1 00:00:08,080 --> 00:00:11,000 Speaker 1: Hello, and welcome to another edition of Odd Thoughts. I'm 2 00:00:11,039 --> 00:00:14,720 Speaker 1: Tracy Alloway, Executive editor of Bloomberg Markets, and I'm Joe 3 00:00:14,760 --> 00:00:18,720 Speaker 1: wi isn't All Managing editor of Bloomberg Markets. So, Joe, 4 00:00:19,120 --> 00:00:23,880 Speaker 1: did you ever watch Seinfeld? Of course I wasn't a 5 00:00:23,920 --> 00:00:26,440 Speaker 1: mega fan like a lot of people I knew then. 6 00:00:26,520 --> 00:00:28,960 Speaker 1: But of course by now I've probably seen all that 7 00:00:29,200 --> 00:00:33,599 Speaker 1: most of the episodes, at least one who hasn't, Right, So, 8 00:00:33,760 --> 00:00:36,560 Speaker 1: I think almost anytime you flick on the TV there 9 00:00:36,600 --> 00:00:38,800 Speaker 1: seemed to be some sort of reruns running. It was 10 00:00:38,840 --> 00:00:44,120 Speaker 1: a hugely, hugely popular show of famously about nothing. Um, 11 00:00:44,159 --> 00:00:47,839 Speaker 1: but you do like economics, right? Wait? Is today's podcast 12 00:00:47,800 --> 00:00:51,360 Speaker 1: is going to be about nothing? No? No, today's podcast 13 00:00:51,400 --> 00:00:54,600 Speaker 1: is I guess going to be about the economics of nothing. 14 00:00:56,280 --> 00:00:59,959 Speaker 1: I'm looking That sounds really uh, that sounds really good 15 00:01:00,000 --> 00:01:02,880 Speaker 1: and I'm excited about that. All right, Well, what I'm 16 00:01:02,920 --> 00:01:08,240 Speaker 1: referring to is there's a website that's actually called Seinfeld Economics, 17 00:01:08,360 --> 00:01:10,440 Speaker 1: and we are going to speak with one of the 18 00:01:10,480 --> 00:01:13,360 Speaker 1: guys behind it. He is Alan Grant. He is an 19 00:01:13,360 --> 00:01:18,200 Speaker 1: associate professor of economics at Baker University and this site, Joe, 20 00:01:18,280 --> 00:01:21,600 Speaker 1: if you hadn't had a chance to look yet. It's 21 00:01:21,920 --> 00:01:25,400 Speaker 1: pretty great. I think it kind of cuts all these 22 00:01:25,400 --> 00:01:29,720 Speaker 1: clips from Seinfeld and then uh relates them to a 23 00:01:29,800 --> 00:01:33,160 Speaker 1: certain economic concept. So, for instance, they're little clips that 24 00:01:33,200 --> 00:01:39,800 Speaker 1: are tied into game theory, clips about common resources, demand, substitutes, 25 00:01:40,000 --> 00:01:44,120 Speaker 1: all that good economic stuff. I was browsing through the 26 00:01:44,160 --> 00:01:47,240 Speaker 1: site earlier and I saw and I thought it was 27 00:01:47,319 --> 00:01:51,320 Speaker 1: hilarious and brilliant, and I'm very excited about talking talking 28 00:01:51,320 --> 00:01:54,280 Speaker 1: with Alan. Alright, well, let's let's not wait any longer. 29 00:01:54,360 --> 00:02:05,800 Speaker 1: Let's bring him in. So Alan, I suppose the first 30 00:02:05,880 --> 00:02:10,520 Speaker 1: question is why Seinfeld? And how did this actually get started? 31 00:02:10,560 --> 00:02:16,040 Speaker 1: The economics of Seinfeld. Uh, this got started probably in 32 00:02:16,440 --> 00:02:20,119 Speaker 1: two thousand six or two thousand seven, And at that 33 00:02:20,200 --> 00:02:23,919 Speaker 1: time pop culture really wasn't a big deal in economics. UM. 34 00:02:23,960 --> 00:02:26,120 Speaker 1: But in two thousand and six a guy named Dirk Mateer, 35 00:02:26,200 --> 00:02:28,560 Speaker 1: who is now a professor at the University of Arizona, 36 00:02:28,720 --> 00:02:31,800 Speaker 1: published a book called Economics in the Movies, and that 37 00:02:31,880 --> 00:02:35,400 Speaker 1: really kind of got people thinking about what can we 38 00:02:35,520 --> 00:02:38,680 Speaker 1: bring from the things that our students know into the 39 00:02:38,720 --> 00:02:42,280 Speaker 1: classroom so that we can make economics more relevant to them. 40 00:02:42,360 --> 00:02:46,320 Speaker 1: And so my my co workers at Eastern Illinois, and 41 00:02:46,360 --> 00:02:49,320 Speaker 1: I kicked around ideas and we were using clips in 42 00:02:49,360 --> 00:02:52,919 Speaker 1: the classroom, and I kind of thought to myself, what's 43 00:02:52,960 --> 00:02:56,000 Speaker 1: more popular, what's a more common touch point than the 44 00:02:56,000 --> 00:03:01,120 Speaker 1: TV series Seinfeld? And so I did my wife called 45 00:03:01,360 --> 00:03:04,600 Speaker 1: research for the next couple of months, um digging through 46 00:03:04,720 --> 00:03:07,440 Speaker 1: all of the back episodes on DVD. Seinfeld was off 47 00:03:07,480 --> 00:03:11,280 Speaker 1: the air by this time, looking for compiling a database 48 00:03:11,360 --> 00:03:14,400 Speaker 1: of Seinfeld clips that would be useful for economics instructors. 49 00:03:15,040 --> 00:03:19,320 Speaker 1: Did you literally watch every episode on your on your jag? 50 00:03:20,080 --> 00:03:23,079 Speaker 1: I did watch every single episode on my jag. I 51 00:03:23,240 --> 00:03:25,440 Speaker 1: start the morning with two or three episodes when I 52 00:03:25,480 --> 00:03:27,400 Speaker 1: got into the office, and I finished the day with 53 00:03:27,440 --> 00:03:30,400 Speaker 1: a few more episodes. And I got lots and lots 54 00:03:30,400 --> 00:03:33,440 Speaker 1: of mocking for my wife about this. So one of 55 00:03:33,480 --> 00:03:35,560 Speaker 1: the things I love about the fact that you chose 56 00:03:35,640 --> 00:03:39,520 Speaker 1: Seinfeld is it is the show again about nothing. It's 57 00:03:39,600 --> 00:03:42,000 Speaker 1: just a sort of group of friends living in New York. 58 00:03:42,200 --> 00:03:44,080 Speaker 1: Not that much happens to them, and it just goes 59 00:03:44,120 --> 00:03:46,400 Speaker 1: through their daily life, which means that you end up 60 00:03:46,400 --> 00:03:52,160 Speaker 1: getting to relate some really banal, ordinary events to economics. 61 00:03:52,480 --> 00:03:56,200 Speaker 1: Can you maybe give us some examples? Absolutely, I'd be 62 00:03:56,240 --> 00:03:59,000 Speaker 1: happy to. One of my favorite episodes for what It's 63 00:03:59,000 --> 00:04:03,640 Speaker 1: Worth is an episode about Jerry and Elaine, who rekindled 64 00:04:03,640 --> 00:04:08,920 Speaker 1: their romance. The episode is called The Deal, and Elaine 65 00:04:09,040 --> 00:04:11,840 Speaker 1: is very into the romance and Jerry is kind of 66 00:04:11,880 --> 00:04:14,760 Speaker 1: like lots of guys who don't understand exactly what it 67 00:04:14,800 --> 00:04:18,320 Speaker 1: is that women want to appreciate, and he decides that 68 00:04:18,360 --> 00:04:20,880 Speaker 1: instead of giving her a gift that she won't like, 69 00:04:21,640 --> 00:04:28,800 Speaker 1: he decides to give her some cash instead. Cash. You 70 00:04:28,920 --> 00:04:31,240 Speaker 1: got me cash, Well, that's right for you need to 71 00:04:31,320 --> 00:04:34,200 Speaker 1: go out and get yourself whatever you want. No good 72 00:04:35,440 --> 00:04:38,720 Speaker 1: you might uncle might come on talking about two dollars there. 73 00:04:38,720 --> 00:04:41,599 Speaker 1: I don't think that's a I think this NASA. We 74 00:04:41,640 --> 00:04:44,440 Speaker 1: have a thread in the literature, in the economics literature 75 00:04:44,440 --> 00:04:47,479 Speaker 1: about the deadweight loss of Christmas, about how people give 76 00:04:47,560 --> 00:04:50,159 Speaker 1: gifts and spend far more money on gifts than the 77 00:04:50,240 --> 00:04:55,200 Speaker 1: recipients would actually actually spend for themselves. And it turns 78 00:04:55,240 --> 00:04:58,320 Speaker 1: out the conclusion from that threat of the literature is 79 00:04:58,400 --> 00:05:01,160 Speaker 1: cash is a really great gift. But the conclusion from 80 00:05:01,200 --> 00:05:04,320 Speaker 1: Seinfeld is, oh, yeah, there are feelings involved, and people 81 00:05:04,360 --> 00:05:07,400 Speaker 1: want to feel appreciated, and it's sometimes it really is 82 00:05:07,440 --> 00:05:10,159 Speaker 1: the thought that counts. I like that you've immediately homed 83 00:05:10,160 --> 00:05:13,080 Speaker 1: in on this episode because this whole question of gift 84 00:05:13,120 --> 00:05:16,919 Speaker 1: giving and the utility of gift giving, this is always 85 00:05:16,960 --> 00:05:20,719 Speaker 1: this always comes up among economists, doesn't it in terms 86 00:05:20,760 --> 00:05:24,400 Speaker 1: of this sort of classic example where economists say that 87 00:05:24,760 --> 00:05:27,799 Speaker 1: people do something irrational and that there's a better way 88 00:05:27,839 --> 00:05:31,839 Speaker 1: to do this. Um uh, this common everyday thing. Agreed, 89 00:05:32,680 --> 00:05:34,920 Speaker 1: we spend a lot of time, and over the past 90 00:05:35,120 --> 00:05:37,360 Speaker 1: five or six years, we spent a lot of time 91 00:05:37,400 --> 00:05:39,880 Speaker 1: debating whether gift giving is a rational thing or whether 92 00:05:39,960 --> 00:05:42,000 Speaker 1: it's just better to give the gift of cash and 93 00:05:42,080 --> 00:05:44,640 Speaker 1: let the recipient pick what they really want for themselves 94 00:05:44,880 --> 00:05:46,880 Speaker 1: on the flip side, And I don't want to delve 95 00:05:46,920 --> 00:05:49,680 Speaker 1: too much into this question because I want to talk 96 00:05:49,720 --> 00:05:53,240 Speaker 1: about the Seinfeld episodes. But this is also an example 97 00:05:53,400 --> 00:05:58,360 Speaker 1: of why people say that economists don't really understand human nature, 98 00:05:58,440 --> 00:06:01,240 Speaker 1: and so an economist might look it a perfectly rational 99 00:06:01,320 --> 00:06:03,800 Speaker 1: person and say you should appreciate the cash and get 100 00:06:03,839 --> 00:06:06,680 Speaker 1: what you want. But maybe rather than that being an 101 00:06:06,680 --> 00:06:11,600 Speaker 1: example of humans being irrational, it's economists thinking of humans 102 00:06:11,680 --> 00:06:15,800 Speaker 1: as these perfect homo economical ASTs as opposed to what 103 00:06:16,240 --> 00:06:21,560 Speaker 1: makes this human absolutely, And this is an important lesson 104 00:06:21,640 --> 00:06:24,000 Speaker 1: for our students, I think too, because we spend a 105 00:06:24,000 --> 00:06:26,200 Speaker 1: lot of time on the blackboard, and we developed these 106 00:06:26,400 --> 00:06:30,080 Speaker 1: sort of models that assume everybody behaves rationally, and that 107 00:06:30,120 --> 00:06:34,600 Speaker 1: works pretty well most of the time, but a significant 108 00:06:34,640 --> 00:06:36,840 Speaker 1: amount of the time your students sort of raised their 109 00:06:36,839 --> 00:06:41,440 Speaker 1: hands and go, yeah, but what if, um have you 110 00:06:41,520 --> 00:06:45,960 Speaker 1: considered this? And the Seinfeld episode that I just spoke 111 00:06:46,000 --> 00:06:48,960 Speaker 1: about the deal really brings in one of those what ifs, 112 00:06:49,080 --> 00:06:51,240 Speaker 1: what if the thought really does count, what if it 113 00:06:51,279 --> 00:06:54,320 Speaker 1: really matters? And so it helps us take these blackboard 114 00:06:54,360 --> 00:06:56,359 Speaker 1: ideas and say they work a lot of the time, 115 00:06:56,720 --> 00:07:01,280 Speaker 1: but not always. So is it that TV shows like 116 00:07:01,360 --> 00:07:05,200 Speaker 1: Seinfeld are good at illustrating the concepts, or that they're 117 00:07:05,240 --> 00:07:08,160 Speaker 1: good at illustrating the limitations of the concepts, Because a 118 00:07:08,240 --> 00:07:10,040 Speaker 1: lot of the examples that you do have up on 119 00:07:10,040 --> 00:07:15,560 Speaker 1: the site are about economics not working up perfectly as envisioned. 120 00:07:16,640 --> 00:07:20,480 Speaker 1: I think there is a lot to be said about 121 00:07:20,520 --> 00:07:23,920 Speaker 1: that that economics does not always work perfectly. It's very 122 00:07:23,920 --> 00:07:27,880 Speaker 1: good at explaining the behavior of groups, but less useful 123 00:07:27,920 --> 00:07:32,440 Speaker 1: in explaining the behavior of individuals. But that's an extra 124 00:07:32,560 --> 00:07:35,200 Speaker 1: layer of complexity that we try, at least in the 125 00:07:35,240 --> 00:07:39,640 Speaker 1: classroom for freshman sophomores, we try to filter out those complexities. 126 00:07:39,760 --> 00:07:41,600 Speaker 1: And I think there's a lot to be found in 127 00:07:41,640 --> 00:07:46,720 Speaker 1: Seinfeld that really does illustrate sort of classical economic theory 128 00:07:46,920 --> 00:07:49,280 Speaker 1: that people do most of the time behave in a 129 00:07:49,320 --> 00:07:53,400 Speaker 1: self interested fashion. Seinfeld is wonderful for that, by the way, 130 00:07:53,440 --> 00:07:59,640 Speaker 1: because your four characters, George, Jerry, Elaine, and Cramer, they 131 00:07:59,640 --> 00:08:04,040 Speaker 1: are very self interested individuals. Yeah, I'm looking at another 132 00:08:04,080 --> 00:08:08,800 Speaker 1: one on your website, the episode The Big Salad, which 133 00:08:08,840 --> 00:08:12,760 Speaker 1: I actually don't remember having seen before, but I like 134 00:08:12,880 --> 00:08:18,000 Speaker 1: the concept and it talks about the sort of fallacy 135 00:08:18,160 --> 00:08:21,440 Speaker 1: or of pure altruism. I guess tell us about this 136 00:08:21,520 --> 00:08:24,040 Speaker 1: episode because I think this, uh, the description on your 137 00:08:24,080 --> 00:08:28,120 Speaker 1: website really gets at kind of how flawed humans, and 138 00:08:28,160 --> 00:08:32,680 Speaker 1: in particular the Seinfeld characters are. Yes so so. In 139 00:08:32,760 --> 00:08:37,680 Speaker 1: The Big Salad, Elaine is hungry and she asks George 140 00:08:37,679 --> 00:08:40,360 Speaker 1: to go out and get her a big salad from 141 00:08:40,800 --> 00:08:46,960 Speaker 1: monkst the cafeteria downstairs. And so George at this time 142 00:08:47,040 --> 00:08:50,520 Speaker 1: is dating somebody and his girlfriend pops down and picks 143 00:08:50,600 --> 00:08:54,640 Speaker 1: up the salad, but takes credit for getting the salad 144 00:08:54,640 --> 00:08:56,400 Speaker 1: when really it was George that sort of put the 145 00:08:56,400 --> 00:09:06,480 Speaker 1: bill for that, and George gets really crazy about this problem. 146 00:09:06,520 --> 00:09:10,280 Speaker 1: Here's your big salad. Thank you, Julie. Oh you're very welcome. 147 00:09:13,559 --> 00:09:17,800 Speaker 1: Did you see what just happened? Well, that all depends 148 00:09:19,280 --> 00:09:21,719 Speaker 1: happened to notice that Julie handed the big salad to 149 00:09:21,800 --> 00:09:26,400 Speaker 1: a lane. Yeah, so, well she didn't buy the big salad. 150 00:09:26,520 --> 00:09:31,480 Speaker 1: I bought the big seal, Yes it is. She just 151 00:09:31,480 --> 00:09:35,280 Speaker 1: took credit from my selling. That's not right, No, it don't. 152 00:09:35,440 --> 00:09:37,160 Speaker 1: I mean I'm the one that bought it. Yes, you did. 153 00:09:37,320 --> 00:09:39,440 Speaker 1: Don't you think she should have said something? She could not. 154 00:09:40,720 --> 00:09:44,200 Speaker 1: So he's happy to get the salad free Lane, but 155 00:09:44,280 --> 00:09:46,480 Speaker 1: he wants some of the credit for it as well. 156 00:09:46,920 --> 00:09:49,320 Speaker 1: He gets some satisfaction out of knowing that not only 157 00:09:49,360 --> 00:09:53,719 Speaker 1: did I give the gift, but I'm being appreciated for it. So, 158 00:09:54,559 --> 00:09:58,360 Speaker 1: you know, perfectly rational context, you should be able to 159 00:09:58,400 --> 00:10:01,280 Speaker 1: give a gift, you should feel good about giving the gift, 160 00:10:01,400 --> 00:10:04,959 Speaker 1: but but to be truthful about it. A lot of 161 00:10:05,000 --> 00:10:06,920 Speaker 1: the times, and we see this at the university all 162 00:10:06,920 --> 00:10:09,400 Speaker 1: the time, people want their name attached to their gift. 163 00:10:09,760 --> 00:10:13,480 Speaker 1: They get some satisfaction from getting credit for those things, right, 164 00:10:13,640 --> 00:10:16,520 Speaker 1: ego driven people. You see it in the workplace all 165 00:10:16,559 --> 00:10:18,600 Speaker 1: the time. I think that things that seem like they 166 00:10:18,600 --> 00:10:21,600 Speaker 1: should be arbitrary end up mattering quite a bit too 167 00:10:21,600 --> 00:10:25,400 Speaker 1: people they do. UM. I mentioned that we have this 168 00:10:25,440 --> 00:10:28,920 Speaker 1: at the university. This is a trend in university giving 169 00:10:28,960 --> 00:10:32,760 Speaker 1: across the country is that we have donors that want 170 00:10:32,760 --> 00:10:35,440 Speaker 1: their names attached to new buildings and donors that want 171 00:10:35,480 --> 00:10:38,680 Speaker 1: their names attached to new facilities. And it's gotten down 172 00:10:38,679 --> 00:10:40,959 Speaker 1: to the level that if you visit the right campuses, 173 00:10:41,040 --> 00:10:44,520 Speaker 1: you can find donors who have donated urinals and toilets 174 00:10:44,559 --> 00:10:46,560 Speaker 1: with a little plaque above every time you go to 175 00:10:46,559 --> 00:10:49,120 Speaker 1: the party. That's amazing. I would do that. I think 176 00:10:49,160 --> 00:10:52,560 Speaker 1: that'd be great. What are some episodes or particular episode 177 00:10:52,720 --> 00:10:58,480 Speaker 1: that teaches about game theory. My favorite episode about game 178 00:10:58,520 --> 00:11:02,719 Speaker 1: theory as an episode called the pees Dispenser. And I 179 00:11:02,760 --> 00:11:06,280 Speaker 1: don't know if you remember the Peest Dispenser episode or not, um, 180 00:11:06,760 --> 00:11:11,959 Speaker 1: but in that episode, George is dating a concert pianist 181 00:11:12,640 --> 00:11:15,760 Speaker 1: and he's worried because George is horribly neurotic and insecure, 182 00:11:16,280 --> 00:11:21,600 Speaker 1: and Noel, the concert pianist is very confident, poised, self assured, 183 00:11:22,080 --> 00:11:24,680 Speaker 1: and George is just certain that he's going to get dumped, 184 00:11:25,920 --> 00:11:30,319 Speaker 1: and Kramer convinces him to do something that's very strategic. 185 00:11:31,320 --> 00:11:35,840 Speaker 1: He convinces George to stage a preemptive breakup. But he's 186 00:11:35,880 --> 00:11:39,880 Speaker 1: going to break up with Noel, and if she accepts that, 187 00:11:40,160 --> 00:11:44,160 Speaker 1: then the relationship was probably going to go down the 188 00:11:44,200 --> 00:11:48,960 Speaker 1: tubes anyway. But it also has the possibility of evoking 189 00:11:48,960 --> 00:11:51,720 Speaker 1: a response where Noel could say, oh my gosh, you 190 00:11:51,720 --> 00:11:53,720 Speaker 1: want to break up with me, I better step up 191 00:11:53,720 --> 00:11:56,600 Speaker 1: my game and take better care of you. And so 192 00:11:56,720 --> 00:11:59,080 Speaker 1: in game theory, we have something called a dominant strategy. 193 00:11:59,280 --> 00:12:02,760 Speaker 1: It's always the best response to whatever your opponent might 194 00:12:02,760 --> 00:12:08,800 Speaker 1: be doing. I've got nothing to lose. Will you the 195 00:12:08,880 --> 00:12:10,880 Speaker 1: break up, which she would do anyway, but at least 196 00:12:10,920 --> 00:12:13,840 Speaker 1: I go out with some dignity or I completely turned 197 00:12:13,880 --> 00:12:20,520 Speaker 1: the tables. This is absolutely brilliant, and Kramer convinces George 198 00:12:20,600 --> 00:12:23,880 Speaker 1: that this preemptive breakup is a dominant strategy that no 199 00:12:23,960 --> 00:12:26,760 Speaker 1: matter where the relationship has headed, whether it's going fine 200 00:12:26,840 --> 00:12:29,400 Speaker 1: or going poorly, George needs to break up with Noel. 201 00:12:29,800 --> 00:12:32,640 Speaker 1: He can't make himself any worse off. He can make 202 00:12:32,679 --> 00:12:36,640 Speaker 1: himself better off. You're breaking up with me, I really 203 00:12:36,720 --> 00:12:40,840 Speaker 1: am ever expected this? Did you? I thought Everything's fine. 204 00:12:41,559 --> 00:12:46,439 Speaker 1: Let learn. So I don't want to give the impression 205 00:12:46,480 --> 00:12:50,400 Speaker 1: that you're only about Seinfeld episodes and economics, because Joe 206 00:12:50,400 --> 00:12:53,200 Speaker 1: and I have also heard that you're into other TV 207 00:12:53,360 --> 00:12:58,040 Speaker 1: shows as illustrations of economic concepts. Tell us which ones 208 00:12:58,080 --> 00:13:02,160 Speaker 1: you think lend themselves well to the serena. So I 209 00:13:02,280 --> 00:13:05,520 Speaker 1: use lots of movie clips from old movies. I use 210 00:13:05,640 --> 00:13:11,200 Speaker 1: lots of television shows. Um, there are some outstanding resources 211 00:13:11,240 --> 00:13:14,079 Speaker 1: available for economists that want to bring this into the classroom. 212 00:13:14,760 --> 00:13:16,920 Speaker 1: I use a few clips from the Wire, which is 213 00:13:16,960 --> 00:13:21,280 Speaker 1: about the drug market in Baltimore. Um. Always good to right, 214 00:13:21,440 --> 00:13:24,839 Speaker 1: be exploring at a market that is largely unregulated because 215 00:13:24,840 --> 00:13:27,920 Speaker 1: it's an illicit market. Sorry, I seem to remember in 216 00:13:28,000 --> 00:13:31,480 Speaker 1: one of the first season's a main character actually takes 217 00:13:31,600 --> 00:13:35,400 Speaker 1: an economics course, right, a drug dealer. Yes, this is 218 00:13:35,440 --> 00:13:39,840 Speaker 1: a wonderful clip. Um, Stringer Bell drug kingpin in training, 219 00:13:40,080 --> 00:13:42,640 Speaker 1: is going back to college to get a business degree 220 00:13:42,720 --> 00:13:44,880 Speaker 1: so that he can run his drug empire like a 221 00:13:44,880 --> 00:13:50,439 Speaker 1: business instead of like a right sort of streethood and uh, 222 00:13:50,480 --> 00:13:52,640 Speaker 1: and they have a wonderful clip in there about the 223 00:13:52,679 --> 00:13:57,720 Speaker 1: elasticity of demand, about consumers price sensitivity um T changes 224 00:13:57,760 --> 00:14:00,920 Speaker 1: in price, and the things that may consumers more or 225 00:14:01,000 --> 00:14:05,040 Speaker 1: less price sensitive. Look, you're not gonna go in that corner. 226 00:14:05,120 --> 00:14:09,560 Speaker 1: Bullsto up in here, you hear me. You know what 227 00:14:09,640 --> 00:14:12,520 Speaker 1: we got here? We got an elastic product. You know 228 00:14:12,520 --> 00:14:15,599 Speaker 1: what that means. That means when people can go elsewhere 229 00:14:15,679 --> 00:14:18,040 Speaker 1: and get their print in and copy and done, they're 230 00:14:18,080 --> 00:14:19,920 Speaker 1: going to do it. You acting like we got an 231 00:14:19,920 --> 00:14:23,640 Speaker 1: an elastic products and we don't know. I won't because 232 00:14:23,680 --> 00:14:29,640 Speaker 1: to the truth the business, not no front, not no bulls. 233 00:14:31,120 --> 00:14:33,240 Speaker 1: It's a terrific clip. It's one that I continue to 234 00:14:33,280 --> 00:14:36,960 Speaker 1: show semester after semester, and students continue to respond well 235 00:14:37,040 --> 00:14:40,920 Speaker 1: to it. Are there any other particular I mean that 236 00:14:41,120 --> 00:14:44,840 Speaker 1: that show is filled with lessons I imagine about the 237 00:14:44,880 --> 00:14:52,040 Speaker 1: economics and how economics applies to unregulated criminal um industries. 238 00:14:52,080 --> 00:14:54,840 Speaker 1: But are there any other particular episodes of that show 239 00:14:54,920 --> 00:15:00,120 Speaker 1: that really strike you as stating something profound um that 240 00:15:00,640 --> 00:15:05,400 Speaker 1: about economics. So one of the things that is really 241 00:15:05,440 --> 00:15:08,400 Speaker 1: profound about that episode is the idea, and this is 242 00:15:08,440 --> 00:15:11,880 Speaker 1: a first day lesson for most students of economics. The 243 00:15:11,960 --> 00:15:15,640 Speaker 1: idea of opportunity cost is that when you have a 244 00:15:15,680 --> 00:15:18,920 Speaker 1: group of individuals, or when you have an individual who 245 00:15:18,920 --> 00:15:24,120 Speaker 1: has little outside opportunity, UM, they will gravitate towards their 246 00:15:24,120 --> 00:15:28,200 Speaker 1: best opportunity. Right. And so, as it turns out, I 247 00:15:28,280 --> 00:15:31,560 Speaker 1: have this choice of dealing drugs, and the only thing 248 00:15:31,600 --> 00:15:33,920 Speaker 1: that I really lose when I choose to join the 249 00:15:34,000 --> 00:15:36,600 Speaker 1: drug gang is the opportunity to work at McDonald's because 250 00:15:36,600 --> 00:15:39,600 Speaker 1: of a lack of education, a lack of job training. 251 00:15:39,920 --> 00:15:42,440 Speaker 1: In fact, season four of The Wire is devoted to 252 00:15:43,000 --> 00:15:46,240 Speaker 1: sort of the deplorable condition of Baltimore inner city schools. 253 00:15:46,280 --> 00:15:50,320 Speaker 1: That helps explain, I think, in large part, why exactly 254 00:15:50,920 --> 00:15:55,120 Speaker 1: these individuals choose to join the drug gang and deal drugs. So, Alan, 255 00:15:55,320 --> 00:15:58,880 Speaker 1: you've obviously been doing this for a long time, and 256 00:15:59,080 --> 00:16:01,280 Speaker 1: over the past dec eight or so, we have seen 257 00:16:01,520 --> 00:16:06,560 Speaker 1: the rise of economics being entwined with pop culture, and 258 00:16:06,600 --> 00:16:10,400 Speaker 1: we've seen the freakonomics phenomenon and lots of imitators based 259 00:16:10,440 --> 00:16:14,520 Speaker 1: off of that. How useful is it? How useful have 260 00:16:14,600 --> 00:16:18,000 Speaker 1: you found it in practice to show economics through the 261 00:16:18,040 --> 00:16:24,280 Speaker 1: prism of pop culture and specifically television and movies. I 262 00:16:24,320 --> 00:16:28,200 Speaker 1: think it's been very useful. Um. Economics has been a 263 00:16:28,280 --> 00:16:31,840 Speaker 1: blackboard science at the undergraduate level with lots of graphs, 264 00:16:31,880 --> 00:16:34,160 Speaker 1: and it turns out that lots of students aren't very 265 00:16:34,160 --> 00:16:38,360 Speaker 1: good in graphs. Um. There are lots of really restrictive models, 266 00:16:38,400 --> 00:16:42,960 Speaker 1: and they're abstract, and the typical student really doesn't glom 267 00:16:43,000 --> 00:16:45,520 Speaker 1: onto the subtle points as well as we would like 268 00:16:45,720 --> 00:16:48,960 Speaker 1: them too. And so if you want to keep your 269 00:16:48,960 --> 00:16:51,160 Speaker 1: students sort of passionate about the subject, you have to 270 00:16:51,200 --> 00:16:54,520 Speaker 1: make it useful to them. And starting with Dirk Mateers 271 00:16:54,520 --> 00:16:57,160 Speaker 1: book on Economics in the Movies in two thousand and six, 272 00:16:57,760 --> 00:17:02,000 Speaker 1: we've had a group of really an economists devote themselves 273 00:17:02,080 --> 00:17:06,959 Speaker 1: to taking blackboard economics and making it useful to students. UH. 274 00:17:07,240 --> 00:17:10,040 Speaker 1: If I can give an anecdotal example of that, I 275 00:17:10,040 --> 00:17:13,000 Speaker 1: talked earlier about the clip from the Wire, Uh, and 276 00:17:13,080 --> 00:17:16,440 Speaker 1: you had actually mentioned the clip where Stringer Bell goes 277 00:17:16,480 --> 00:17:18,400 Speaker 1: back to college to learn how to run a business. 278 00:17:19,560 --> 00:17:22,280 Speaker 1: So I had a lower tail student. She was not 279 00:17:22,320 --> 00:17:24,960 Speaker 1: a very good student. UM. She ended up dropping the 280 00:17:24,960 --> 00:17:27,840 Speaker 1: class about halfway through and moving to Morocco. She was 281 00:17:27,880 --> 00:17:30,240 Speaker 1: a little bit flaky and Wright wanted to travel the 282 00:17:30,240 --> 00:17:33,040 Speaker 1: world instead of going to college. But when she came back, 283 00:17:34,119 --> 00:17:37,640 Speaker 1: she asked if she could get into my overlea full class, 284 00:17:38,000 --> 00:17:41,679 Speaker 1: and she said, you know what, it really made an 285 00:17:41,680 --> 00:17:43,919 Speaker 1: impression on me when you showed the clip from the 286 00:17:43,920 --> 00:17:47,720 Speaker 1: wire in class about the elasticity of demand. And here's 287 00:17:47,720 --> 00:17:51,960 Speaker 1: a student that is a d student and she remembers 288 00:17:52,000 --> 00:17:54,320 Speaker 1: not only the clip, but she remembers the concept the 289 00:17:54,320 --> 00:17:57,600 Speaker 1: clip was supposed to illustrate. And so I think the 290 00:17:57,680 --> 00:18:00,640 Speaker 1: idea of pop culture is that if you choose your 291 00:18:00,680 --> 00:18:04,040 Speaker 1: resources really carefully, you can make an impact on students 292 00:18:04,040 --> 00:18:06,440 Speaker 1: who might otherwise just sit in the background and be lost. 293 00:18:06,920 --> 00:18:10,639 Speaker 1: That is cool that that actually works and resonates. I 294 00:18:10,720 --> 00:18:15,000 Speaker 1: was gonna ask, to some extent, can you find an 295 00:18:15,000 --> 00:18:19,840 Speaker 1: economics lesson in any television show period, any episode of 296 00:18:19,880 --> 00:18:24,520 Speaker 1: any television show, just because all dramas essentially about human 297 00:18:24,560 --> 00:18:28,480 Speaker 1: decision making, and all human decision making can be boiled 298 00:18:28,520 --> 00:18:34,960 Speaker 1: down to economics. I think that you probably can find 299 00:18:35,000 --> 00:18:37,680 Speaker 1: economic content and almost in a show that you want 300 00:18:37,720 --> 00:18:42,000 Speaker 1: to watch. But I think the economic content that comes 301 00:18:42,000 --> 00:18:44,119 Speaker 1: out and reaches to your undergraduates and just sort of 302 00:18:44,119 --> 00:18:46,000 Speaker 1: slaps them in the face and says, oh, this is 303 00:18:46,000 --> 00:18:48,480 Speaker 1: a very clear illustration of what we've been doing. That's 304 00:18:48,520 --> 00:18:52,560 Speaker 1: a little bit harder to search for um. So Seinfeld 305 00:18:52,640 --> 00:18:59,160 Speaker 1: was on for how many seasons? Nine seasons? And out 306 00:18:59,200 --> 00:19:02,320 Speaker 1: of nine season and several hundred episodes, I think we 307 00:19:02,400 --> 00:19:07,360 Speaker 1: have about one hundred short to the point um concise 308 00:19:07,400 --> 00:19:13,240 Speaker 1: clips that fairly clearly illustrate general economic principles. So you know, 309 00:19:13,280 --> 00:19:16,280 Speaker 1: about one out of every two episodes of Seinfeld. Other 310 00:19:16,320 --> 00:19:19,720 Speaker 1: shows maybe not so much. All right, well, I personally 311 00:19:19,760 --> 00:19:23,000 Speaker 1: can't wait for the economics of Game of Thrones. That'll 312 00:19:23,040 --> 00:19:26,920 Speaker 1: be that'll be a good one. That'll be fantastic. It's 313 00:19:26,920 --> 00:19:30,320 Speaker 1: a great show and a great series of books. Alan Grant, 314 00:19:30,400 --> 00:19:32,920 Speaker 1: thank you so much for joining us today. It's been 315 00:19:32,960 --> 00:19:47,640 Speaker 1: my pleasure. Thank you for the chance to to talk today, Tracy. 316 00:19:47,840 --> 00:19:50,960 Speaker 1: I really loved that episode. I want to go back 317 00:19:51,000 --> 00:19:54,320 Speaker 1: and watch a bunch of old seinfelds now through the 318 00:19:54,359 --> 00:19:57,480 Speaker 1: prism of economics. Will you be taking like economics notes 319 00:19:57,520 --> 00:20:00,960 Speaker 1: while you do it? No, I probably we won't. But 320 00:20:01,080 --> 00:20:05,400 Speaker 1: I really I do think that Seinfeld probably is one 321 00:20:05,440 --> 00:20:09,439 Speaker 1: of the perfect shows to teach these lessons. As he 322 00:20:09,520 --> 00:20:13,560 Speaker 1: pointed out, you could probably find economics lessons in almost 323 00:20:13,600 --> 00:20:18,280 Speaker 1: any item of pop culture. But because of the varied 324 00:20:19,080 --> 00:20:22,200 Speaker 1: situations that the four friends find themselves in, and because 325 00:20:22,240 --> 00:20:26,360 Speaker 1: of their selfish personalities and the negative ramifications that that 326 00:20:26,520 --> 00:20:30,720 Speaker 1: often creates. Um, it does seem like kind of the 327 00:20:30,760 --> 00:20:35,120 Speaker 1: perfect show to teach, as he put it, chuckboard economics. Right, 328 00:20:35,119 --> 00:20:37,320 Speaker 1: But it's not just the characters. It's the fact that 329 00:20:37,359 --> 00:20:41,240 Speaker 1: there isn't this sort of dramatic, overarching plot. Right, It's 330 00:20:41,280 --> 00:20:44,000 Speaker 1: just these four people in New York and they're doing 331 00:20:44,200 --> 00:20:47,760 Speaker 1: day to day, everyday things, and through that we get 332 00:20:47,800 --> 00:20:51,639 Speaker 1: to learn about some pretty important economics concepts. I really 333 00:20:51,680 --> 00:20:54,520 Speaker 1: really like that, right, Going to pick up a salad, 334 00:20:54,720 --> 00:20:58,360 Speaker 1: getting people gifts, going to whatever. It is a series 335 00:20:58,440 --> 00:21:02,160 Speaker 1: of events and decisions that are all um, yeah, all 336 00:21:02,280 --> 00:21:05,399 Speaker 1: can be tied to economics. A lot of fun. People 337 00:21:05,440 --> 00:21:09,680 Speaker 1: should visit the website YadA YadA YadA econ dot com 338 00:21:09,840 --> 00:21:14,439 Speaker 1: and follow Ellen Grant on Twitter at Baker Echo. All Right, 339 00:21:14,800 --> 00:21:17,480 Speaker 1: thanks everyone for listening. I'm Tracy Alloway. You can follow 340 00:21:17,480 --> 00:21:21,240 Speaker 1: me on Twitter at Tracy Alloway. And I'm Joseph Why 341 00:21:21,280 --> 00:21:23,720 Speaker 1: Isn't Thought? You can follow me on Twitter at the Stalwart. 342 00:21:23,920 --> 00:21:24,760 Speaker 1: Thanks for listening.