Tag: British

After Life — Chip Externalities (explicit language)

Tony joins his colleagues for lunch at a local pub to discuss potential leads for their newspaper, but he’s disturbed by a gentleman loudly munching on chips behind him. The man appears to be ignorant of the external costs he’s imposing on those around him and is focused on only his own satisfaction.

When people are unaware of the external costs they are imposing on others, they tend to overconsume, literally. Since there aren’t clear property rights, it’s not clear who should make the determination of appropriate volume. Tony could pay the man to stop eating his chips, but Tony may argue that the man should have to pay for the right to eat his chips so loudly. It’s harder to reach a solution without clearly defined property rights.

Thanks to Sheena Murray for introducing me to this show. She submitted a different clip from the show, but I looked up the wrong episode and happened to find this clip instead.

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After Life — Ordering a Kid’s Meal

In this clip, the main character, played by Ricky Garvais, is taking his nephew out to lunch. They decide to both order the fish sticks meal from the kids’ menu. When Ricky attempts to order this meal, the waitress informs him it is only for children. Although the café is practicing a common form of price discrimination, Ricky’s character is confused and argues he should be able to order the meal and pay a smaller price for a smaller portion. The server argues this is not true, and that the meal is made cheaper for children. The character claims his nephew is hungry and wants to eat two meals… much to the waitress’s chagrin.

This clip is an excellent display of price discrimination, the necessary condition of being able to segment the consumer base (by age- with visual confirmation), and a conversation/confusion around if different prices truly reflect different marginal costs of production.

Thanks to Sheena Murray for the clip submission and summary!

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Monty Python — Cheese Shop Sketch

One of the many benefits of international trade is increased product variety because countries can devote resources to the goods they have a comparative advantage in. Monty Python demonstrates what a world without trade would look like. After going through a list of a variety of different types of cheese (even cheddar!), but nothing is available. The finest cheese shop is at least clean!

Thanks to Rob Szarka for the clip suggestion on his Twitter account!

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Last Leg — David Mitchell on Tax Avoidance

The Last Leg is a British comedy and late night television talk show similar to the Late Show or The Tonight Show in the United States. The economist David Mitchell was a guest one night and opted to talk about taxes, tax evasion, and tax avoidance. He notes that people who have a conscious and try to pay their “fair share” of taxes are actually being taxed at a higher rate than those who are trying to avoid paying taxes. This is backwards from the traditional notion that governments should use taxes to discourage bad behavior.

Thanks for the clip Chris Neill.

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Golden Balls: Coordination

In the great British game show, Golden Balls, contestants must decide whether to cooperate with each other or be devious.  The dramatic outcome of the game (replicated here) is that one will steal and the other will be honest. This variant of the game has a unique twist to ensure cooperation.

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Golden Balls: Split or Steal

In one of the greatest game theory game shows produced, contestants play a simultaneous-move game where they must decide whether to split or steal money from each other.

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