An Economic Analysis On Existent Costs

Existence will have its costs and prices, and different existent environment bring about different existent costs. Existence has become a major issue which economics will be involved in. From the view of economic individuals in close environment, the article tries to analyze the expenditure of existent costs, the influence of environment on existence, the influence of existence on environment, etc; thus to make a theoretical reference for the analysis of the relationships between environment and existent costs. It consists of ten chapters, divided into four parts. The first part (chapter 1) introduces the main content of this research; the second part (chapter 2₃) introduces the basic meanings of existent cost; the third part (chapter4₅) explores the relationships between environment and existent costs; and the last part (chapter 6) illustrates the possible fields in which the theory of existent costs will be available. Chapter 1: Introduction This part is intended to make a brief introduction of the main content of this dissertation. It demonstrates the purpose and significance of the researches on existent costs. Based on the generalization of the relevant previous researches on existent costs and the comments on those researches, it puts forward the content, the train of thought and the means of the theoretical researches on existent costs, it also shows the new views of this dissertation. Chapter 2, The Meanings of Existent Costs This part introduces the meanings of existent costs, the supposed prerequisites of this research, and the view of this research, From the relationships between existence and the expenditure of costs, it comes to the conclusion that human beings never consume natural resources or energy; instead they only change the physical or chemical forms of the resources; and labor is the only consumption of human beings. Thus existent costs just refer to the labor which is consumed in order to transform natural resources for full use by economic individuals within the process of existence. Chapter 3: Existent Costs and Existent state Existent costs are always in a certain existent state. Existent state refers to the total sum of utility which economic individuals have gained under given environmental conditions. Economic individuals use environmental resources to produce existent products, and receive benefits in the process. Both existent costs and utility are functions of existent products, that is to say, both existent costs and the total utility can be adjusted through changing the quantity of existent products. Besides, possible outputs of existent products depend on environmental conditions. Under given environmental condition, there are only the existent cost curve and the utility curve, which are unique and corresponding to each other. When the existent balance is achieved , the balance between existent costs and utility can be gained; then the amount of existent costs of the economic individuals will be determined. And the equality between marginal existent costs and marginal utility conditions brings about the existent balance. The analysis of the balance between existent costs and utility in this part supplies the following researches with the rational and analytical tools. Chapter 4: The Quantification of Existence Cost Like the economic term—value, utility and transitional costs, existent costs have no counting functions as in the subjects of accounting and statistics. Instead, it can only be used as an analytical tool in researches on the relationships between existence and environment. The analysis of the quantification of existent costs aims at analyzing, the quantitative relationship the economic variables that are related to existent cost. And the essence of the quantification of existent costs are the labor time which economic individuals have spent in producing existent products; while existent costs are the total sum of labor the economic individuals have expended in the whole process of existence and development. Chapter 5: A Comparison between Existent costs and Environment When we analyze existent costs, we should compare all the existent costs among different economic individuals under different environmental conditions, Under similar environmental conditions, the intensity of resources leads to differences in average existent costs of different economic individuals; while under different environmental conditions, because of the different levels of utility which economic individuals have achieved, there also exist differences in the sum of existent costs. Therefore, when economic individuals choose environmental conditions, they always choose the better. Meanwhile they prefer higher intensity of resources under similar environmental conditions for higher utility and lower average existent costs. Chapter 6: The Influence of Environment on Existence Costs Environmental abundance is a key factor to existent costs, and it is in inverse proportion to existent costs. There are a series of links in the transformation of environmental resources and within each link, the labor cost is in direct proportion to the existent costs. The deployment of resources influence the rate of utilization of resources; furthermore, it will influence existent costs. Chapter 7: The Influence of Existence on Environment (1)As we all know, economic individuals have negative influence on environment in the process of existence, such as over exploitation of resources and environmental pollution by economic activities. These bad effects destroy the original functions of environment on the existence of human beings, lower the competence of resources, thus lower the utility level of economic bodies, and raise the average existent costs. The basic measure to solve these problems is to limit the activities of economic individuals in the range that environment is able to bear. Chapter 8: The Influence of Existence on Environment (2) In fact, the existent costs expended by economic individuals in the process of existence is the investment in environment. The investment in environment can improve the competence of environmental conditions, can increase the intensity of resources, can raise the utility level of economic bodies, and can lower the average existence cost. When economic individuals choose environment, they usually pursue the best optimization between environmental investment and environmental profit. Chapter 9: Technical Progress and Existent Costs Technology is the means to transform environmental resources into existent products, which functions as a bridge, connecting economic individuals and environment together. The labor expended by technological progress is one part of existent costs, and their profits are just the utility rate of environmental resources, they can improve the coordination between economic individuals and environment, increase the utility of economic individuals, and reduce the average existent costs. Chapter 10: The Use of the Theory of Existent Costs The theory of existent costs provides people not only with a new view to know the relationships between existence and environment, but also with a new possible available reference in the evaluation of environmental resources, the solution to environmental pollution, the appraisal of environmental protection, the fair distribution of resources, the economic development and social politics and culture.