Sara Brewer

Econ 1740

Free or Equal Video

E-Portfolio Assignment

1. If the government gives everybody the same freedom to work & reap the rewards, some will do
better than others. The result will be equality of opportunity, but not equality of outcome.

Answer #1: Equality of opportunity

Answer #2: Equality of outcome

2. Immigrants who arrived in the late-1800s/early-1900s found that America was truly a land of
opportunity. Describe the factors these immigrants encountered which helped them thrive.

Factors: The immigrants were eager & expectant, their own talents & hard work made a
difference. There were many rewards for hard work, enterprise & ability. Life was hard
but opportunity was real. There were few rules & regulations. There also were no
licenses, permits & no red tape to restrict them. What they found in America was a Free
Market.

3. What are the factors which led to the rapidly rising standard of life in Hong Kong? (Be Specific)

Hong Kong: In Hong Kong, they had no prospects, no natural resources, & little land that
could be cultivated giving it economic freedom. Hong Kong never introduced the
policies that other governments did: No tariffs, no regulations or government
intervention in the economy. With the complete absence of tariffs, or any other
restrictions on trade is one of the main reasons why Hong Kong has been able to
provide such a rapidly rising standard of life for its people.

4. Explain voluntary association & why it is essential in a free market.

Voluntary Association: Voluntary Association is what we do together of our own free

will. When people buy & sell to each other & none is subject to force or fraud that is
voluntary association. It is also anything that is going on between consenting adults.

5. Explain how the lead pencil & the smart phone are examples of invisible hands.

Invisible Hands: The lead pencil & smart phones are examples of invisible hands
because it takes numerous sources coming together to create each product. Theres not
a single person in the world who could make a lead pencil. The wood, from which a
pencil is made, comes from a tree that was cut down. To cut down the tree it took a
saw, to make the saw it took steel, to make the steel it took iron ore. Same goes for the
 Smart Phone, not a single person could make an entire smart phone. The display is
made in Japan & the camera in Vietnam. The microphones come from Austria & the chip
set from France. The memory is produced in Korea, & the battery in China. The software
& design centers are from all over the world. Thousands of people, on several
continents, cooperated to make these phones. People from different countries,
different cultures; people who had never even met.

6. In 1980, Milton Friedman visited Hong Kong & met Mr. Cheung who made & sold metal
containers. Decades later, Johan Norberg visited Mr. Cheung & found that he still makes metal
containers however; he now produces more things for the tourist trade. This is an example of
what economic concept? Explain its significance.

Economic Concept & Significance: This is an example of Creative Destruction. If we

want to increase our wealth & opportunities; we have to stop doing old things in old
ways, & start doing innovative things in better ways. In other words, we have to be
creative. But when consumers move on to new goods, it can be difficult & painful,
because old factories & old shops close, & people lose their jobs. That is the,
destructive part. & yet, most economists think that creative destruction is necessary
for economic development. All around the globe weve seen a cell phone revolution. It
used to be all landlines, made of copper. But now theyve become less & less important,
especially in the developing world. Today you coordinate business with a cell phone. As
people buy cell phones, they ditch their home phones. Then there is no need for all
those workers who used to connect homes to wires, & repair telephone lines. Leaving
others stuck with an obsolete technology.

7. John Norberg describes how his home country of Sweden taxes heavily & then redistributes
wealth. Describe the benefits & drawbacks that this approach has on the Swedish population.

Benefits: The benefits of the way the Swedish governments approach works, is that
some people are able to get great gains from this. With this way of operation by the
government, it gives a better equality to the people who are at a disadvantage due to
numerous reasons.

Drawbacks: Some of the drawbacks to this are it reduces the rewards for working hard
& taking risks. People are not as motivated to get up & go to work in the mornings,
because they can stay home all day & still collect a check from the government. They
are reaping the rewards from other peoples hard work. The people who do get up & go
to work every day, arent earning up to their full potential because it is evenly
redistributed regardless of how much an individual worked or not.
8. Explain how Free markets regularly turn luxuries into consumer goods.

Consumer Goods: The average rate of ownership for refrigerators, air conditioners, &
dishwashers is high among poor American households today, than they were for all
American households in the early 1970s. When people are free they are able to use
their own recourses most effectively & you will have a great deal of productivity, a great
deal of opportunity. Free market makes it possible for smaller man to turn the luxury
goods into a basic consumer goods.

9. As Milton Friedman said, The society that puts equality before freedom will end up with
neither. The society that puts freedom before equality will end up with a great measure of
both.

Answer #1: End up with neither

Answer #2: Great measure of both

10. Professor Friedman uses the analogy of a race to explain the concepts of Equality of Opportunity
& the Equality of Outcome:

Equality of Outcome in the Classroom: Personally, I would not approve of using the
Equality of Outcome in calculating my final grade. I believe everyone should receive the
letter grade they specifically earn. I choose to work hard in my assignments, & if I
deserve an A, Id like to receive an A. I would not appreciate if my grade were based on
the average of over achievers mixed with slackers, generally if that were the case Id
earn a letter grade in the C range, depending on how the class does.

Pros & Cons: One of the Pros of Equality of Outcome is that it benefits people that get
to start before other people, as it says everyone will finish at the same time it doesnt
specifically include when each person would start. The people who do get a head start
to work on assignments & everything else would come out on top, compared to those
who had to start later into say a semester. In the end, it is evened out therefore
regardless of who started first; everyones letter grade would be equal. A con is that it
would not be fair & not everyone gets an equal chance to succeed.

Equality of Outcome in the Workplace: I do not think I would approve of using the
Equality of Outcome method in calculating my salary either. I work for an amazing
company & even though I am not in the top range of salary, I believe everyone within
my company works hard for the salary they earn. If we were to use this method at my
work sure, it would help me out by raising my salary, but it would not be fair to my
coworkers who earn more based on their job duties, education, performance & skill. I
strongly believe in working each owns way up in a company through hard work &
dedication.
 Pros & Cons: One pro I can think of is that each person will receive a salary to improve
their quality of living, regardless of where their standing is within the company. It helps
employees who are uneducated or have less experience to earn the same as the
employees who do have the education it takes to get the job done. I feel like there are
more cons to the Equality of Outcome in the workplace than pros. To name a few, it is
unfair to those who put in hard work every day within their job. Especially those who
took the time to become educated about their work, they spent a lot of money to get
through school, but their paychecks would not reflect that. Qualified professional will
not earn their full potential of what their qualification deserves. The demand for highly
skilled professionals will decrease, which will most likely cause them to slack as well.

Reflective Writing

By completing this assignment, I feel Ive developed knowledge & skills to be civically engaged.
Prior to watching Free or Equal I had never put much thought into what a free economy was. Learning
how successful Hong Kong has been due to its free economy makes me wonder why other places didnt
change to having a free economy right away as they would have had a better change to be as successful.
Professor Milton Friedmans research really caught my interest; I never would have considered how
many invisible hands goes into each & everything I use in my day to day life. Even while watching the
video I started noticing things around me that also took multiple people from all over to make.

Another SLCC Learning Outcome I achieved would be that I really had to think critically &
creatively while watching this video. By paying close attention to the video so I could answer each
question after. I was sure to put a lot of thought into each question while I was answering it as well. I
actually enjoyed this video & ended up watching it a few times through. I also feel like I learned quite a
bit from the video about things you dont necessarily think about when doing your day to day routines. I
think the main thing that really caught my attention was the work that is put into making objects such as
a pencil or smart phone. It makes you appreciate everything in life a little bit more due to what it takes
to create them.