Wednesday, September 20, 2006

As someone with a small article on the economics of spam, I was interested in a new book by Seth Godin entitled Small is the New Big. Godin envisions an e-mail service that forces those who misuse it for spam-purposes pay a significant cost. (Today, the marginal cost of a spam email is zero, which is why we see so many of these e-mails filling our inboxes.)

What if Google decided to make a Gmail account cost $1 a year instead of giving it away for free? And what if you had to use a valid credit card to pay for it?

And further, what if your Google e-mail address had to include your real name?

And what if a violation of Google's anti-spam rules (I'm assuming they'd have some) would cost $20 per incident?

Suddenly Google would become the gold standard. People would happily let it through the spam filters. You could trust it. People would become suspicious of anyone who used any other online e-mail service.

Why might this scheme make Google the gold standard among email providers? Why might it not? Would you sign up for such a service? Would it reduce the amount of spam out there, or would it simply reduce spam originating from Gmail accounts?

(If the economics of spam interests you, see this exercise. If you really like Spam, go here. And then see this.)

Tuesday, September 19, 2006

Define the Law of Demand, demand schedule, and demand curve.

Define: substitutes and complements. What are perfect substitutes and perfect complements? How would a change in the price of good A result on the market demand of good B if A and B are complements? Give an example.

Differentiate between changes in quantity demanded and changes in demand. Differentiate between changes in quantity supplied and changes in supply.

What causes the demand curve to shift left or right?

Define: Law of Supply.

True or false: If global warming has the effect of allowing farmers to produce more crops due to longer summers, then the result would be an increase in the quantity supplied of agricultural goods.

What are some factors that affect demand? supply?

Here is the best soccer goal ever.

Monday, September 18, 2006

A new paper in the Journal of Labor Research notes the positive relationship between social drinking and incomes. Here is the full study.