Tuesday, September 14, 2010


So, I was talking to a dear friend of mine about... well, you know, random friend stuff, when this exchange came up:

I guess you can't really put a price on the love of a child (though I'm sure Futurama made a reference to it.)

... Actually, you totally could.

The way you do it experimentally?

You would have to determine what people are willing to give up for the love of a child. For instance: a promotion? A car? Etc.

That puts a dollar value on a child's love the same way it does on a Big Mac - you can completely quantify it. Of course, each child's love is a highly differentiated product due to physical, locative and branding concerns along with the unique preference sets of each adult, so it would be hard to make, like, predictive models. But on a small scale, it totally holds up.

Probably all four people reading this blog already know that I'm very close to a Bachelor's of Science in Economics, having jumped ship from Accounting.

Here's the funny thing about it, though:

Nobody seems to really understand what economists actually do. We get lumped in with business guys, because, hey, we all wear suits and talk about money a lot.

It's a whole different thing, though.

Economics is the formal study of choice: that is, how people should allocate resources when they want more than they have. Money's a useful way of comparing two unrelated things, (in fact, this is one of the required properties of anything to be money), but it's really not the point.

Anyway, one of the most fundamental concepts in the whole field is that of opportunity cost.

You can always tell what something is worth to a person by what they're willing to sacrifice in order to have it.

Anyway, I'd better get back to the grind, but I wanted to share that thought while it was fresh in my head. I'll try to share more detailed thoughts about economics later. Oh, and do the other blog entries I promised about narrative. :)

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