I think this shows that my colleague is missing something when he describes the dynamic of concentrated benefits and diffuse costs that can lead to higher government expenditures.
Insurers generally see catastrophe insurance as a bad bet: Premiums that reflect actuarial risk are prohibitively expensive, because the risk pool is concentrated and not large enough to effectively diffuse costs.
Under the NATO umbrella, allies are able to divide the labor and diffuse costs associated with crisis management.
While diffuse, the cost would cover renovations – now finished at a price tag of $94m – and up to a decade's worth of operating subsidies and capital payments – starting at $11.5m a year.
The total package is so diffuse, it costs $223,000 to create a single job.
Further, for those concerned about unsustainable immigration, one unheralded benefit of freer trade agreements such as CAFTA, is that they provide economic opportunities in developing countries that then reduce pressure for migration to the U.S. The problem is that these benefits are diffuse, while costs in the form of lost jobs and closed factories, are highly concentrated.
An important distributional issue with MPAs is that the benefits tend to be diffuse while costs are concentrated.
Due to its non-invasive nature and low cost, diffuse optical imaging (DOI) is becoming a commonly used technique to assess functional activation in the brain.
The benefits of financial globalisation are diffuse, whereas the costs of a big bank failing are concentrated.
As Alan Blinder, former vice chairman of the Federal Reserve, wrote in "Hard Heads, Soft Hearts," "Tariffs and quotas are often politically popular because they impose diffuse and subtle costs on the many to pay for concentrated and highly visible benefits for the few".
They will pay as tax burdens diffuse into the costs of things they buy.
