Teaching Economics with Media
In this Stossel segment, we learn about the history of the De Beers diamond corporation and their control of the diamond market. Stossel interviews guests and asks them to identify diamonds from knock-off rings, but most can’t tell the difference despite claiming to be capable.
One of the textbook examples of monopoly power comes from De Beers Diamond Corporation and their control over the diamond markets since the end of the Great Depression. In this short scene, Adam Conover covers the history on engagement rings and discusses the monopoly power that the De Beers company had in the market.
Adam Ruins Everything is a half-hour informational comedy were host, Adam Conover, debunks popular myths. Each episode is divided into 3 segments with some common theme. In the Spring of 2018, James Tierney and I sat down to go through all three seasons of Adam Ruins Everything to pick out examples in each episode that could be used in an economics course. If you’re curious about the paper, you can read about it here.
Colleen and Matt are back from their wedding, but they haven’t written any thank you cards. Joan tries to drop hints by buying them thank you cards, but now she’s gotten to the point of just telling them they need to write thank you cards. Colleen realizes they need to do this because they want gifts later for their baby shower. This self-interest has sparked an idea! While it may be fair to write each person an individual card, Colleen and Matt realize it’s much more efficient to make a thank you video that people can share. The gesture isn’t well received at brunch. Often, improvements in efficiency (in this case making a video and saving the couple time) come at the cost of equity (many family members feel this isn’t fair).
It takes a lot of courage to propose to your partner in front of thousands of on-lookers and most of the time the answer, at least in public, is a solid “yes,” but this individual wasn’t so lucky. This clip is a good opening clip to use for opportunity costs, which is the value of the next best alternative. For the young lady, she quickly considered life with her partner and realized that the opportunity cost outweighed the benefit.
If you were the young man proposing, what would you rather be doing at that moment than what he’s going through? Instead of purchasing the engagement ring (average of $6000 in the US), what would you have spent that money on?
Thanks to Greg Caskey for the suggestion!
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.
A great look from Vox on the asymmetric information involved in the wedding industry.