A Series of Unfortunate Events – Paid in Coupons

The Baudelaire orphans have been sent to the Lucky Smells Lumbermill and are being forced to work on the production floor. After a grueling morning of “log day,” the workers are given an entire five minutes for lunch, but the Baudelaire’s come to find that lunch consists of gum. Frustrated, they wonder if they can use their wages to buy something else, but it turns out that the Lucky Smells Lumbermill pays their workers in coupons rather than actual currency. The coupons don’t have any value since the workers don’t have any money to go out and buy things anyway. The workers also don’t have power to leave or demand better conditions because Lucky Smells is the only place to work in town.

When a single firm controls the labor market in a region, they are said to have monopsony power in the market. Monopsonies can pay workers below competitive wages because workers are unable to find alternative employment opportunities. In this case, the Lucky Smells Lumbermill pays them almost nothing since the coupons can’t really be redeemed anywhere.

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A Series of Unfortunate Events – Aunt Josephine’s Risk Tolerance

The Baudelaire orphans have been sent away to live with their Aunt Josephine. They’ve been told how formidable and fierce she is, but it turns out that Aunt Josephine is incredibly risk averse. She has disconnect the doorbell and the telephone because someone may be electrocuted if they have a faulty pacemaker, even if no one in the house has a faulty pacemakers. Risk averse individuals are willing to give up some benefits (in this case, doorbells and phone calls) in exchange for avoiding possible negative consequences (electrocution).

2021 1

A Series of Unfortunate Event — Library Operating Hours

Olivia is frustrated with the administration because they only allow the library to be open for a short amount of time. She rightly notes that it doesn’t actually cost anything for the library to be open longer, partly because her salary is paid regardless of the number of hours. The administration, though, has used the money for personal reasons and doesn’t understand why it needs to be open longer. Olivia argues that the marginal cost of operating the library is zero, which implies that operating the library is only one large fixed cost.

Thanks to Brittany Pifer for the scene recommendation!

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