Assignment:
DISCUSSION 1:
Why would cash transfers typically be preferred by recipients over in-kind transfers? What are the pros and cons of each from a government perspective? Respond to at least two of your classmates.
PEER 1: OSCAR
Why would cash transfers typically be preferred by recipients over in-kind transfers?
In-kind transfers deals with transfers for people who cannot fully provide for themselves, the transfer is intended to help put food on the table for the family and other ways to increase their way of living. (Amacher & Pate, 2013). Cash transfers are prefered by recipients because cash is less restricted and can be used one more items. For example, with food stamps you can go to the grocery store and get food; however, if you have cleaning products or anything along those lines you will have to pay out of pocket.
What are the pros and cons of each from a government perspective?
PROS: As I said earlier, cash is more flexible for purchasing items. It costs less to give cash then it does for agencies to transfer money. In-kind transfers can regulate what the funds are being used for an where they are being used.
CONS: With cash transfers the government cannot track what the money is being used for. With this predicament, the government could essentially be wasting more money than helping people and families.
The pros and cons for cash transfers and in-kind transfers counter each other on many accounts. For my opinion, if you need help from the government then the government should be able to regulate where the money is going.
PEER 2: LARRY
In-kind transfers are available for those who cannot fully help themselves, according to our text. These transactions are to help put food on the table for those who families who cannot sustain living, and to help improve their quality of life. In-kind transactions refer to welfare programs such as food stamps, public housing, Medicaid, legal aid, Head Start for preschool children, and job training programs. In-kind transfers are moved as is; there is no buying or selling involved. For government programs such as food stamps, this essentially means that they are given to those who need/qualify for them. A large share of government benefits for the poor are in-kind rather than in cash.
Cash transactions are more flexible, and less restrictive than in-kind transactions. With cash transactions, the consumer can purchase whatever he/she desires, and whatever quantity. Recipients are more apt to prefer cash transactions over in-kind transactions, because cash is instant money, whereas other forms have to be transferred into cash, and that's expensive.
Pros to cash are that a) it is more flexible. It can be spent on anything. Cash cannot be regulated by the government, as in in-kind transactions
Cons: Not being able to track cash per the government can also be a con; they can't see what the funds they are providing are being used for. A downfall to in-kind transactions is that for example, with food stamps, non-food items cannot purchased. I, like many people, often buy all of my household goods, including cleaning products and light bulbs from the grocery store. Therefore, this is a downfall to me.
DISCUSSION 2:
Who gains and who loses from a tariff? How do the effects of tariffs differ from the effects of quotas? If you were a small country, what would you rather utilize?
PEER 1: ERIC
According to Armacher & Pate (2013), a tariff is a tax on imported goods or services. The tariff can be specific (which is based on weight, volume, or number or units) or ad valorem (a figure based on a percentage of the price). The book further states that the average U.S. tariff is less than 5% (Amacher & Pate, 2013). Although quotas are similar in style to tariffs, they are specific in restricting the quantity of goods that come into the country. Quotas will not typically change the price of the goods and they can also be combined with tariffs.
If operating a small country, I would rather utilize tariffs, as it will provide revenue, where quotas will not. At the end of the day, it is about making a profit, which profit on tariffs comes back to the government.
PEER 2: ASHLEY
When it comes to tariffs and quotas, the Domestic consumers in a country would lose more than the domestic producers, since products would have increased prices. According to our text, Tariffs are the taxes imposed on imported goods and services (Amacher,2013). Domestic companies gain a certain protection when tariffs or quotas are applied to imported goods, because it limits the competition in domestic products and services. Quotas are the quantity limits that specify the amounts of a product or service that can be imported during a period of time. Domestic industries gain from the use of quotas because they are able limit foreign competition.The effects of tariffs differ from the effects of quotas because tariffs increase the price of an imported good or service in a domestic market. The government is also effected differently as tariffs increase revenue for the government and quotas generate no revenue for the government as tariffs (taxes) are only applied to imported goods and services that exceed the specified limit.If I were small country, I would rather use tariffs because tariffs generate revenue for various domestic parties and limit foreign competition.