This is Us — Who Has the Right to Light?

Kevin and Randall are two brothers who share a room. In this clip, Randall is trying to finish his homework by his bedside underneath a desk lamp. Being it is 2:00AM, Kevin is trying to sleep and is annoyed by the added light in the room. An altercation ensues, prompting Rebecca to intervene. After an offer from Randall to move to a different room, Kevin barges out, retreating to the basement.

The cause of the initial problem is Randall’s desk light, which acts as the negative externality in the situation. Randall is the producer of the externality, because the opportunity cost of shutting off the light and going to bed is too high in the face of his other responsibilities, such as football and homework. Kevin’s opportunity cost, however, conflicts with Randall’s preferences, because the opportunity cost of losing sleep is too high in light of his commitment to football. In searching for a solution, Randall makes a transaction cost by offering to move into the kitchen, since this offer acts as a form of negotiation. The problem is eventually ended through Kevin’s internalization of the externality: moving to the basement. It is through this action that Kevin utilizes the Coase Theorem to eliminate any more transaction costs and to end the problem efficiently.

Thanks to Megan Vareha for the clip and the summary!

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Always Sunny — Charlie & Mac Can’t Go to the Pool

In this episode of “It’s Always Sunny in Philadelphia,” Mac and Charlie try to go swimming during the heat wave in Philadelphia. They grab their beer and floaties and head over to the local swim club. However, they are stopped by a worker who makes them put their beer away and then proceeds to tell them that they cannot be there because they are not members of the swim club. Frustrated with this, Mac and Charlie decide to make their own swim club, one that anyone can attend.

This clip relates to economics because the swim club is an example of an excludable, non-rival good, which is a club good. Because Mac and Charlie don’t pay the fee to be a member, they are unable to swim there. And, the worker tells them that they are at full capacity and are accepting no more members because the pool has the ability to restrict the number of members and charge higher prices. The two get disgruntled because they think the pool really isn’t at full capacity. They decide to go to an abandoned pool, one they used to swim in during their childhoods, and revamp it to make it nonexcludable and nonrival, which would make it a common resource. However, since it would become a public good, it would be easy to get overcrowded, making it rival and a common good.

Thanks to Anna DeCecco for the clip and summary.

Superstore — Messy Roommate Situation

Garrett and Jonah became roommates after a tornado destroyed Jonah’s apartment, but it turns out that their habits aren’t exactly conducive to being roommates. Garrett passively aggressively lets Jonah know that he’s messy when it comes to taking a shower so he buys Jonah a bathmat. In return, Jonah suggests that he get Garrett a pair of noise-canceling headphones since he’s so bothered by every noise Jonah makes. The two go back-and-forth listing the various ways they annoy each other.

Christmas with the Kranks — Hickory Honey Ham

This scene is from the movie Christmas with the Kranks involves a specific type of ham that has been sold out and Mrs. Krank needs one because it’s Christmas Eve and her daughter flew in for Christmas.  She pays above the sticker price of the ham because it was the last one available in the store. Because there is only one ham left and it doesn’t matter how much the ham costs, Mrs. Krank will buy it.  This means that Mrs. Krank’s elasticity for hickory honey ham is very inelastic.

Thanks to Salvatore Pollastro for the summary and the clip!

Home Improvement — Technological Improvement

Tim decides to customize his lawn mower in order to get more power out of it. By doing so he’s able to mow his lawn much quicker than he previous did. This technological innovation allows him to complete his task much quicker and spend more time on other tasks that need to be completed around the house.

The Daily Show — Ugly People Discrimination

Daily Show correspondent, Jason Jones, interviews Dan Hamermesh about looks-based discrimination. While people traditionally associate discrimination with race and gender, discrimination from an economic perspective is showing priority to one group of people over another. While the correspondent takes a comedic approach, the research by Hamermesh has been covered by a variety of outlets including Wall Street Journal, Freakonomics, New York Times, and US News.

The Big Short — Risk vs Reward

In this scene from The Big Short, the traders illustrate the concept of risk/reward payoffs using Jenga blocks. When trying to determine which investments to approach, the safest returns (the blocks at the top) are the easiest to invest in, but they don’t offer much of a return because they are so safe. The investments that are a bit risker (the blocks at the bottom) are compensated with higher returns to compensate investors who take the risk.

Bud Light — Swear Jar

Normally a swear jar would be used to curb bad behavior (like in this clip from New Girl), but the folks around this office are using the money to buy Bud Light and have incidentally increased the usage of swear words.

Stella Artois — The Race

Sometimes a good thing is too good to pass up. The young men could continue the big race or they could sacrifice their chance for a cold beer. They chose the latter.

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