Monthly Archives: December 2015

Economics of Gun Ownership and Violence!

Some pearls of wisdom from a university President, “I’ve always thought that if more good people had concealed-carry permits, then we could end those Muslims before they walked in and killed them,” he said during the school’s convocation, before teasing the students about his own gun.” You can find the news here.
Notwithstanding the obvious shameless religious fearmongering the statement enthuses, I thought the following might be worth thinking about or at least have students of economics talk about:
In a game with two actions- have a gun or not, is “have a gun” a dominant strategy making gun ownership a Nash equilibrium of a Prisoners Dilemma? More so, once everyone carries a gun, will we automatically never use ours, as argued in the case of nuclear arms race? What do you think?
On the other hand, there is also an argument of negative externality of gun ownership. The recent shooting in San Bernardino lead to a $17 million expenditure on treating the 250 odd victims, out of which $12 million came from tax payers pockets. This makes gun ownership a strong case of negative externality- and we know how to correct those- tax gun ownership heavily. Of course the question is what is the optimal tax rate- certainly a fruitful research question!

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