Ron’s chair becomes popular after being featured in Bloosh, and Annabelle wants to talk about licensing his designs and scaling up production. Instead of having each handmade by Ron Swanson, they can be mass-produced by foreign labor.
See more: demand shifts, economies of scale, luxury goods, outsourcing, preferences, product differentiation, subjective value
Leslie meets with Kathryn Pinewood to discuss the sizes of sodas sold at the local restaurants. Leslie, as city council member, doesn’t believe that this move by local businesses is good for the health of her community. Local restaurants have gotten creative in marketing the larger sodas by offering price discounts when customers by large volumes. Despite framing the larger sizes with more normal names, Leslie is confused why people would keep purchasing that much soda.
See more: behavioral, choices, framing, health economics, negative externalities, preferences, price discrimination, second degree price discrimination, subjective value
Leslie’s first act as a city councilwoman is to implement a soda tax because she believes that it will make Pawnee healthier. The new larger sodas are causing obesity in town and Leslie aims to regulate the market through taxes. Depending on the size of the local elasticity, there may not be much of a change in consumption, but it could mean additional revenue for the city.
See more: elasticity, externalities, government regulation, government revenue, health economics, negative externalities, preferences, regulation, taxes
Leslie wants to break up with Ben, but she needs to order a bottle of wine before she goes through with it. She let’s the waitress know that she wants wine, but isn’t coy about only selecting the cheapest one because she can’t tell the difference. There’s a long line of literature on the effects of quality and wine prices that shows even professionals can’t often tell the difference between brands.
See more: anchoring, behavioral, preferences, ranking, subjective value, utility maximization
Donna and Tom take Ben on a “Treat Yo Self” day to help him relax, but he just buys socks, which he feels like he needs. Donna and Tom challenge him to think about what he would buy for himself if he could get anything he wanted. Ben decides he wants a Batman costume.
See more: elasticity, income effect, income elastic, luxury goods, necessities, normal goods, preferences, subjective value, utility
Leslie lists the most important things in life: friends, waffles, and work. She has trouble ranking friends and waffles, but she knows work is third. Transitivity is an important component of utility maximization.
See more: preferences, transitivity, utility
Ron isn’t happy with the steak he was served, so instead he asks the waiter to give him all the bacon and eggs they have. While a bit extreme, his preferences and utility function should be respected in society despite the potential for future health issues.
See more: intrinsic value, moral hazard, obesity, preferences, subjective value, utility
Bobby Newport would rather play Wii bowling because the guy looks like him instead of playing on his actual bowling lane right next to his Wii. While this is an uncommon view, his preferences ought to be respected since he’s trying to maximize his utility function.
See more: preferences, substitutes, utility, utility maximization
While on suspension, Leslie buys her officemates Christmas gifts based on their personalities. Ron mentions how he only gives people $20, but realizes how great Leslie’s gifts are and how the office needs to remedy the gift giving imbalance. While Ron takes the most efficient outcome for gift giving, he’s realizing that there may need to be a bit more thought put into the process.
See more: behavioral, equity, gift giving, preferences, utility
The Reasonablists are having their end-of-life party in the local park and Ron sees an opportunity to sell his high quality wooden flutes. Because the party springs up without notice, Ron sees a sudden spike in demand for his flutes. The leader of the Reasonabilists offers Ron a check because they don’t believe it will have any value the next day, but Ron has been selling them flutes for each of their previous going away parties.
See more: demand, demand shifts, elasticity, expectations, inelastic, M2, markets, medium of exchange, money, normal goods, preferences, store of value, transactions, unit of account
Economics of Parks & Recreation 