Economists, Assemble
My sons teach me economics
He did it.
A few weeks ago I told you about my sons playing Pokemon cards. If you missed it, here’s the summary: my sons play Pokemon cards, but my 6 year-old always loses to the 9 year-old, so I used the 6 year-old’s cards and defeated his older brother to prove it could be done.
My goal in beating my son was to show the younger one that it was possible. Sure enough, the next day I caught my 6yo laying out the cards and practicing against himself. He was determined to reveal the secrets to my magic.
Then the day after he ran up to me. “Dad! I beat him!!”
My original takeaway from this encounter was about TFP. This game was a microcosm of a larger economic world where people with the same resources can see large differences in productivity. My 6yo lost every time, but with the same cards I delivered a decisive victory.
When he learned the strategy and won himself, I learned another lesson: TFP is not innate; indeed, it’s transferrable. This is important because the largest cause of disparities across countries is a difference in TFP. Mexico, even with the same resources as the US, just isn’t as good at using them. In Mexico, this inefficiency comes from many sources, but a main one is how the law creates incentives for misusing resources. But, as my son demonstrated, that doesn’t have to be so! Countries like Mexico can learn to be more productive with their resources.
I think next week’s video will cover this topic. Be on the lookout. But let’s talk about this week’s video.
Captain America: Economics Hero
I feel like I should listen to my students. Each semester, students have the opportunity provide me feedback. Consistently, every semester students say they appreciate when I use movies to illustrate economic principles. And that’s how I started my channel: with lots of references to movies. But I had moved away from that.
When thinking about how to make more videos that I’m excited about, dissecting economic themes in movies kept resurfacing. If students love the idea so much, surely more people would, right?
So this week is my first in a series. I’m starting with game theory in Captain America and the Winter Soldier. In a few weeks I’ll probably do a video on the Coase Theorem in Captain America: Civil War. I have a list of a few other ideas, but here’s my question for you: which movies would you like me to analyze? Either comment on the video or reply to this email with your suggestion. You don’t have to tell me the economic principle to look for, just the movie you want to see overanalyzed.
