Category: Movie

It’s a Wonderful Life — Bank Run

With things headed in the wrong direction economically, George tries to head to the bank to convince the town members that they shouldn’t withdrawal all of their money from the bank at once. He quickly recognizes that a bank run would cripple the local economy and he does what he can to prevent it.

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Moscow on the Hudson — Coffee Aisle

 

Robin Williams stars as a defected Soviet living in the United States in Moscow on the Hudson. His shift from communist markets to American-style markets is a bit overwhelming as he visits a grocery store to find the coffee aisle. After realizing that there’s no line to buy coffee and that there are a dozen varieties of coffee, he passes out in the middle of the store.

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Moby Dick — The Ship

Two potential sailors come aboard the Pequod to inquire about becoming joining the crew. Peleg asks why any man would want to become a sailor when the conditions are so rough. He works through the requirements of being a sailor to make sure the men are willing to undergo through strenuous conditions. The reason whalers were so well-paid at the time was because the risk of death aboard the ship.

Here’s a good interview from The Daily Show with Jon Stewart and the captain of a fishing boat on the show Deadliest Catch.

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Trading Places — Orange Juice Trading

It’s time to short sell the orange juice commodities in Trading Places. Billy and Louis wait for the right price to sell and then hear from the Secretary of Agriculture that the market for oranges won’t be as bad as anticipated so then turn around to buy cheap.

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The Hudsucker Proxy — The Hula Hoop

This is a clip from the movie “The Hudsucker Proxy” (1994). In the scene, the store owner have a hard time selling the Hula Hoop. He kept lower the price but still no one wants to buy the Hula Hoop even he end up giving them for free with any purchase. He then throw all them out of the store and one of them accidentally bump into a boy. The boy start playing with it and the other kids saw it. After that, they all run to the store for the Hula Hoop. As more and more kids tried to buy a Hula Hoop, the price goes up again and even higher than before.

This related to the idea of demand and supply. At first, the Hula Hoop was not popular for kids so there’s no one wants to buy it. However, after the kids saw the boy playing with it, their preference change. Preference can change the demand of a product. When the demand increase, the price of the product and the supply also increase.

Thanks for the clip and summary Yi Chun Liu.

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You’ve Got Mail — Monopolistic Competition

 

Struggling children’s bookstore owner Kathleen Kelly (Meg Ryan) tries to remain positive as a big retail chain bookstore, Fox Books, opens around the corner. She outlines the differences between their products and services and notes how this could be a good thing for her business. When business try to differentiate their products, they are often operating in a monopolistically competitive environment. The one issue with the entrance of a new competitor in these markets is that it decreases demand for the other firms even if they are a little different. The accountant notes that their revenues are down compared to the same week last year.

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Wedding Crashers — Free Riding

Jeremy and John are seasoned wedding crashers and they are out looking for weddings to get easy dates, open bars, and nice meals. This example of free-riding works well because none of them pay the cost of attendance and they even come up with creative tricks to not have to pay for the cash bars.

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