Tag: Utility

Braveheart — We Didn’t Get Dressed Up for Nothing

In this scene, the Scottish army is waiting to fight the English army. William Wallace (Mel Gibson) is going to “pick a fight” and make sure that the nobles from each army don’t negotiate a peace. His fellow leaders are in charge of passing out weapons. When asked what to do they remark, “we didn’t get dressed up for nothing.” 

They are falling prey to the sunk cost fallacy. Just because they’re all dressed and ready to fight doesn’t mean that is the logical thing to do. The soldiers are not using effective marginal analysis to determine whether fighting is the next best course of action.

Thanks to Luke Starkey for the clip and summary!

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Saturday Night Live — Chance The Rapper’s 2nd Favorite Things

Chance the Rapper is grew up in Chicago, which is nicknamed “The Second City.” In honor of his hometown, Chance the Rapper (along with Kyle Mooney) shares some of his other favorite second-best items, which he considers better than the first. This is a fun introduction to substitutes, or even monopolistic competition and product differentiation. This could be used in an upper-level class to discuss ordinal preferences or transitivity.

Thanks to Kim Holder and Darshak Patel for tweeting this video!

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Could Have Had a V8

One of the classic commercials of the 1970s came from V8 (they have updated ones as well!). Unknowing consumers of snacks and sodas realize mid bite/drink that they could have had a V8 instead of their other choice. The concept of opportunity costs is that by consuming an item, you give up the opportunity to consumer something else. A rational individual will pick the item with the highest level of utility, but sometimes we aren’t fully aware of all the alternatives. The individuals in this commercial only realize when it’s too late.

The clip was described in Joel Waldfogel’s book, Scroogenomics: Why you shouldn’t buy presents for the holidays. Dr. Waldfogel also appears in an Adam Ruin’s Everything episode on the inefficiencies of gift giving.

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The Good Place — Externalities & Unintended Consequences

 

Things seem off in The Good Place, but it turns out that the as the world becomes more complicated, seemingly identical actions (like giving flowers) can have unintended consequences that most people don’t realize. Our private actions can have social costs that we’re unaware of and would probably try to avoid if we were fully informed of their costs.

Thanks to Kalina Staub (Twitter) for the clip!

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Young Sheldon — Productivity and Technology

The Cooper Family decides to purchase a new computer after Sheldon convinces his mother about all the things it could do for the family. Sheldon shows his parents how their life is a bit easier because of the benefits of the computer. Not all of the members of the family experience the technology gains, but instead have gains in happiness.

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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.

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Always Sunny — Frank the Art Collector

 

Frank poses as an art collector to try and convince the art gallery owner that a really bad piece is actually really valuable. This clip is a great segue into subjective value and preferences of individuals.

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The Simpsons — No Diminishment for Homer

Homer and Marge head to the Frying Dutchman for the all-you-can-eat buffet. Heading late into the night, Homer doesn’t seem to be experiencing any diminishing returns even after eating all of the shrimp and two plastic lobsters. Even though he isn’t experiencing diminishing returns, Homer appears to be optimizing his utility since the marginal cost of each plate (and each plastic lobster) is $0.

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Parks & Recreation: Diminishing Returns of Shrimp

This great, short clip comes from one of my principle’s students, Caitlin, this year.

While at an engagement party for Leslie and Ben, Chris starts to experience extreme mood swings and sadness because he’s lonely. Anne tries to cheer him up by bringing him a platter of shrimp. Chris takes a bite of the shrimp and exclaims “That’s amazing” then after taking another bite he says “This one’s not as good.”

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