Module 10: Summary

We have reviewed five important topics currently being discussed in the media, some of which are related: food safety and GM food, for example. Each of these issues can be examined through an economic lens meaning we can estimate costs and benefits, whether market failure occurs and how to solve such problems, how consumers and producers are affected, etc. If we wanted to get into great detail we could determine the degree to which prices and quantity change in response to shocks in the markets by using price and income elasticity, as well as cross-price elasticity.

As we discussed at the outset of this class, we use economics to help us make better decisions at the margin. But our decisions also must take into consideration other values such as social and environmental sustainability. When we consider the latter two types of sustainability we must think about social costs and benefits, and possible externalities that occur as a result of private production.

Finally, there are always two sides to every story. While economic analysis can often help us determine objectively what costs and benefits are, and who are the winners and losers, there is always debate about how we estimate the size of shocks, the extent to which they will affect producers and consumers, and the probability of events. This means that we must carefully look at both sides of each issue to see clearly the whole picture.