Bad economics

First serious post in 5892493 years, apparently inspired by thinking too much about pointless issues.

Anywhere here’s an attempt into treading the waters of behavioural econs with something uniquely uh, Singapore. Because I think i’ve forgotten much fanciful concepts/theories and lack empirical evidences, this is clearly uneconomic and not the way you should answer your H2 essay qn, or write a rigourous paper, or try to look smart, but nonetheless, some introspection on steroids.

THE CONTEXT: $100 entrance fees into the casino

Contrary to the popular (neoclassical and logically Singaporean) belief that setting a ($100) cost to any illicit/vice activities would intuitively decrease the incidence of vice, addiction is probably a uniquely difficult variable to model into cost-benefit analysis and shouldn’t be analysed with standard demand/supply frameworks.

1) The entrance fee only reinforces the need to gamble, not curb it. No rational (or irrational, depends on what you define as rational) football team concedes defeat if given a (hypothetical) 2-point handicap against another team even before kick off. They just fight harder throughout the whole game, right?

2) The (official) rationale of a fee is to “discourage potential gamblers” or whatever – not interested to quote verbatim. Which clearly fails when you consider the magnitude at which ‘problem gamblers’ gamble with; $100 is just another cost. (The standard layman argument, all of which can be found on brainless forums, so shan’t elaborate.)

3) So, premise 1) and 2) just illustrate a higher fixed cost for ‘problem gamblers’ which only results in greater volume of gambling to cover losses, since exhilaration feeds addiction. In fact, it’s a SNOWBALL effect starting with the initial $100 loss.

4) This is a purely counterproductive policy. The people to be protected from themselves through this policy are actually coerced to crash and burn – welfare loss. And this is not even considering the welfare loss by normal, curious citizens who are inclined to explore the casino, but are otherwise not inclined to.

5) Bad economics in action, or could it just be GOOD PROFITEERING?

On second thought, econs papers looks drastically nonsensical with esoteric English. Layman talk does quite fine in fact. Maybe topped with some appropriate math and empirical research would make it just suitable?

Then again, what use are they?

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