Incentives-Black Rhino

Why does the market for black rhinos create incentives that are different than other markets? How can these incentives be changed?

For other markets the incentive for keeping black rhinos would be to preserve tourism and have outsiders come to their land. Many of the natives still choose to kill the Rhino since it is better financially for them. This market for Black Rhino is breaking down because they are being viscously killed and no one is trying to protect them. A market is based on self interest, and self interest should help the community, but people are not looking at the consequences and are only looking for money. People have tried to change the incentives  by cutting off the horn, but the natives still killed the rhino, so they did not have to chase rhinos without horns (the most expensive part of the rhino). The incentive for killing a Rhino is to make money off of it, but if the incentive was changed to creating more tourism for the country then the mass killing of Rhinos could be stopped. If the natives received a portion of the revenue generated from Tourism, and they understood that the only reason people come to their land is to see the Black Rhino then they would stop killing the Rhino because their incentive have changed.

Power of Markets

In his book, "Naked Economics" Charles Wheelan argues that the soviet economy failed because the government regulated everything that the individuals needed. After a while, it became impossible for the government to regulate everything. Charles also talks about what are economy is based of of individuals trying to make themselves as wealthy as possible. Basically, Individuals seek to maximize utility and thans what are free market economy is based on. An example of this is would be an individual trying to save the most money he can on appliances on a house. He wants to save money because that is a utility we need most in America. He also relates firms to individuals, because like humans firms have to make decisions on how much products to produce, and at what prices to sell them. Both humans and the firms are significant because they keep the economy. If there is no consumption by the individuals then the economy would break down, and if firms do not produce enough products, than individuals would have serious problems. This interaction is an essential part of maintaining an economy. Charles also says that are market rewards scarcity, which basically means that products that are rare are more expensive. An example of this would be Diamonds and Silver, Diamonds cost a lot more because they are very rare. He says that the market provides things that we want to buy rather than things that we need.