Economics eductor. Follow me @Wootenomics
It’s Black Friday and customers are in a rush to get the good deals. Before Dina can unlock the doors, the crowd knocks the doors down and rush for the deals. These low prices will cause a shortage and impact the allocation of items among consumers.
As customers stand outside waiting for the store to open, one of them offers Mateo and Cheyenne $40 each to put aside one of the TVs that is on sale. Because prices are so low, there won’t be enough for all of the customers that want a TV, creating a shortage among the waiting customers. Having people wait in line helps allocate the items based on people’s willingness to spend time rather than money, but this man would prefer to have the item allocated through a black market transaction.
Amy’s husband has started working at the store as a temporary employee, but Amy has asked Glenn to have their shifts switched. Glenn asks if the request is because the spark is gone in their marriage or if they are just in a rough patch. His implication is that they have been together long enough that their utility isn’t constantly increasing. Amy is concerned about working with her husband because she knows that their happiness is interdependent.
It’s the holiday season and Cloud 9 needs more help. Labor is a derived demand, which means when customers demand more products, the firm needs more inputs. This temporary employment will also affect the unemployment rate in the local economy. After the holidays are over, many of the new hires will be released.
Glenn is interviewing different candidates for the store’s open Santa position. One of candidates was trained by a legend who worked at the Chicago Macy’s and feels he has amassed enough human capital to be perfect for the Cloud 9 position. The interviewing process takes time and includes costs that aren’t monetary. Glenn could spend his day managing his employees, but he’s spending his time searching for a good match.
Glenn announces a winner of the search for the store’s new Santa position. When the winner asks about the salary, Glenn tells him that he will be paid in smiles and wonder and so many other things. The winner quits, along with almost everyone else. There is one person who stays: an employee of the store.
Jonah is happy that he won the betting pool over which temporary employee would quit first, but it turns out that a lot of these temporary employees are part of a program at Glenn’s church that works with people who have trouble getting jobs. Many of the employees have criminal records or are former drug addicts, and that makes them less likely to be hired without assistance.
The employees are in a betting pool to see which temporary employee will quit first. For each temporary employee, the original employees are trying to make the work experience less enjoyable than the alternative option of quitting. By doing this, they are increasing the opportunity cost of continuing to work. Their tactics range from emotional stress, manual labor, sexual harassment, and increasing the risk of injury.
Dina and Glenn accidentally ruined some ballots by spilling a pot of coffee. They are worried they will be accused of tampering with ballots and face jail time. If they both stay quiet, then nothing will likely happen to either of them. There’s an incentive to confess and try to get the other in trouble, but they both know who would responsible. Since they do not trust each other, they try to set each other up by pretending to be each other and recording their voices. This serves as a credible threat in the case that one of them rats the other out.
Cheyenne and Bo have decided to move their wedding date forward in an effort to end their constant bickering, and Glenn is there to help. He calls his church to see if there’s an open date in the near future. It turns out his church acts just like other monopolistically competitive firms by offering differentiated services, like the option to select either a white or black choir. They practice price discrimination by rewarding Glenn with referral points to the gift store and offering a nuptials package that entitles Bo and Cheyenne to 50% off a baptism.
Teaching with Superstore