose any attempt to develop a safer cigarette. Why would they take this position?)
9. Some European countries have laws that make it very difficult for employers to fire employees. Economist wonder if these laws help employees or harm them. How could passing laws to protect employees from being fired harm employees? (Hint: People respond to incentives. How do these laws affect the incentives facing employers? If you were hiring, what would you do different if there were laws making it difficult to fire rather than laws that made it easy to fire?)
10. A key number for demographers (those who study population) is the fertility rate, or the average number of children women have. A little searching on the Internet should give you the fertility rates of all the countries in the world. Find the fertility rate for Japan.
a) If we have 1000 people of childbearing age (500 women and 500 men), how many children would these people produce using Japan's fertility rate? (With a fertility rate of 4, they would produce 2000 children, with a fertility rate of 2, they would produce 1000 children, and with a fertility rate 1, they would produce 500 children. Do you see why?)
b) If the children of the original 1000 people have the same fertility rate, how many grandchildren will the 1000 original people have?
c) If the grandchildren have the same fertility rate, how many great grandchildren will there be?
d) Does Japan face a Malthusian future? Look at the fertility rates of the European countries. Do any of them have to worry about a Malthusian future?