Anders Chelgren, Chapter 2, Question#2

Incentives effect every decision we make. For every choice we weigh the opportunity cost and the basis of those decisions stem from the incentives drawn by one option over the other. Incentives are apart of each choice in life and ultimately lead to a specific goal. I attend school five days a week not because I always enjoy it, but because the possibility of a better job, and better understanding of the world around me, is a strong incentive. Everyone acts in their self interest and, "Self interest makes the world go around" (Wheelen 34). Incentives are incredibly important because of their relevance and how often they must be correctly implemented in order to achieve a desired goal. Naked Economics did a good job illustrating some scenarios in which governments or companies desired a specific goal but had trouble achieving said goal due to improper incentives. These were examples of bad policy and thus they failed. "Good policy uses incentives to channel behavior towards some desired outcome, bad policy either ignores incentives, or fails to anticipate how rational individuals might change their behavior avoid being penalized" (Wheelen 39). My life decision's, wether I chose to embrace them or not, are driven by incentives.