Understanding Economics

Lesson 5: The Dog in the Manger

Please read chapters 22 - 23, The Dog in the Manger
and A Closer Look at the Law of Rent.

1. As population grows and material progress advances, why is some land held out of use?           | Text | Supplement |

2. In a growing economy, why does rent always take an increasing portion of the wealth produced?           | Supplement |

3. Unlike speculation in land, speculation in commodities           | Text | Supplement |

a. benefits consumers.
b. leads to overproduction and bloated inventories.
c. contributes to market panics.
d. is subsidized by the government.
4. Unlike speculation in commodities, speculation in land           | Text | Supplement |

a. leads to optimal use of resources.
b. decreases wages and interest.
c. contributes to trade deficits.
d. has little economic effect.
5. How does withholding land from use affect the margin of production?           | Text |

6. Need land be held from use completely to lower the margin? Offer an example.           | Supplement |

7. What is the effect of land speculation on the production of wealth?           | Text | Supplement |

8. What are some environmental effects of land speculation?           | Supplement |

9. What are some social effects of land speculation?           | Supplement |

10. How does land speculation decrease the efficiency of public spending on infrastructure?           | Supplement |

11. Land speculation           | Supplement |

a. Leads to a general shortage of capital goods.
b. Assures that sites will be used when their potential is greatest.
c. Tends to decrease the productive turnover of capital.
d. Affects a relatively small portion of the economy.
e. None of the above.
12. In a modern economy, no free land is available. Therefore           | Supplement |

a. the Laws of Distribution have been superseded by modern economic policies.
b. only a revolution can solve the problem of poverty.
c. Henry George's analysis must be revised to account for today's conditions.
d. distribution cannot be explained in terms of natural law.
e. competition drives wages and interest to the lowest levels that labor and capital will accept.
f. None of the above.