Exam 1: Economics and Institutions: a Shift of Emphasis

Though different, Japanese and U.S. compensation systems serve the same purpose, which is

One concern about using real-world data to estimate key parameters of economic models is that the data is collected by agencies that are

Because other societies faced with the same problems have found different solutions, clearly some institutional arrangements are arbitrary.

Microeconomics asks how individuals create a set of economic institutions to maximize their self-interest.

What problems are solved by the institution of a state?

If Mark Kimura develops an economic theory, but cannot observe the predicted behavior during lab experiments, he should

The best measure of how good an economic theory is how

When Brenda takes out a mortgage and does not know if her house's price will go up or down, she faces

Laura Ramos developed an economic theory and tested it in a lab experiment. The lab data did not match the behavior predicted by her theory. Laura should rethink the validity of her theory.

An economics classroom has a very happy student. Every compliment from the professor makes this student exquisitely happy. There is also a morose student who rejects every compliment. What economic principle could the professor use to allocate compliments between these two students?

Property rights enhance the efficiency of economic activities by giving people the appropriate incentives to manage what would otherwise be common resources.

Which question is least important to institutional microeconomists?

Which of the following is an institutional process that a family could use to make allocation decisions?

One type of institution is

The study of games of strategy and the strategic interactions that such games reveal is known as game theory.

Decisions that are typically made at one pont in time are

The positive question of modern institutional economics is why we have the current set of institutions.

The optimal way for Santa Claus to allocate presents to children depends on the incremental happiness that each dollar allocated to a child brings.

Economic models are abstract representations of reality that economists use to study economic and social phenomena.

In economics, a free ride is