Suppose that investing $10 million on eradicating mosquitoes carrying the Zika or other infectious virus will have a clear and significant impact on the spread of this disease, saving over 500 lives and preventing disabling conditions in another 500 persons. Suppose that an equal investment into a new trading platform will produce $300 million in additional revenues to a brokerage firm. Consider the following rhetorical questions:

a. Which investment is likely to produce more social benefits? Which investment is likely to produce more private benefits to the decision-maker?

b. Would an institution that makes the investment that produces more social benefit be more highly regarded by society than the institution making the investment with higher private by society than the institution making the investment with higher private benefits?

c. Should governments play a significant role in making such decisions?

Answer rating: 100% (QA)

a Social and Private Benefits The investment in eradicating mosquitoes carrying the Zika or other infectious virus is likely to produce more social benefits compared to the investment in a new trading ... View the full answer