Economist Art Carden discusses his popular book, Strangers With Candy. They explore Chinese student migration, China's economy, reducing interest rates to 3%, blaming banks, engaging with the public, and waging wars on abstract nouns.
Wealthy Chinese citizens are leaving the country, with increased demand for international education and emigration, despite not prioritizing economic freedom in their chosen destinations.
The concept of reservation wage highlights the disparity between what people say they are willing to accept as a wage and the reality, emphasizing the importance of observing behavior to understand economic decision-making.
Deep dives
Growing Numbers of Wealthy Chinese Leaving China
A significant trend is emerging in China, with growing numbers of wealthy Chinese leaving the country. Chinese students are showing a higher demand for attending international schools abroad, and thousands of Chinese millionaires are emigrating to other countries each year. Surprisingly, wealthy Chinese students are not seeking out countries with more economic freedom, as evidenced by reduced numbers of Chinese students attending American colleges and universities. Additionally, China's centrally planned economy appears to be stalling, leading to the cessation of unemployment statistic publication for young workers. Although it may seem like a story of Chinese citizens leaving an oppressive country for a more free one, the data and trends suggest a more complex picture.
The Reservation Wage and Economic Decision Making
The concept of the reservation wage, which refers to the lowest wage a person is willing to accept, is explored. In the United States, the average reservation wage is currently around $78,645, reflecting an increase of 8% from the previous year. However, this reservation wage does not align with the average household wage, indicating a disconnect between expectations and reality. This raises the question of whether people inflate their reservation wage when asked, as behavior often reveals more accurate preferences and choices. The reservation wage concept sheds light on economic decision making and the importance of understanding the difference between what people say and what they actually do.
The Misconception of Exploitation in Pricing
The pricing strategy of hotel gift shops and the perception of exploitation is discussed. While it is common for hotel gift shops to charge high prices, especially when compared to regular stores, this should not be viewed as exploitation. Instead, it demonstrates specialization and availability. The higher price signals that the undershirts in the gift shop are specialized and available for customers who really need them. By examining this pricing phenomenon, it becomes apparent that consumers should consider the value and importance of a product to them before attributing exploitation to the pricing strategy of businesses.
The Fallacy of Job Preservation Through Self-Checkout
The fallacy of preserving jobs by refusing to use self-checkout at grocery stores is debunked. This misconception assumes that using self-checkout machines will eliminate job opportunities for human cashiers. However, embracing technology and automation is not detrimental to overall employment. Instead, it drives economic progress and creates new jobs in other sectors. The shift to self-checkout is an example of how innovative technologies can streamline processes and enhance efficiency for consumers. Focusing on preserving outdated job roles ignores the broader benefits that come from embracing automation and allowing human capital to be directed towards more meaningful and productive endeavors.
