Impact of Government Policies on Demand and Supply of Guns in the US Market

This report analyzes the impact of government policies on the demand and supply of guns in the US market from an economic perspective. The report discusses how the regulations on the production and sales of guns have affected the demand and supply of guns in the market. The report also includes a diagram to explain the shift in the demand and supply curve of guns due to the government policies. The report concludes that the policies have successfully affected the country.

Running heads: MICROECONOMICS
Microeconomics
Name of the student
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Author Note

1MICROECONOMICS
Table of Contents
Introduction:...............................................................................................................................2
Economical analysis:..................................................................................................................2
Conclusion:................................................................................................................................4
References:.................................................................................................................................5

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Introduction:
The United States has experienced large number of mass shootings compare to any
other countries of this world. For instance, this number has become 146 between 1967 and
2017 (Jang, 2018). Hence, to prevent those illegal activities, the government of this U.S.A
has imposed various policies to restrict the gun market. Through this law, the government has
controlled manufacturing, trading, possessing and transporting of firearms (Cook, 2018). This
in turn has affected the demand and supply of guns and consequently has restricted firearms
companies to earn revenue. Hence, with the help of some diagrams, this report has intended
to analyze those impacts of demand and supply from the economical perspectives.
Economical analysis:
As the government has imposed regulations on the productions and sales of guns, it
has become difficult for producers to sell those products by large quantity. Due to this limited
availability of guns, purchasers have reduced their demands and this consequently has led the
supply of guns to reduce further. On the other hand, the government has also imposed
restrictions on the buyers. For instance, due to open carry laws, the owner cannot carry the
arm at every place. Moreover, licensed gun dealers cannot sell any firearms to a person, who
has the age below 21 (Webster & Wintemute, 2015). These all activities have negatively
influenced the demand for gun within the market and this in turn has also influenced the
supply of this product as well. This can be described properly with the help of a diagram.

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S0
S1
D0
D1
P0
P1
O
Q1 Q0
Price of guns
Quantity of guns
Figure 1: Demand and supply of guns in market
Source: (created by author)
Figure 1 has represented the demand and supply curve of guns in the U.S.A market.
As the government has imposed policies on this product, producers have reduced their
production of guns due heavy restrictions of selling. Moreover, lack of consumer’s demand
has also forced guns dealers to sale this product by fewer amount (Neba, Walters & Jung,
2018). Hence, the supply curve has shifted to the left, that is, from S0 to S1. On the other
side, consumers have also reduced their demand for guns as the government has imposed
various restrictions on the, as well. This in turn has led the demand curve to shift leftward,
that this, from D0 to D1. Consequently, market prices of guns have decreased from P0 to P1
while the amount of available guns in market has also reduced by Q0 Q1 amount. Form this
outcome, it can be stated that the governmental policy has successfully reduced the available
amount of guns within the market.

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Conclusion:
Hence, after the above discussion, the report can draw a suitable conclusion. The U.S
government has imposed various restrictions on purchasing and selling of firearms within the
market. This in turn has influenced the demand and supply of guns to reduce further and
consequently, the amount of available firearms within market has also decreased
significantly. Thus from this outcome it can be stated that the policies have successfully
affected the country.

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References:
Cook, P. J. (2018). Gun Markets. Annual Review of Criminology, 1, 359-377.
Jang, S. M. (2018). Mass Shootings Backfire: The Boomerang Effects of Death Concerns on
Policy Attitudes. Media Psychology, 1-25.
Neba, G. A., Walters, G., & Jung, H. Y. (2018). Examining the Supply and Demand of
Effective Participation and Representation. In Global Forest Governance and Climate
Change (pp. 145-173). Palgrave Macmillan, Cham.
Webster, D. W., & Wintemute, G. J. (2015). Effects of policies designed to keep firearms
from high-risk individuals. Annual review of public health, 36, 21-37.