Two fundamental concepts of economics that have always frustrated me are the following:
1. An economic choice is fundamentally a value decision made by an individual. An economic actor is making an observable choice, revealing their values and preferences.
2. A market (or the market) uses price as a mechanism to efficiently allocate resources, based on supply and demand, fundamentally driven by the sum of the collective individual preferences of each of the actors in the market.
That may be an oversimplification, and it has been a while since I've taken an economics class, but the gist is right.
So, what's vexing? Well, two things. First, while so many of us claim to believe in one set of things (say, environmental responsibility, or justice, or equality) our revealed preferences show a clear priority in valuing a different set of things (say, comfort, or convenience, or entertainment).
Secondly, while we may truly believe in one set of things, we generally do not feel that our economic choices actually can influence the behaviors of "the market." While we are all supposed to be economic agents, who's behavior, in sum, matters, we feel a complete lack of agency, as far as our ability to make choices that will actually change markets.
With these two points running around the back of my head, I comment Carrotmob, both as an ingenious embodiment of these core economic principles, and as a very cool and innovative approach of connecting the individual economic choices that we might make with real world impact. While my understanding is that Carrotmob is just getting off the ground, I fully recommend taking a look at the organization, which has the potential to be a powerful and exciting change agent, and has, at its core, a possibly sustaining business model (probably not making anybody a millionaire, but perhaps sustaining the platform for change that Carrotmob may grow into...)
Thoughts?
1. An economic choice is fundamentally a value decision made by an individual. An economic actor is making an observable choice, revealing their values and preferences.
2. A market (or the market) uses price as a mechanism to efficiently allocate resources, based on supply and demand, fundamentally driven by the sum of the collective individual preferences of each of the actors in the market.
That may be an oversimplification, and it has been a while since I've taken an economics class, but the gist is right.
So, what's vexing? Well, two things. First, while so many of us claim to believe in one set of things (say, environmental responsibility, or justice, or equality) our revealed preferences show a clear priority in valuing a different set of things (say, comfort, or convenience, or entertainment).
Secondly, while we may truly believe in one set of things, we generally do not feel that our economic choices actually can influence the behaviors of "the market." While we are all supposed to be economic agents, who's behavior, in sum, matters, we feel a complete lack of agency, as far as our ability to make choices that will actually change markets.
With these two points running around the back of my head, I comment Carrotmob, both as an ingenious embodiment of these core economic principles, and as a very cool and innovative approach of connecting the individual economic choices that we might make with real world impact. While my understanding is that Carrotmob is just getting off the ground, I fully recommend taking a look at the organization, which has the potential to be a powerful and exciting change agent, and has, at its core, a possibly sustaining business model (probably not making anybody a millionaire, but perhaps sustaining the platform for change that Carrotmob may grow into...)
Thoughts?
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