All the World's a Classroom
Economics Is Everywhere
AUGUST 01, 1998 by SHELDON RICHMAN
Filed Under : Scarcity
Economic education can happen any time, any place, at any age. Economics is the study of action and its implications for production and exchange. As such, it is accessible to children from an early age. Since every child acts, chooses, and exchanges, nothing is more within the reach of children than the basics of economics properly conceived. It’s simply a matter of making the implicit explicit.
One of the offenses that the modern economics profession should have to answer for is rendering the discipline dull, dismal, and mostly irrelevant. Had my first contact with the subject been Econ 101 at Temple University, I’d have written it off as useless right there. (On the other hand, had former Temple econ prof Walter Williams been there during my stint, things would have been entirely different.)
No surprise that we find economics lessons wherever we look. Choice is everywhere. It’s made necessary by scarcity, which itself is the result of valuation. Something becomes scarce only when human beings find a use for it. Crude oil was all too abundant until a Yale University chemist distilled kerosene from it in the nineteenth century. Before that, a dirt farmer who found oil would pay someone to take it away. After that, he moved to Beverly . . . Hills, that is. This doesn’t work in reverse: rare things are not necessarily valuable—smallpox, for example.
My daughters, son (ages 14, 12, and 10), and I recently saw a commercial offering lottery winners whose cash would be paid out over 20 years a lump sum right now. “Why would that company or a lottery winner be interested in that deal?” I asked the kids. There ensued a lively discussion of exchange, time, and interest. They had no trouble understanding why someone might trade a million dollars payable at $50,000 over 20 years for something less than a million dollars today. They couldn’t say how much less they would accept, but they got the principle. Actually, we had discussed “time preference” on an earlier occasion, when I asked them to choose between having one candy bar today or two next week. That provoked a good discussion.
Economics is everywhere because alternatives are everywhere. To be is to act. To look around is to find oneself in the best economics classroom.
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