Mankiw\'s Ten Principles of Economics Can Be

¶ … Mankiw's ten principles of economics can be applied. The essay also discusses how I plan to use my knowledge of economic principles in making future economic decisions.

Mankiw discusses how people face trade-offs when making decisions and how this affects our behavior as individuals, as families and as societies. I faced decisions involving trade-offs when I considered moving to another city. The trade-offs involved staying in a city where I was comfortable vs. moving to somewhere that offered more jobs that would be better paid. When I looked at the cost of moving, I had to consider the financial and non-financial costs of moving and I had to weigh them against the potential benefits.

My choice about moving was definitely made at the margin. I had to decide whether the additional income I could make by working in another city where jobs were more plentiful would be offset by the higher cost of living. That is, whether the marginal change was worth the marginal cost.

Any type of job search or decision is largely based on incentives that a new job offers. Evaluating a job involves looking at both financial incentives, such as salary and benefits, but also considering non-financial factors, such as the hours to be worked, the amount of travel, and the amount of stress the job produces.

Mankiw's observations that trade can make everyone better off and that a market economy is the best way to allocate resources also apply to my job search. Because I am not ready to be self-employed, I am better off to trade my services to an employer in exchange for a paycheck. As has been seen, the employment market gives documented examples of market failure wherein government intervention has been required to promote equality and efficiency in fair employment practices.