Discussion Post #1An important lesson from Chapter 5 is that the way in which a policy is...

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Discussion Post #1An important lesson from Chapter 5 is that the way in which a policy is implemented can have important effects on how benefits and costs are distributed across the population.  In the chapter, one example along these lines was the difference between a project that provides previously stockpiled gasoline versus gasoline coupons.  A more realistic example can be seen across the world every day: humanitarian assistance.  In particular, food aid is often given out by international organizations in areas where populations displaced by war or natural disaster have ended up.  The way in which aid is delivered has important implications for its impacts on local populations.Consider the local market for food. This is a setting where most of the supply is local (i.e., transportation costs are high enough to prevent food from other regions from easily flowing in at low cost).Scenario #1: Food aid is flown in from the United States to the refugee camp and given out as rations.Describe what would happen to consumer and producer surplus in the local food market in scenario #1.

Pallavi · Accepted Answer

Discussion Post #1
There is no doubt in the fact that the manner in which a policy is implemented has significant impact on the benefits that are availed and the costs that are borne by the population of the particular region where the policy is being implemented. Humanitarian assistance in the form of food aid is the greatest assistance which is made to refugee camps. However, even though these policies and assistance programmes are initiated with the intention of providing relief to the affected population, these policies often have many negative micro-level and macro-level impacts on the economy of the local area.

Discussion Post #1 An important lesson from Chapter 5 is that the way in which a policy is implemented can have important effects on how benefits and costs are distributed across the population. In...

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