But I'm teaching Managerial Econ for the 2010 EMBA class this summer, so I'll of course be thinking about some managerial econ ideas over the next ten weeks. And here's one thing that strikes me every time I cover the material about where demand curves come from: Journalists love --- love! --- to write about shifting demand curves.
Remember last summer when gas prices were so high? Every time you opened a newspaper (yes, I'm old-fashioned), there was a story about how people were changing their behavior because of high gas prices. People increased their demand for hybrids, bus passes, and city-center apartments, and reduced their demand for hummers and houses in exurbia.
And here's the latest from the NYT:
Yes, I Look Fabulous, But Inside I'm Saving
Even Hollywood A-listers are reducing demand for certain goods and services now that everyone's 401k is 40% down from last summer. Why, Alice Cooper's bass player parks his own car rather than paying $10 for the valet.
For most goods, we reduce our consumption when our income falls. But falling income leads to hard choices, and these are the sort of choices that attract journalists. This article focuses on how Hollywood-types are reducing spending on status goods only a little, but are cutting back more on goods that don't convey status. One exec canceled her vacation but still splurged in an Audi A5. Apparently nobody can tell whether you went to Fiji or Fresno over spring break, but tongues wag over your sporty new ride.
This article was in the Times The Arts section, which just goes to show that you can find cool economics pretty much anywhere you look.
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