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Opportunity cost is an important concept in economics. For every decision you make, there are tradeoffs. The same is true for economic policy. If the government decides to preserve land from being mined, the economy foregoes whatever resources were in there to begin with. If the mine is built, it may disrupt the ecosystem and/or have adverse effects on the water supply. One important tradeoff is between short term benefit and long term gain. Opportunity cost plays a major role in the conflicts of interest between two policies.
Do we build more wind turbines and solar farms to meet our climate targets or do we allow the coal plants to run a bit longer?
Should a city government increase pensions for public workers, but at the cost of increasing the deficit?
Do we care more about security or privacy?
Should it be harder to buy a gun to reduce murders or do we accept the risk and find a different way?
Should free speech be restricted so that the alt right can't flourish or do we allow it because it's a slippery slope?
Do we institute a series of government policies which history shows isn't sustainable but hey, it'll make the working class happy?
Should the US be involved in worldly affairs because there might be some injustice going on or do we let the world take care of itself because we're just making things worse?
Do we try something new and accept the risk or do we stick with what we know?
Opportunity cost can deadlock political decision because the things which need to be accomplished come at the expense of one another.
For an example, say that you're a city planner and more people are moving into your city, there are three conflicting goals: traffic/neighborhood character, surrounding environment, and adequate housing supply. When lots of people are moving into your city, you cannot meet all three. Meet the first two and cost of living skyrockets due to limited housing supply. Meet the previous two and you get traffic jams (which can be somewhat mitigated by public transportation and congestion pricing) due to higher density living. Meet 1 and 3 and you get suburban sprawl. The only way to meet all three would be to have rent control and affordable housing, both of which further entrenches the local population at the expense of people moving in.
Do we build more wind turbines and solar farms to meet our climate targets or do we allow the coal plants to run a bit longer?
Should a city government increase pensions for public workers, but at the cost of increasing the deficit?
Do we care more about security or privacy?
Should it be harder to buy a gun to reduce murders or do we accept the risk and find a different way?
Should free speech be restricted so that the alt right can't flourish or do we allow it because it's a slippery slope?
Do we institute a series of government policies which history shows isn't sustainable but hey, it'll make the working class happy?
Should the US be involved in worldly affairs because there might be some injustice going on or do we let the world take care of itself because we're just making things worse?
Do we try something new and accept the risk or do we stick with what we know?
Opportunity cost can deadlock political decision because the things which need to be accomplished come at the expense of one another.
For an example, say that you're a city planner and more people are moving into your city, there are three conflicting goals: traffic/neighborhood character, surrounding environment, and adequate housing supply. When lots of people are moving into your city, you cannot meet all three. Meet the first two and cost of living skyrockets due to limited housing supply. Meet the previous two and you get traffic jams (which can be somewhat mitigated by public transportation and congestion pricing) due to higher density living. Meet 1 and 3 and you get suburban sprawl. The only way to meet all three would be to have rent control and affordable housing, both of which further entrenches the local population at the expense of people moving in.