The average price paid on StubHub for a ticket to tonight's college football playoff title game is $1,266. That's almost three times the price paid last year ($425)
In a well-functioning market there are only four possible changes, and resulting effects on prices and quantities, in supply and/or demand:
Supply decrease (price rises, quantity falls)
Supply increase (price falls, quantity rises)
Demand increase (price rises, quantity rises)
Demand decrease (price falls, quantity falls)
Tonight's game is being held at Raymond James Stadium in Tampa, capacity 65,890. Last year, the game was in Arizona at University of Phoenix Stadium, capacity 63,400. So we can rule out a supply decrease as the cause of ticket price increases--if anything, supply has increased and we would see downward pressure on prices, all else equal.
So demand must have increased between last year and this year--since the same two teams are playing, Alabama and Clemson. Why might demand have increased?
According to Google, it is 1,649 miles from Tuscaloosa to Phoenix, and 1,970 miles from Clemson to Phoenix.
It is 583 miles from Tuscaloosa to Tampa, and 573 miles from Clemson to Tampa.
Since travel is cheaper, demand for tickets has increased.
I paid $60 for an ~8 foot tree at the choose and cut lot on Poplar Grove (Boone, NC):
For the past several years, I’ve bought my Christmas tree from a stand around the corner from my apartment in Brooklyn. It was always the same, simple price: $10 per foot, which seemed reasonable when I was buying a 5-foot tree for my tiny little walkup. This year, I moved to an apartment with a proper living room and decided to go big. I wanted a tree that was taller than I am. The stand in my new neighborhood charges less — $9 per foot — but I was going for a 6-footer, and something about crossing the $50 Rubicon didn’t sit well with me.
So I took to Twitter to try to gain some perspective.
Ultimately, I got about 150 responses from 29 states. Not the most comprehensive data set, but some interesting results. The cheapest tree, other than for those who cut their own, was in Corvallis, Oregon, for $3.10 per foot. That makes sense, because there are trees everywhere in Oregon.
The most expensive tree I heard about was $35.71 per foot in the Culver City area of Los Angeles. That also makes sense, because LA is ridiculous in every way.
Overall, the average price was $8.70 per foot. Here’s where I got responses from.
Most interesting to me, though, was the variation in results within an area. Take a look at New York City, for instance. In Hell’s Kitchen, on the western side of Manhattan, you can buy a tree for $6.66 per foot. (It is Hell’s Kitchen after all.) But walk a few blocks south to Chelsea, and somebody’s charging $20 per foot. In a place like New York, where many people don’t have cars, vendors can set the price knowing that many people won’t be comparison shopping. ...
The one thing I heard consistently, though: If you really want to negotiate for a good price, wait till Christmas Eve. It’s a buyer’s market.
The national average has increased for 14 days in a row following the OPEC oil production agreement on November 30. Today’s average of $2.21 per gallon is up three cents per gallon on the week and two cents per gallon on the month. The national average is up 20 cents compared to the same date last year.
Last month, OPEC agreed to cut output by 1.2 million barrels per day beginning January 2017 and markets have continued to react to the production cut agreement with crude oil prices hitting an 18 month high. Retail prices have steadily increased following the news of the OPEC agreement, but the effectiveness of the deal and continued market impacts will hinge on all countries implementing the agreed to production levels.
People awarded doctoral degrees at American universities last year continued to face less-certain futures than those who earned such degrees before the economy took a nosedive in late 2008, according to new federal survey data.
The survey of 2015 doctorate recipients found that 38 percent of those responding to a question about their future plans reported having no definite commitment for employment or postdoctoral study. While a slight improvement over the previous year, when 38.6 percent of respondents said they had no such commitments, that figure remains substantially higher than it was before the Great Recession. In 2008, before the nation’s economic woes began to be widely felt, fewer than 31 percent reported having no job or postsecondary study lined up.
Despite the weak job market, the number of doctorates awarded by American institutions rose for the fifth straight year, reaching an all-time high of more than 55,000. Among the fields with the fastest growth were political science, sociology, and education. The share of 2015 doctorate recipients who were U.S. citizens or permanent residents stood at about 64 percent, nearly a percentage point higher than the year before.
The data come from the Survey of Earned Doctorates, an annual census sponsored by six federal agencies: the National Science Foundation, the National Institutes of Health, the U.S. Department of Education, the U.S. Department of Agriculture, the National Endowment for the Humanities, and the National Aeronautics and Space Administration.
If wages and nonpecuniary job characteristics are going down then you'd expect a lower quantity of PhDs supplied. Since there are more PhDs being awarded there must be something increasing the supply curve (and keeping wages low). Unfortunately, I don't have a peppy answer for this one as I'm not at a R1 university and can only imagine why talented people continue to enroll in graduate school. It could be that (1) nonacademic jobs are just as bad and getting worse faster or (2) generous stipends and the hope that things will change after five plus years of graduate study encourages the pursuit of a PhD.
The hot toy for Christmas this year are Hatchimals. Apparently a lot of people want them. When more buyers enter a market, we represent that by an increase in demand (a shift tot he right in the demand curve. If, when demand increases, the price of the product doesn't increase, we would expect there to be a shortage of the product; more people want the product than are available. As a result, we would expect upward pressure on the price to alleviate the shortage.
In the case of popular Christmas toys however, the manufacturer is usually reluctant to raise the price of their product once it is on the market. This reluctance exists for a couple of reasons, 1) if the company realized they underpriced their product and suddenly increased the price in light of unanticipated demand, the company would be labeled a bunch of greedy bastards and the demand would likely decrease, and 2) the perpetual shortage created by the low price leads to a ton of publicity and that publicity is good for the company in the long run.
SO when we get a hot Christmas toy (Hatchimals, Furby, Tickle-me-Elmo, Cabbage Patch Kids...), it's unlikely we will see an increase in the price of the product on the store shelves. The price is the price and it usually doesn't move. So what do we get? Lines, fights, and a lot of news coverage.
Does that mean that the market doesn't work? Afterall, we preach that if a market is working correctly, there will be no perpetual shortages or surpluses and prices will adjust to ration the good unless the price is regulated so it can't adjust. So why don't prices for the 'hot toy' each Christmas?
The bestselling author of 'Water for Elephants' has managed to sell out of the 156 Hatchimals that she bought off eBay in just four days.
Sara Gruen managed to make a profit of approximately $6,000 after she sold the lot to individual buyers, which she purchased for the price of $23,595.31 the day after Black Friday.
Last week, she began to complain online that eBay would only let her sell four od [sic] the toys a week, which meant she would not be able to get rid of the Hatchimals before Christmas, but then she set up an online shop and they went quickly, with each toy also coming with one of her signed books.
You see, eBay is a market. And prices on eBay are rising to alleviate the shortage (right now, prices for a new Hatchimal are in the $130 range on eBay).
Suppose the supply of lower-wage workers suddenly decreases. a) What is the effect on wages and employment in sectors dependent on lower-wage workers? b) What is the effect in output markets dependent on employment of input markets that employ lower-wage workers?
In your answer please use basic supply and demand analysis, graphs, and provide an example as illustration. If possible, provide a mainstream news story to support your analysis.
a) If the supply of lower-wage workers decreases (shifts to the left) the the total number of workers employed in lower-wage jobs will decrease and the wages for those lower-wage workers still working will increase (see graph below):
Example: If a new immigration policy results in the deportation of large numbers of lower-wage workers, the total number of workers employed in lower-wage sectors will decrease and the wages of those workers working in lower-wage jobs will increase. For arguments sake, let's call the workers legal and illegal, and suppose that illegal workers are willing to work for lower wages. This means lower-wage workers fall at the lower tail of the worker supply curve (they will be in the southwest corner of the graph). If mass deportation of illegal workers occurs, and wages do not rise, then total employment in these sectors will fall by the amount of the deportation. But because lower-wage demanding illegal workers have displaced higher-wage demanding legal workers, employers in these sectors will begin to offer higher wages and draw some of the higher-wage legal workers into these sectors. The end result is higher wages in these sectors, fewer total workers employed in these sectors, but more legal workers working in these sectors (at higher wages) than before. A WIN for legal workers.
b) But we need to recognize that higher wages in these sectors represent an increase in input prices for output markets reliant on these inputs. An increase in inout prices shows up as a decrease in supply in the output market and higher output prices and lower output quantities (see graph):
Example (cont'd): The decrease in the supply of workers due to a new deportation immigration policy will result in an increase in prices for outputs that rely on lower-wage workers for production. For example, the prices of most domestically produced fruits and vegetables are likely to increase as a result of the decrease in availability of lower-wage workers and the higher wages for the legal workers. That a LOSE for domestic fruit and vegetable consumers.
In addition, the higher prices of domestic fruits and vegetables will increase the pressure to import fruits and vegetables from countries that can produce fruits and vegetables with lower-wage workers AND the higher wages for legal workers will increase the incentives for domestic producers to lower costs in other ways, likely through technological improvements that reduce the demand for higher-wage legal workers.
President-elect Donald Trump has promised a major crackdown on illegal immigration, triggering immense alarm among the country's 11 million undocumented people. But Trump’s deportation promises, if fulfilled, would ripple far beyond the lives of illegal immigrants. Deportations would affect vast swaths of the economy — with a particularly dramatic impact on agriculture.
As a result, Americans could see the cost of some fruits and vegetables soar.
Undocumented workers account for 67 percent of people harvesting fruit, according to the Agriculture Department. They make up 61 percent of all employees on vegetable farms, and as many as half of all workers picking crops.
Agricultural economists across the political spectrum say that there’s no way that workforce could be raptured up without reverberations throughout the food system — think farm bankruptcies, labor shortages and an eventual contraction of the broader economy. And even if you’re far from the agriculture industry, you could see $4 milk, low-quality oranges, and extortionately priced raspberries.
The logic behind these dire predictions is pretty straightforward. If Trump were to begin deporting farmworkers or requiring that farms verify their work status, farmers would have three ways to fill in the labor gaps. They could hire legally authorized workers, who are vastly more expensive; switch away from crops that require human laborers to harvest them; or cut production, allowing fields to fallow and fruit to go unharvested.
Whichever way you slice it, farmers pay more to produce less — which could squeeze the budgets of the very Americans who supported Trump’s immigration message. To many of them, mass deportation sounded attractive in the abstract. But practically speaking, the economy is so complex — and so interdependent — that Trump could not possibly deport the country’s 11 million undocumented people without also impacting middle-Americans’ wallets.
In fact, to keep costs under control, Americans may end up being forced to buy more groceries from abroad, undermining Trump's effort to boost American industry.
Governor Pat McCrory today activated North Carolina’s State Emergency Response Team to coordinate with counties regarding fuel needs as Colonial Pipeline officials continue working to fix a damaged pipeline that supplies much of the east coast with petroleum products.
“I continue to warn motorists to be on the lookout for price gouging,” said Governor McCrory. “We are taking steps to protect consumers and ensure that fuel is continuing to flow into the state. To help ensure adequate fuel supplies, I have instructed state agencies to consider options to limit fuel use, including curtailing non-essential travel for state employees.”
The political definition of price gouging tends to be price rising. If the government doesn't allow prices to rise with a shortage then the shortage persists. Consumers may even make it worse by increasing demand and hoarding in case they need the product later when it is not available.
NC Attorney General spokeswoman Noelle Talley says investigators are checking reports of gas being sold at $5.89 a gallon and another offered at more than $4 a gallon.
Talley says a station north of Winston-Salem advertised a price of $9.99 a gallon, but that was after it had run out of gas.
A CBS North Carolina viewer reported that a Durham gas station received a delivery of gas and that prices at the station immediately jumped from $2.19 a gallon to $2.79 per gallon late Monday afternoon.
The NC AG should leave that $2.79 complaint alone.
The headline reads: East Coast Faces Gas Shortages, Price Hikes After Pipeline Leak. In academic terms, a shortage occurs when the quantity demanded exceeds the quantity supplied of a good at the current price. That would seem to be the case here. The pipeline leak has led to a decrease in the supply of gas to the east coast. If prices are held constant, then a shortage will occur because the quantity demanded at the current price has not changed, but the quantity supplied at the current price (and at all other prices) has decreased. So if the market were in equilibrium before the supply decrease, and the price remains unchanged, then the quantity supplied is now less than the quantity demanded at the current price. The shortage will persist if the price is unable to adjust to alleviate the shortage. BUT, as the headline alludes, the price CAN adjust and any shortage will be temporary. A shortage places upward pressure on prices. As the price rises, the quantity demand decreased (the law of demand) and the quantity supplied increases (the law of supply). The price will keep rising until the amount of gas people want (quantity demanded) equals the amount of gas sellers are willing to sell (quantity supplied). The figure below illustrates the situation:
The left-hand panel illustrates the situation before the leak. As a result of the leak, the supply decreases (right-hand panel) and the price rises and quantity of gas sold decreases. If the price were to stay at the 'before' level, there would be a persistent shortage.
In 1987, the Montreal Protocol, an international treaty to address atmospheric ozone depletion, established timelines for the phasing out of Chloroflourocarbons (CFCs) and Hydrochloroflourocarbons (HCFCs). Production and use of CFC's, the more damaging of the XCFC's was banned almost immediately-by 1996, immediate in regulatory terms--and hairdressers everywhere has to find alternatives to their Aquanet. HCFCs, with less greenhouse gas potential, have faced a slower phase out, with most uses phased to zero by 2020 and all uses by 2030.
Of importance to me, and really that's all that's important here, the primary refrigerant in most household air conditioning units installed before 2005 (as mine was, the significance of which will become apparent imminently) is Freon, also knows as R-22, or Chlordiflouromethane, an HCFC.
Well, upon returning from my field research trip yesterday, I arrived home to local warming--that is, my air conditioner had crapped out while I was gone. As the tech put it, we have a small leak in one of the copper lines--environmental shame on us--and a dirty coil, which caused the supply lines to freeze. The long-term solution is a new AC unit (or a lot of sweat), but the short-term solution is a cleaning and recharging of our current unit with somewhere between 0-4 pounds of R-22.
Knowing a rough history of Freon, this news from the tech caused my inner-economist to come to attention. Future bans on R-22 (supply decrease) are going to cause current supplies to decrease (rationing) and cause current price increases. So I ask, tepidly, "How much is R-22 these days?"
The tech, sensing my insider knowledge, says, well, unfortunately, prices have doubled in the past year and they're expected to keep going up until we can't use R-22 anymore in 2020. He said prices are about $100 a pound now.
Stefanie Kopchick, North America marketing manager for refrigerants, The Chemours Co., said the annual allowances have decreased faster than the market demand for R-22, which has depleted inventory across the supply chain.
“Chemours is not excluded from this reality,” she said. “As a result, in 2016, we’re starting to feel the snugness in supply; our wholesale partners have been cut back significantly as the inventory Chemours built in advance of the final phasedown period continues to be depleted.”
With meteorologists predicting normal to warmer-than-normal temperatures this summer, industry leaders only expect demand for the refrigerant to increase. Further adding to the increasing demand is a drop in reclamation and an increase in interest values affecting financing decisions, said Gordon McKinney, vice president and COO of Icor Intl.
“The amount of R-22 being recovered and reclaimed is not expected to contribute much more than 8 million pounds this year,” he said. “Interest rates are on the rise, and that will make repairing a better option than replaceing for many air conditioning and refrigeration equipment owners. With service demands for R-22 in the U.S. still estimated to be in the tens of millions of pounds per year, many R-22 users will need to transition to an ozone-safe alternative, like ICOR’s NU-22B®, to service legacy R-22 systems.”
McKinney mentioned the price of R-22 increased in the fourth quarter of 2015 by an average of 15 percent, is expected to increase through the year, and could reach record levels by the end of 2016. For HVACR contractors and distributors, this could spell trouble.
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