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Midweek Musings

The Irish miracle... The costs of inflation and rec...

Until this week, I hadn't heard of Pokemon Go (I know, I know...But I was on vacation last week.) But apparently, not only is everyone playing it, it's also "everything that is wrong with global capitalism." Seriously? The analogy to the bowling alley, for example, I find weak. I doubt all bowling alleys and bowling-related service appeared simultaneously, just as I'm sure Pokemon Go will spawn entrepreneurial opportunities for teenagers in the coming days. And growing regional inequalities? Falling interest rates and slow growth? Hmmm...What do you think?

Markets are characterized by competition, right? Well, not according to this piece in The Guardian. According to the author, "...the belief that the best ideas will always succeed is rather like the faith that unregulated financial markets will always produce the best economic outcomes." While I'm not interested in the Flat Earth "conspiracy," this did call to mind one of my favorite articles by Ronald Coase, "The Market for Goods and the Market for Ideas." For more on Coase, and on his better-known articles, check out this EconTalk episode with Don Boudreaux, this article by columnist Pedro Schwartz, and this EconTalk episode with Coase himself. What's your favorite from Coase's oeuvre?

I finally watched both parts of Free to Choose Media's new documentary on Adam Smith. Emily Skarbek gave a nice account of the film here this spring. Overall, I'm impressed- though more so with the first hour than the second. The first gets more into questions of moral philosophy, as suggested in this LIVE EconTalk episode with Jim Otteson (also featured in the Free to Choose film) and Nobel laureate Vernon Smith. The second hour was a lovely defense of free trade and globalization, but left me wanting a bit more, well, Smith. Have you seen it? Thoughts?

The film did prompt me to look up Denis Diderot's illustration of the division of labor in a pin factory... You can read Adam Smith's description in The Wealth of Nations here.


Finally, and for a bit of fun (sort of), this article flashed across my Facebook feed a lot this week. I actually read it. Not sure what this suggests about my potential for going viral...But I do hope you read the links here! ;-)

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CATEGORIES: Economic Education

COMMENTS (9 to date)
Henri Hein writes:

Hi Amy,

I did check out some of your links :). I enjoy your musings. On the last one, I saw that on my feeds as well, and kept ignoring it. I'm glad you got me to read it, as the author actually makes a good point, and I got a bit of a laugh out of knowing there was a point to the headline.

Did you miss a link to a Guardian article? Your second paragraph refers to "this piece in The Guardian," but I'm not seeing a link to any piece. I enjoyed the Coase refreshers, though :).

Amy Willis writes:

@Henri, Thanks!!! I fixed the link.

mattb writes:

For a more positive take on Pokemon Go, apparently it has well over 20 million daily active users. If the vox article is correct, and Nintendo is making a million dollars a day off of purchases, then it costs Pokemon go users an average of $0.05 a day to play! With these types of "freemium" games like candy crush, and Pokemon go, the vast majority of users actually pay nothing at all to play, while the very few hardcore users pay hundreds of dollars a month, effectively subsidizing all of the free players.

So Nintendo rather than "destroying the world" as the vox article implies, is actually providing free entertainment for most of its users, freeing up the money they would have otherwise spent on video games so they can spend it on other things.

Amy Willis writes:

@mattb, thanks! Any chance you have a link to that info? This was my gut reaction...Also, with more people moving about, more chance to see and visit local businesses (more so than sitting in front of a game console, anyway...)

mattb writes:

Here is an article I read in tech crunch that breaks down some of the stats on how many people are playing pokemon and how often they are playing.

Pajser writes:

If Pokemon Go provides greater value than competition, consumers will be willing to spend more money on that product, than on the products it out-competes, right? If yes, then less of money will be spent locally.

Amy Willis writes:

re: Pokemon Go, here's a good piece in Medium I cam across this morning via Mercatus:

Tom West writes:

So Nintendo rather than "destroying the world" as the vox article implies, is actually providing free entertainment for most of its users, freeing up the money they would have otherwise spent on video games so they can spend it on other things.

Unless you were providing the service that has dropped in price, in which case you're now unemployed and have no money to spend.

The narrative is compelling on its surface, but also wrong (if the past is any guide).

That said, the caveat is that the past might not be a guide.

My concern is that with each technological leap, the minimum requirements to be a middle-class member of society have increased (along with the rewards for being middle-class). At some point, those requirements become high enough to exclude a substantial segment of society. And that, as we have seen across the world, has a bad long term prognosis.

ThaomasH writes:

But according to the article. pace the headline, "everything that is wrong" with Pokemon Go is that cities need more residence and development friendly zoning laws and central banks need to prevent collapses in aggregated demand. But we knew that before Pokemon Go came along.

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