We regain price theory in our series on price theory with Professor Brian Cutsinger. You can see all Cutsinger issues and solutions by subscribing to the Econlog RSS feed.
Please share your proposed solution in the comments. Professor Cutsinger will appear in comments in the coming weeks and will soon post his proposed solution. I hope the graph is in your Poyro and in the long live price theory!
Question: One of the general arguments about public assistance in the form of direct cash handouts is that recipients use money to purchase what taxpayers feel is purposeful. Suppose the recipient can resell the physical transfer at no cost. In this case, is there a difference between direct cache handouts and physical transfers?
