Wednesday, November 23, 2005
Identity and Economics, II
by Tom Bozzo
Insofar as there was some jargon in the last post, some illustrations of the identity economics/consumption externality issue might be in order:
- Car nut (I): Buys car with stick shift due to shame over admitting convenience of automatic transmission to car nut friend (that's me).
- Car nut (II): Buys car with big engine due to disinclination to lose hypothetical drag race to childless friend with Porsche Boxster S (that's me, too).
- Poseur car nut: Buys Mercedes C-Class with small engine and automatic transmission because guy down the street has one (not me, actually).
- Spatial transmission of housing bubble: "Sharps" with inflated currency from bubble markets are amazed at what they can afford in midwestern "latte town," force natives into choice of working extra hours to overcome regional compensating wage differential, abandoning close-in neighborhoods for less-expensive burbs, depression over relatively high prices (not quite me, but the Biggest and Most Expensive House on the Street happens to be owned by a humanities professor who had the good fortune to come here from the San Francisco Bay area).
