This commercial is a great opening piece to talk about the differences between equity and efficiency. While both young girls are better off that before (efficiency improvements), they are not relatively better off because one is getting an actual pony (equity issues). One of the hard portions of this concept is to think about this issue as a true tradeoffs that efficiency gains often come at the cost of decreased equity. This increase in inequality between the two girls may be a nice, short way of demonstrating that tradeoff.
King of Queens — A Wasted Tombstone
Arthur bought a tombstone a while back in order to save money and the salesman assured him that he would most likely be dead by 2000, so he pre-printed the “19” on the tombstone so that they would only have to fill out the end of the year. Fast forward to 1999 and Arthur finds out he has 8 months to die or else his tombstone will go to waste. This clip is a succinct enough clip to teach about sunk costs since the price of the tombstone has already been paid and Arthur wouldn’t be able to get his money back.
Construction Site in Thailand
A few years back there was a popular video of a human powered ferris wheel in India. I use that clip to talk about labor abundance in the Heckscher–Ohlin model of trade since India is so labor-abundant. Earlier we came across this fantastic video of a construction site in Thailand (another labor rich country). For small construction jobs, the workers will use manpower (literally) instead of machines to drive piles into the ground. This clip could also be used in a labor economics setting if you’re talking about substitutes in production. Either way, this is a fun-video for class with a pretty nice beat from the tambourine-wielding foreman.
CBS Early Show — Same Price, Smaller Product
One way that companies can reduce supply without customers realizing it is by changing the size of the packaging. This actually makes the per unit price higher, which matches with the theory of decreasing supply. This decrease in supply could come from changes in input prices or perhaps shifts in agricultural markets, like freezes in Florida and oranges.
John Stossel — The Fight Against Food Trucks
John Stossel, through ReasonTV, looks at the regulations behind the food truck industry. From a competitive market standpoint, food trucks have the ability to respond to high demand areas by relocating at any given moment. For brick-and-mortar businesses, however, food trucks enter the market as a low-cost competitor and steal customers from permanent restaurants. Many cities in the United States have setup regulation limiting the location of food trucks or the hours they may operate. This rent seeking behavior, however, limits the amount of options available to consumers in the name of “fairness.”
John Stossel — The Economics of Sports Stadium
John Stossel is back to discuss sports stadiums (mega events) and why their subsidies aren’t worth the investments from an economic standpoint. Along with economist, JC Bradbury, Stossel investigates the counterfactual to the claim that stadiums and mega events will become an economic boom to cities and states.
NY Times — The 1998 NFL Draft: A Look Back at the Epic Ryan Leaf Bust
One of the struggles with hiring workers is evaluating talent, specifically for college athletes considering the NFL. In 1998, Ryan Leaf appeared to be the top college athlete even with some questionable character flaws. The Colts, instead, chose to select Peyton Manning with their first pick of the draft despite some criticism. Manning went on to be one of the winningest QBs in NFL history while Ryan Leaf is considered one of the biggest NFL busts in the history of the league. This clip from the New York Time’s Retro Reporting division revisits that controversial decision.
The Daily Show — Wage Against the Machine
This video does a nice job of describing many of the economic arguments for and against raising the minimum wage in a comical way. The clip is a few years old, but it still does a nice job of discussing many of the common arguments. Note: the clip does include a supply and demand graph, but it labels supply and demand incorrectly! This is a good opportunity to discuss economic misconceptions, as well as the labor supply and labor demand curves.
Thanks to Rebecca Chambers for the clip and description!
The National — Bread Collusion in Canada
Over the past 15 years bakers in Canada have been colluding to raise the price of bread across many of Canada’s major retailers. The retailers (allegedly) agreed to the price increase so long as the others in the group also maintained the high prices. While some of the retailers are denying the claim, Canada’s Competition Bureau is developing a case to expose the participants.
Reason TV — Why Stadium Subsidies Always Win: Q&A with J.C. Bradbury
Local municipalities often dump significant resources into funding sports stadiums in the hopes of attracting economic benefits from additional tourism. Despite criticism from nearly every economist, economic impact reports are designed and pitched to citizens as the justification for subsidizing sports teams. In this interview, JC Bradbury discusses the counterfactual of tourists’ true impact and how these stadiums continue to be funded.
If you’d like more to read more about sports stadiums and funding, check out Field of Schemes.