Lecture 1 Ethics
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| The Baby Market P/B → everything should be allocated to the market. Fact: can take up to 8 years to adopt Judgement of the fact: many feel wait time is too long, and that the current process is not working effectively and needs to be fixed. Analysis: How the economist (PB) would understand the problem and what kind of solution they would propose. Having to wait 8 years to adopt indicates demand exceeds supply, implying the price for babies is too low. If the price were higher, demand would drop, supply would increase, and thus wait times would shorten. Supply of babies has dropped [supply shifted to the left Why? →, because • contraception fewer babies are being put up for adoption as more people use contraception • changed social norms stigma attached to unwed mothers have changed • abortion legality, affordability and availability Result → at any given price, fewer babies are available today for adoption now. Demand has increased Why → # of Canadians have increased as the population grows, demand grows with it. Result → at any given price, more babies are sought for adoption now Demand is up and price is down. And if the price of babies is fixed, this would explain why wait times have become problematic. What is the value of a baby to an economist, the price it sells at. What is the price of a baby the price of babies is determined by the fees that adoption agencies charge Who determines adoption fees in Canada, provincial government regulates adoption fees therefore, the price is fixed. How does the gov set adoption fees fees are set to recover some of their costs New fact: approx. 30,000 children waiting to be adopted If 30,000 sitting in inventory, how can D>S. All babies are not considered equally desirable. Babies are desirable based on attributes • abled (mentally and physically) • of Christian parentage • healthy • infant • white The fewer of these attributes they possess, the less sought after they are by potential parents. Demand and supply in regard to undesired babies • Fewer desired babies in supply • More demand for desired babies Desired babies are in backorder (greater demand, lower supply surplus inventory of undesired babies (lower demand greater supply) The government shouldn’t be regulating the fees (price) associated with adoption. For the market to clear, babies need to be priced differently. Desired babies should sell at a premium undesired babies should sell at a discount. There should be a market for babies that operates openly and freely, and the problems of adoption will be solved. Q: what does it mean to say that if the price were set higher, demand for desirable would decrease ➔ People will start adopting less desirable (cheaper babies) Q what does it mean to say that if the price were set higher, supply of desirable babies would increase ➔ Women entering the market as surrogates for the purpose of making $. Download 0.65 Mb. Share with your friends:
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