SUMMARY / RELATED TOPICS

Deadweight loss

Deadweight loss known as excess burden, is a measure of lost economic efficiency when the optimal quantity of a good or a service is not produced. Non-optimal production can be caused by monopoly pricing in the case of artificial scarcity, a positive or negative externality, a tax or subsidy, or a binding price ceiling or price floor such as a minimum wage. Assume a market for nails where the cost of each nail is $0.10. Demand decreases linearly; the price of $0.10 per nail represents the point of economic equilibrium in a competitive market. If market conditions are perfect competition, producers would charge a price of $0.10, every customer whose marginal benefit exceeds $0.10 would buy a nail. A monopoly producer of this product would charge whatever price will yield the greatest profit for themselves, regardless of lost efficiency for the economy as a whole. In this example, the monopoly producer charges $0.60 per nail, thus excluding every customer from the market with a marginal benefit less than $0.60.

The deadweight loss due to monopoly pricing would be the economic benefit foregone by customer with a marginal benefit of between $0.10 and $0.60 per nail. The monopolist has "priced them out of the market" though their benefit exceeds the true cost per nail. Conversely, deadweight loss can arise from consumers buying more of a product than they otherwise would based on their marginal benefit and the cost of production. For example, if in the same nail market the government provided a $0.03 subsidy for every nail produced, the subsidy would reduce the market price of each nail to $0.07 though production still costs $0.10 per nail. Consumers with a marginal benefit of between $0.07 and $0.10 per nail would buy nails though their benefit is less than the real production cost of $0.10. The difference between the cost of production and the purchase price creates the "deadweight loss" to society. A tax has the opposite effect of a subsidy. Whereas a subsidy entices consumers to buy a product that would otherwise be too expensive for them in light of their marginal benefit, a tax dissuades consumers from a purchase.

This excess burden of taxation represents the lost utility for the consumer. A common example of this is the so-called sin tax, a tax levied against goods deemed harmful to society and individuals. For example, "sin taxes" levied against alcohol and tobacco are intended to artificially lower demand for these goods. Indirect tax, weighs on the consumer, is not a cause of loss of surplus for the producer, but affects consumer utility. Harberger's triangle attributed to Arnold Harberger, shows the deadweight loss associated with government intervention in a perfect market. Mechanisms for this intervention include price floors, taxes, tariffs, or quotas, it refers to the deadweight loss created by a government's failure to intervene in a market with externalities. In the case of a government tax, the amount of the tax drives a wedge between what consumers pay and what producers receive, the area of this wedge shape is equivalent to the deadweight loss caused by the tax; the area represented by the triangle results from the fact that the intersection of the supply and the demand curves are cut short.

The consumer surplus and the producer surplus are cut short. The loss of such surplus, never recouped and represents the deadweight loss; some economists like James Tobin have argued that these triangles do not have a huge impact on the economy, but others like Martin Feldstein maintain that they can affect long-term economic trends by pivoting the trend downwards and causing a magnification of losses in the long run. It is important to make a distinction between the Hicksian and the Marshallian demand function as it relates to deadweight loss. After the consumer surplus is considered, it can be shown that the Marshallian deadweight loss is zero if demand is elastic or supply is inelastic. However, Hicks analyzed the situation through indifference curves and noted that when the Marshallian demand curve is inelastic, the policy or economic situation that caused a distortion in relative prices has a substitution effect, i.e. is a deadweight loss. In modern economic literature, the most common measure of a taxpayer's loss from a distortionary tax, such as a tax on bicycles, is the equivalent variation, the maximum amount that a taxpayer would be willing to forgo in a lump sum to avoid the distortionary tax.

The deadweight loss can be interpreted as the difference between the equivalent variation and the revenue raised by the tax. The difference is attributable to the behavioral changes induced by a distortionary tax that are measured by a substitution effect. However, not the only interpretation, Lind and Granqvist point out that Pigou did not use a lump sum tax as the point of reference to discuss deadweight loss; when a tax is levied on buyers, the demand curve shifts downward in accordance with the size of the tax. When tax is levied on sellers, the supply curve shifts upward by the size of tax; when the tax is imposed, the price paid by buyers increases, the price received by seller decreases. Therefore and sellers share the burden of the tax, regardless of how it is imposed. Since a tax places a "wedge" between the price buyers pay and the price sellers get, the quantity sold is reduced be

K. M. Maulavi

Kaathib Thayyil Mohammed Kutty Musliyar, popularly known as K. M. Moulavi or K. M. Maulavi, was an Indian revolutionary, he was a leader of the Indian independence movement, Khilafat Movement, Muslim League and Islahi Movement from Malabar district. He was a religious scholar who promoted modern education, the Malayalam language, Muslim women's education, he worked to uplift the Mappila community after the Malabar rebellion. Maulavi was the founding leader of Kerala Muslim Aikya Sangham, Kerala Jamiyyathul Ulama, founding president of Kerala Nadvathul Mujahideen and founding vice president of Indian Union Muslim League Malabar district committee. Maulavi was born in 1886 near a municipal town in Malapuram, he was educated by his parents, Thayyil Kunhi Moitheen and Ayisha, who were known for religious scholarship. He studied under Chalilakath Kunahmed Haji, a prominent scholar at Vazhakkad Darul Uloom Arabic college. Vazhakkad Darul Uloom Arabic college is the first Arabic college in Kerala. While studying there with Chalilakath Kunahmed Haji and serving as a scribe, he earned the name Kaathib.

Maulavi was a leader of the Malabar Khilafath committee. He organized Khilafath meetings from November 20, 1920 in Kondotty to January 15, 1921 in Kozhikkode, in Ernad, Valluvanad and Ponnani Taluk, with the intention of inviting the Muslim masses into the Indian national movement. On February 2, 1921 he served as a founding member and leader of Kerala Majlisul Ulama, Kerala faction of Majlis-ul-Ulama'e Hind along with E. Moidu Moulavi. In the Arabic book Mahakal Khilafat Dismil Khalifa, Maulavi argued against orthodox Muslim clerics who were supportive of the existing relationship between India and the British, he urged Mappila Muslims to seek a peaceful resolution to their grievances. When the Malabar protest devolved into armed struggle, he continued to advise the necessity of a peaceful protest. British police issued an arrest warrant for Maulavi after the Malabar rebellion, but he moved to Kodungallur and lived there for about 11 years. Kottappurath Seethi Mohammed Sahib, the father of K. M. Seethi Sahib and Manappattu Kunjahammed Haji supported him there.

He conducted many Islamic classes, strengthening reform movement in Kodungallur. He was influenced by Vakkom Moulavi, he criticized superstitious beliefs and orthodoxy practiced among the Muslim community and asked them to distance themselves from such acts. He helped form Kerala m Aikya Sangam in 1922, the first socio-religious organization of Muslims of Kerala; the organization aimed to settle disputes among Muslims. Maulavi was noted for his religious scholarship, his Fathwas was published in an Arabi Malayalam magazine. He was the founding leader of Kerala Jamiyathul Ulama and the founding President of Kerala Nadvathul Mujahideen, he was the founding leader of Tirurangadi Muslim orphanage. He was the founding joint secretary of Rouzath-ul-Uloom association, parental body of Farook College. Although he started his political life in the Indian National Congress, he left to join the All-India Muslim League due to his dissatisfaction with the INC leadership and their treatment of the Mappilas, he was the founding vice president of Indian Union Muslim League and played a significant role in building the Indian Union Muslim League in Malabar until his death in 1964.

He was the editor and publisher of Al-Murshid, Al-Irshad and Muslim Aikyam magazines

Joseph Swain (engraver)

Joseph Swain was an English wood-engraver. He is best known from his engravings in Punch magazine of cartoons by Sir John Tenniel. Born in Oxford in 1820, he was second son of Ebenezer Swain by his wife Harriet James, he was educated at private schools, first in Oxford, in London, where the family moved in 1829. In 1834 Swain was apprenticed by his father, a printer with the firm of Wertheimer & Co. to the wood-engraver Nathaniel Whittock, was transferred in 1837 to Thomas Williams, brother of Samuel Williams. In 1843 he was appointed manager of the engraving department of Punch, but in the following year set up in business for himself, retaining the whole of the engraving work for Punch from 1844 until 1900, he taught William Harcourt Hooper. Swain died at Ealing in west London in 1909. Swain was one of the most prolific wood-engravers of the nineteenth century, his own work is not always signed, the signature "Swain sc" must be taken to include the engraving of assistants working for his firm.

In the 19th century his wood-engravings were printed from electrotypes. Nearly all the illustrations in the Cornhill Magazine were engraved by Swain, he worked for other periodicals such as Once a Week, Good Words, The Argosy, for the publications of the Religious Tract Society and the Baptist Missionary Society, he engraving extensively after Fred Walker, John Everett Millais, Frederick Sandys, Richard Doyle, Richard Ansdell, Fred Barnard, other major illustrators, from 1860 onwards. A series of articles on Fred Walker, Charles Henry Bennett, George John Pinwell, Fritz Eltze, which Swain wrote for Good Words, were incorporated in Toilers in Art, edited by Henry C. Ewart. In 1843 Swain married Martha Cooper, they had three daughters and a son, Joseph Blomeley Swain, who carried on the printing and engraving establishment. Attribution This article incorporates text from a publication now in the public domain: Lee, Sidney, ed.. "Swain, Joseph". Dictionary of National Biography. 3. London: Smith, Elder & Co.'A Clever Man': Joseph Swain as an Engraver and Interpreter at Victorian Web Works by Joseph Swain at Faded Page Works by or about Joseph Swain at Internet Archive Joseph Swain at Library of Congress Authorities, with 4 catalogue records