Friday, September 9, 2011
EWOT #1
The economic topic that I came across this week that I wanted to talk about was something that happened to me in Douglas dining court. I ordered an omelette at the omelette station for breakfast. I waited for 5 minutes while the lady made me and 4 other people their breakfast. After this time had passed and my omelette was finished, she handed me the wrong one. I took it back to my seat, saw that it wasn't the egg that I had ordered, and then took it back to show the lady who made it. She took the egg, threw it out and then told me to go to the front of the line and she would make me another one. This relates to when Professor Rizzo proposed the question on the first day of class of why orange juice left on the desk for him to clean up was bad economically. The answer to this was that besides it showing that the person who left the mess didn't care for the people after him who came into the room and had to use that same desk, but he took time away from Professor Rizzo teaching the class so that he could clean up the mess. The egg situation is similar because I had to wait another 5 minutes for my omelette to be made. This took time I had before my first class that I could have used to get a better seat which would optimize my learning potential. It also took 5 minutes away from everyone else who was behind me in line who had to wait so that I could get my omelette. These people may have been in a rush and had to go late to class or a meeting so that I could get my omelette remade in front of them. None of this would have happened if the lady who was making the omelettes cared enough to make sure she gave people the omelette that they ordered rather than handing them out randomly. Her faulty decision may have affected mine and the people behind me's day.
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Good example thought you are not entirely correct in your application of economics to the example.
ReplyDeleteWhen Rizzo spoke about the orange juice example in class on the first day, he gave the example that this was a shared desk that many people used throughout the day. There was not a single owner of the desk. Think about what the incentives might be in this case? If you do not own the desk (i.e. you will not be coming back there to use that same desk every day and you have no need for it to be in pristine condition) why would you spend the time cleaning up the mess, a cost to you in terms of the time spent cleaning up the mess, which you derive no benefit from. This is referred to as a common good or public good problem in economics or a freerider problem. No one person has an incentive to clean up the mess so it does not get cleaned up.
I do not think this same economic concept applies to your omelette example, though maybe you can convince me otherwise. It may be an unfortunate event that she mixed up the omelettes, though it does not seem to be the same problem as was seen in the desk-orange juice example. What might be an economic solution to making sure omelettes do not get mixed up in the future?
After this class, I sent an email to Rizzo saying,
ReplyDelete"Could it be then than the person who spilled the orange juice didn't care enough about the people entering the room after him/her to have cleaned it up so that the new person in the room would not have to deal with his/her mess. This is bad economically because to make good economic decisions one has to care about the people that he/she is affecting with their decisions. By not cleaning up the orange juice, the person who spilled it made your day that much harder cleaning it up rather than cleaning it up when it happened and making you not have to take time away from teaching the class to clean up the mess?
-Sam Slutsky"
and he replied, "Now you’re talking Sam. Of course, we’ll formalize what it means to care and what institutions have to be in place to make them care. We can also apply the EWOT to why the orange juice got spilled in the first place – the same reason we suffer from traffic, loud dorms at night, and even CO2 emissions…
I keep a file of correspondence in the grade center, but you cannot see it. I make note of the good questions student answer. I don’t have a formal extra credit system, but I use it to keep in mind which students were engaged (so for example I can reach out to you if there are events on campus that I think would be interesting). Thanks,
Mike"