Understanding the social consequences of the interaction of rational, self-interested individual behavior. . . More interesting still is what happens when hundreds, thousands, or even millions of rational, self-interested individuals pursue their individual goals given that everyone else is doing the same. Economists call the outcome of these interactions an "equilibrium," and it is in this equilibrium that we find the social consequences of individual behavior "cooperation on such massive scale can simply emerge from the bottom up without the individuals knowing that they are cooperating with one another. We are even more fascinated by the fact that the cooperation emerges purely from the rational, self-interested choices that individuals make along the way, each one simply trying to earn a living, to do the best he or she can given the circumstances. This is a social consequence of the interaction of rational, self-interested behavior, one that is guided by the impersonal forces of market prices that tell individuals where to work, what to produce, whom to sell to, etc. "not all social consequences of rational, self-interested behavior are so rosy. We will see that the same economic lens that explains how people cooperate to make pencils also explains how global warming is not tamed by the same forces, how relative (as opposed to absolute) poverty persists, how concentrated power distorts markets, and how some goods might never get produced unless nonmarket institutions intervene." Questions: - Is selfishness the same as self-interest? Explain your view. - Thousands of self-interested individuals interact towards an outcome of equilibrium. Give an example on this. Explain why this is so. - Self-interest may also lead eventually to poverty and global warming. Do you agree? Explain your