Eco/372 Week 1

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Assignment – Week 1

It is clear that the economic policy in general and the monetary policy in particular should be concerned with the overall economic well-being. In this paper we propose to discuss this core topic. We will provide an overall picture of the functioning mechanism. In this regard, the discussion will develop around the governmental policies and of FED, and their scope on the free market. The argumentation will refer to the notion of common good and will try to establish if the measures applied by FED have fulfilled their intended purpose given the recent international financial crises of 2007.
The orientation of the policies to a general well-being is connected to the fact that the government and the central bank from a …show more content…

However, this policy is sustainable only on short run, because it generates inflation (Anderson et al., 2010, p. 502).
A common good is defined by the fact that it is beneficial for a whole society, not just for a certain individual, as in the case of private propriety (Lee, 2015). The common good is based on the belief that certain goods (as security) can be obtained only collectively and through political means. If in a society formed of a multitude of individuals we would have only private propriety, in time the economic power would concentrate in the hands of a few and the life of the many would be unbearable. Let’s just think to a poor individual which would not have the power to buy for itself a propriety, or would not even be capable to move freely in the world because the freedom of movement would imply that he has to pay taxes when crossing the proprieties of others.
In principle the common goods emerge because of the market failures. The problems which occur sometimes in individually administrating the private propriety determined their apparition. For example, farmers who raised cattle on their properties realized rather quickly the advantages of common pastures. In the same way there are a multitude of historical examples of how individuals associated into state entities to obtain security for them and their

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