Author: Jadrian Wooten

Economics eductor. Follow me @Wootenomics

Categories
Labor Principles

Surprise Incentives

Each year employees participate in Color Wars, where the employees are divided between two teams to see which team can sell the most during the day. Glenn announces that the winning team will receive a pizza party. While the employees aren’t overly happy about either the Color Wars or the pizza party, incentives can usually be a way to induce higher levels of productivity. It turns out that each team member also receives $100, but Glenn was saving it as a surprise incentive. Amy has to explain to him that incentives need to be announced at the beginning in order for them to actually work.

Categories
Consumer Choice & Behavioral

Inefficiency of Wrapping Gifts

After being assigned to wrap gifts for customers, we learn that Garrett doesn’t actually no how to this. He tries to hide this by making an economic argument that wrapping gifts is inefficient since it just wastes time in the transaction process.

Categories
Labor Supply & Demand

Handheld Automation

Corporate has created new devices for customers to use that will allow them to look up where items are located in the store, scan the items, and pay for their total. The employees quickly point out that the device essentially replaces the workers and they are left wondering what that means for them. Dina tries to point out the relationship between ATMs and bank tellers, although she doesn’t have it exactly right.

At the end of the clip, Amy points out that corporate has also asked the stores to cut back employee hours, which implies that the new machines are replacing some of the labor in the store.

Categories
Labor Labor Law

The Union Buster Arrives

After Amy and Jonah contact the corporate office to secure paid maternity leave for Cheyenne, the main office sends a union buster to the store to try and talk the employees out of forming a union. These union busters are paid to help dispel the idea that unions can benefit workers. Firms are often willing to spend money (which reduces profits) so they can avoid paying higher wages (which also would reduce profit).

Categories
Labor Labor Law

Union Scare

The team is trying to donate days off so Cheyenne can have her baby since Cloud 9 doesn’t offer maternity leave. Jonah finds out how much profit Cloud 9 made the year before and calls corporate with Amy to try and see if they can give Cheyenne maternity leave.

Jonah inadvertently says the word “union” and a mess ensues. His goal was to secure paid maternity leave for an employee who will soon give birth, but the corporate office believes the store is threatening to unionize. The corporate office sends a union buster who behaves as though he is a labor relations consultant.

Categories
Consumer Choice & Behavioral crime Principles

A Truck with No Radio

As Dina and Amy go searching for Bo, Amy notices that Dina doesn’t have a radio in her truck. It turns out that Dina special-ordered her truck without a radio (even though it costs more) because she believes it would make her truck less appealing to potential thieves. If criminals behave rationally (which Gary Becker argued that most do), a truck without a radio wouldn’t be worth the potential cost associated with car theft. Dina has removed the incentive to steal her truck.

Categories
Growth Labor Supply & Demand

Cell Phones: Innovative or Destructive?

It’s back to school time and everyone has flooded the store to buy calculators, notebooks, dictionaries, and planners, but these are all items that come with a smartphone so it makes those products obsolete for most individuals. Joseph Schumpeter was a popular economic philosopher who pioneered the theory of creative destruction, which occurs when new innovations replace old industries. The benefits are a higher standard of living, but at the cost of jobs in those old industries.

Categories
Labor

Negotiating for a Raise

Amy wants to ask her boss for a raise, but she’s nervous. Jonah attempts to encourage her to fight for a higher wage because a portion of the wage gap is partly due to women being socialized that negotiating isn’t in their favor. Amy isn’t in the mood for his lecture, and Jonah gives up.

Categories
Consumer Choice & Behavioral Statistics

Probability of Success

When it comes to selecting numbers for a lottery, people tend to irrationally believe certain numbers are more important than others. Each number is just as likely to be selected as the other numbers, so placing a higher probability on one number being selected isn’t rational. Garret isn’t fooled, but he also isn’t fond of wasting his time watching others behave so irrationally.

Categories
Supply & Demand

Lottery Debate

Mateo and Cheyenne discuss what they would do if they won the lottery. The two list a variety of different items they would spend their money on after receiving their income boost. This income adjustment would result in the two of them purchasing normal goods, specifically luxury goods. These purchases are driven by income changes, not by the price of those products.