Decisions are made about more or less; not all or nothing.
ex: Cassy "so-so" is unselfish. Rizzo is selfish -->compare against avg person? What about in Denmark where mothers leave children to wait outside? Selfish has little meaning
-->Must implicitly understand what the margin is
-Also, articulate constraints (Ex: Santa comes once a year, Bruce waits a year or two to release album)

-Teachers make a fraction of professional athletes' pay=> don't we value education more than sports?
-"Use vs. Exchange"

• margin similar to water-diamond paradox
• relative scarcity of teachers to athletes
• imagine removing 200 teachers vs. removing 200 NBA players
• Given amnt of teachers, value next teacher less than next NBA player
• BUT rebuild the world, obviously pay teachers more than sports

Again, compe Total Use with Marginal Exchange

-agree salary has no relation ot moral worth

-money is not the measure of the man

Equal Pay Debate

2 women, work 9 hours in factory at similar job; one in pills, one in make up

-->drug worker paid more

-values matter at the margin, added costs for making decisions

• Context dependent
• values that matter to us are peculiar
• Value arises from human interpretation

Sunk Costs = resources that are not recoverable when one changes/makes a decision

ex: Rizzo in 5 yr relationship, already super invested, can't give it up now?! 

ex: Get your "money's worth" if already bought tickets, whether you attend the event or not does not have an impact on what you spent

No Sunk Cost in the Long Run

Axiom 1: Scarcity

Axiom 2: Humans act with purpose

->behave in a way that makes our lives easier

->people respond to incetives

          -recall dropping $, behavior changes when benefits and costs change

Law of Unintended Consequences

-Decisions have effects that you couldn't predict in advance

ex: Ralph Nadar helped promote mandatory seat belt laws in 1970s

-> changed cost/impact of driving

-when wore seat belt, much more likely to survive, less injuries 

-->lowers cost of getting into an accident

    -people drive more, drive less carefully ==> MORE accidents, more dangerous

-If we REALLY cared about driving safety, would have a spear pointing towards us on steering wheel or drive with our children on the hood