Sun's+Page

= **The Truth  Behind Hagwons ** = = =

media type="file" key="AP ECON EXAM 3 PROJECT.mov" width="398" height="308"

FIRST
The reason why I want to talk about Hagwons is because Hagwons not only affect negatively on our work habits, but also have a major impact on our economy. For example, going to hagwons bring many opportunity costs, such as sleeping, playing sports, watching television, but most importantly the "time". Our 'golden' time is wasted while we are staying hours and hours in hagwons. The reason why we sometimes feel that we don't want to go out hagwons on a specific day is because we have a greater opportunity cost by going to our hagwons: the time needed to sleep and the time needed to study for tests the next day.



Hagwons are institutes that helps students to understand and get further knowledge in a particular subject. For example, if you go to a math hagwon, then you get help with math and perhaps be super smart in math later on. According to JoongAng Daily, by 2008 there were approximately 70,213 hagwons in Korea, which is a 49 percent increase in the numbers of hagwons from 1970 to 2008.

Diminishing Marginal Utility

Diminishing marginal utility is about the additional self-satisfaction or perhaps self-exhilaration that one can get by having an extra good.

By going to hagwons and staying there for a long time, we assume that our marginal utility will increase on and on. Yet, is this true? Well let us think. Will studying in hagwons for almost over 6 hours really help us to get better GRADES and lead us to SUCCESS? The answer is "NO". Going to a hagwon and staying there for a long time does not mean you will learn more things. In fact, most students can only concentrate and actually "pay attention" to things for 20 minutes max.

Thus, it will cause you to have more diminishing marginal utility as you stay longer and longer. As time passes, you will get more tired, hungry, sleepy and have '0' concentration. Your amount of benefit of learning more knowledge in hagwons will slowly decrease and decrease and in fact, your "loss" of staying in hakwon would be greater than what you would gain if you continue further.

Perfectly competitive firm or Monopoly?



Perfectly competitive market is a market where the firms cannot decide how much money they should get by selling each of their goods. In short, this means that the firms do not have the market power. On the other hand, the definition of monopoly is the very opposite. Monopoly is a firm that has certain market power, which allows it to decide how much money it should get from its consumers, who would want to buy its goods. Monopolies' supply and demand meet at the profit-maximizing output, allowing the them to earn huge profits unlike the perfectly competitive firms.

Because there are countless numbers of hagwons that teach same subjects almost everywhere you go, hagwons in Korea are in perfectly competitive market. Thus, most hagwons ask for similar amount of tuition fees, because they are perfectly competitive firms that do not have the market power. We also call these firms as "price takers".

YET, not ALL hagwons are like this. Some hagwons, in fact, require tuition fees that are 2 or even 10 times greater than that of the others. This shows how some hagwons can control their prices and earn profits at the same time, because there are people, who are willing to pay that much money to go to these hagwons. Thus, in a way, hagwons can be monopoly firms. In this case, these monopoly firms are called "price setters".

Negative externality Negative externality is about affecting negatively on bystanders. In this case, hagwons cause harm to schools, because students who go to hagwons do not concentrate in studying and do not participate in classes while they are at schools, either because they already know the topics that are being covered or because they are too tired of "over"-studying.

Thus, this causes the teachers to not feel happy about teaching the students, for their students are not doing what they are supposed to do in the classes. Also, because some teachers expect all students to go to hagwons in some schools, they do not teach specifically and just cover the topic really roughly. Thus, for those who are not going hagwons, they get disadvantages in learning the subject, which is what the negative externality is about.

Positive externality

Positive externality is about affecting positively on bystanders. In this case, the establishment of hagwons perhaps do help students to improve in their skills and knowledge. Thus, because of this, other students who do not go to hagwons may feel the "competition" and as a result, work harder than before, which is a form of positive externality. Also, because going to hakwons allow the students to become better thinkers and smarter in a way, this allows Korea's technology advancement to grow. This increase in technology would increase the productivity and thus lead to better economic and social conditions within the country, which is also a form of positive externality.

Conclusion

In conclusion, hagwons definitely have an impact on our society today. They have good and bad effects, such as having positive externality of leading Korea to be more efficient and productive while also having a negative externality of causing students to not concentrate in school and thus, making schools to lose its main purpose - teaching students thoroughly and effectively. Even in the future, hagwons will definitely exist in Korea as major institutions that perhaps, help but at the same time hurt the nation's economy and overall advancement of the country.


 * __Bibliography__**

http://joongangdaily.joins.com/article/view.asp?aid=2913964 http://en.wikipedia.org/wiki/Attention_span http://www.maximizingutility.com/2009/05/diminishing-marginal-utility-of-money.html http://spot.colorado.edu/~kaplan/econ2010/section9/section9-main.html http://tutor2u.net/economics/content/topics/monopoly/benefits_of_monopoly.htm http://extraordinarymomsnetwork.wordpress.com/2009/08/28/school-daze-whats-best-for-your-child/ http://anuj-mehta.blogspot.com/2009/08/productivity-woes.html