NFL Ticket Prices on the Rise

According to the article, NFL Ticket Prices on the Rise, even though sales are down average ticket prices have still increased. This seems a little backwards, but prices have actually risen on average 4.5 percent this year. Most the average price increase comes at the expense of the New York football fans, however. In reality, only nine of the NFL's teams have prices above the league average. David Carter, executive director of USC's Sports Business Institute, said "The tough economy is certainly playing a role in pricing decisions made by management, and that some teams soften the blow of a price increase by including price breaks on concessions or parking." Lowering the price for items may help, but not everyone buys from the concession stands or pays for parking to begin with. With the weak demand for tickets, most teams will want to decrease ticket prices to fill the seats.

If we can’t stop immigration why make it illegal.

The bar is set too high for immigrants to comply with the law of becoming legal, so they come here anyway. Some believe, although impossible, if we stopped illegal immigration, that the laws of supply and demand would increase wages to become more desirable for Americans. This might be true but the prices for the products from those jobs would not be so desirable.

If illegal immigrants are interrupting the laws of supply and demand as the article “The Dark Side of Illegal Immigration” would suggest why make them illegal. We should put them on the same playing field as Americans. Instead of tax free below minimum wage workers, why not manage the immigration problem by making it easier for foreign workers to obtain work visas? This would quickly increase taxes from workers who would now be complying with the law. It would also greatly decrease illegal immigration by those who want to comply with the law but have no other recourse if they want to work here (this still does not make it right but its reality).

Is the Recession Over?

The longest recession since the 1930's officially ended in June 2009. Lasting 18 months, this "great recession," as it has been called, has caused the loss of an estimated 8 million jobs. Although technically over, many are asking whether the effects of the recession are really over, or if this is just a temporary state for the economy. According to the LA Times, "Mark Zandi, chief economist at Moody's Analytics, said it was noteworthy that the panel settled on June, as it was during that month that the spending from the Recovery Act stimulus was at its maximum."
In order for the recovery to continue, it seems as though an additional stimulus package will need to be passed by the government.
And, while Warren Buffet is stating that there will not be a double dip recession, more economists are stating that the risk of a double dip recession is increasing.
In my opinion, this recovery is fragile at best. I believe there are more dips ahead for the economy. If allowed to recover at a natural pace, the cycle of the economy will eventually recover to a bullish economy (as Warren Buffet states). This current recession occurred due to economic and political policies which staved off the inevitable and natural downturn in the economy. In order for future "great recessions" to be avoided, reasonable policies need to be in place to allow the natural, smaller recessions to occur.

- Ralphie

I-15 CORE project grows economy

In a small press release from ksl.com, we read the story that the Utah government is creating more jobs with its investment in an I-15 CORE project. According to the article, this new project is creating more jobs than a typical project of this size usually creates as the government is being strategic in utilizing local businesses to purchase the building materials needed for the job.

I appreciate this endeavor as it appears that the Utah government is doing something similar to what the National government did during with time of the “Great Depression” with their Civilian Conservation Corps program.

I believe that this project will shift the “job supply” curve to the right while the “jobs demanded” curve will remain in the same location. As a result, the price of labor may fall some (making it harder for those already employed to make better wages); however, more people will have the opportunity to be employed and thus the overall market will improve with more employed workers.

Matt Ridley's "The Rational Optimist" Is Free (Hurry)

The Rational Optimist, a pretty good seller about economics that came out in June, is priced at $0.00 if you download it to your Kindle.

This price was set by the publisher, and I have no idea how long it will last.

Small Business Bill

The Senate is likely to soon approve a bill to aid small business by providing easier access to loans and some tax breaks. This bill is intended to lower unemployment by stimulating hiring by small businesses and remove a potential barrier to new business start up. The question is will the bill accomplish its intended purpose and what might be the unintended consequences of such a bill. One such example might be an increase in supply in competitive industries with low barriers to entry. In such an industry the accessibility of cheap funding with govt backing might cause a number of new entrants to the market that shouldn't have been admitted. This could drive down prices and hurt all participants in that market until the market naturally returns to equilibrium and these companies will leave the market. In this example the intended purpose would also not occur as hiring might increase for a time but layoffs would follow in due course. The real question that should be considered by the Senate in determining to pass this bill is: is there a supply shortage caused by lack of available funds (likely as a result of recession paranoia) or is the market in equilibrium?

Complementing Tablets

Dodocase is extracting consumer surplus as a complement product to Apple’s iPad. This innovative idea of making a “book-style” case has been extremely successful and has greatly impacted the manufacturers struggling business—not as many books being bound in the US these days. In fact, all these new products have been quite successful with the release of the iPad, and many are being modified to complement the Kindle as Amazon reports an increase in demand.

An Amazing Managerial Economics Video

You have probably seen this.

It is the comedian Louis K C on the old Conan O'Brian show discussing technological advances.

This is copyright protected, so whenever it shows up on the internet it gets taken down very quickly. I won't be updating this link.

The relevance of this is for the perception of people sometimes that they have been ripped off. The relevant bit is just after the 2:00 mark (referring to internet access on planes).

I posted this because of a response I left to Brett's comment on this post by iPoser about Apple, Amazon and MacMillan Publishing.

Many people recognize that the consumer may have lost something after the producer changes something about the business relationship. But this often obscures the fact that the consumer's situation often had to change as well. When both change, it isn't clear that the consumer's have lost anything at all.

This is the sense of this video. How much has anyone lost if a business provides something for you, and then has problems providing it? The answers is ... sometimes ... not much at all.

New laws designed to protect U.S. jobs may be pushing them overseas

In February of this year, the article New farm labor rules comming, announced the Department of Labor's amendment of the H-2A program which now requires "employers who seek work visas for foreign workers [to]...document that they [also] sought qualified U.S. workers" for the same jobs. This new law was supposedly designed to protect jobs for U.S. Citizens as it encourages employers to use Citizens rather than foreign workers.

However, I believe that the exact opposite outcome will occur. Instead of protecting jobs, litigation like this will shift the job supply curve to the left as red tape and other road blocks like this will tempt employers to move their businesses overseas where they will have more freedom to act as they please.

Tom Nassif, President of Western Growers, commented on this new law and shared his feelings in regards to how the very job the law is supposed to protect only makes them more scarce when the said, "We know our produce is going to be harvested by foreign workers, the question is, will it be here in the U.S. or will it be abroad?"

Clearly, laws like this have good intentions but their ramifications only make doing business harder and less desirable in the U.S. I believe the solution to this problem is to deregulate business and to allow the "invisible hand" of markets to dictate terms and not the Government.

Apple, The Puppet Master

Earlier this year Macmillan Publishers and Amazon had a public dispute over Macmillan’s requirement to charge between $12.99 to $14.99 for e-book versions of its bestsellers and some hardcover releases. Amazon retaliated by refusing to sell Macmillan’s books…but it only lasted about a week. Amazon gave in because, well, Macmillan has monopolistic power over its titles, and there’s not much they can do about it since they likely have a load of inventory they’d prefer to cycle through.

It’s important to realize there is another party in this dispute. Because market power is so short-lived (especially right now in the tablet market), Apple is being very strategic in its actions to maintain its market-leader position with the iPad. By persuading MacMillan to follow an agency model with Amazon, Apple has basically regulated Amazon’s Kindle by constraining any advantages the Kindle can gain in the sale of e-books.