Pur Autre Vie

I'm not wrong, I'm just an asshole

Tuesday, March 13, 2012

Curves and Sexiness

This is a quick note on the plausibility that a decrease in demand for men on the LTCR market might actually increase the price for men on that market. It is a response to Sarang's comment to the previous post.

Let's start with a traditional supply/demand model. Take apples. Farmers grow apples and supply them to the market. Consumers buy apples for food. For our purposes, it doesn't matter how the apples move from orchard to table.

So we have a supply curve and a demand curve. The supply curve ordinarily slopes upward with price (a higher price induces an increase in the quantity of apples supplied). The demand curve slopes downward with price (a higher price induces a decrease in the quantity of apples demanded). One can work this out with varying degrees of rigor, but the basic logic should be easy to grasp. Note that the slopes of the curves depend on a number of factors, and may be different over different time intervals. On any one day, a farmer may simply sell all of his ripe apples, regardless of the price. So on any given day, the supply curve may be flat. However, over a longer time horizon, farmers will enter or exit the market depending on the expected price of apples, and so the curve will be upward sloping. (This can get very complicated, but for our purposes it doesn't matter.)

Now, as Sarang has noted, in very rare circumstances you could have an upward-sloping demand curve. A good with an upward-sloping demand curve is called a Giffen good. I'll just let Wikipedia do the explaining.

An important concept is that the supply curve and the demand curve shift independently. This is not always strictly true - one can imagine exotic circumstances in which that is not the case - but generally one thinks of a shift in one curve as constituting a shift along the other curve, which itself does not shift. This is almost universally the assumption in introductory economic courses, and I think it is the default assumption generally. So you can see why Sarang calls foul when I violate it, or when I try to invoke a Giffen good (the existence of which has never been confirmed, to my knowledge).

The LTCR market is not like the market for apples described above. That's because the LTCR market interacts dynamically with the sex market. A "price change" in the sex market will induce shifts in curves in the LTCR market, but "prices" are likely to change whenever there is a move into or out of the LTCR market. That means that it is not exotic for a shift in one curve to induce a shift in the other - it is, in fact, highly likely.

So I am not just invoking Giffen goods here. I am not just raising rare hypothetical cases. The curves in the LTCR market do not function the way they do in the apple market.

3 Comments:

Blogger Unknown said...

ninest123 16.02
prada handbags, ugg boots, jordan shoes, louboutin outlet, michael kors outlet, longchamp outlet, replica watches, louis vuitton outlet, polo ralph lauren outlet, michael kors outlet, ray ban sunglasses, ugg boots, oakley sunglasses, nike free, chanel handbags, ray ban sunglasses, oakley sunglasses, tiffany jewelry, nike outlet, tiffany and co, cheap oakley sunglasses, louboutin, oakley sunglasses, louis vuitton, polo ralph lauren outlet, oakley sunglasses, prada outlet, michael kors, gucci outlet, louis vuitton outlet, ugg boots, michael kors outlet, michael kors outlet, louis vuitton, nike air max, longchamp outlet, louis vuitton, ugg boots, nike air max, uggs on sale, ray ban sunglasses, michael kors outlet, burberry outlet online, longchamp, replica watches, burberry, louboutin shoes, christian louboutin outlet, tory burch outlet

8:18 PM  
Blogger Unknown said...

oakley pas cher, vans pas cher, nike trainers, true religion jeans, abercrombie and fitch, north face, michael kors, lacoste pas cher, nike free run uk, nike roshe, hollister pas cher, hogan, hermes, coach outlet, ralph lauren pas cher, vanessa bruno, michael kors, michael kors, sac guess, nike air max, nike free, air max, timberland, converse pas cher, nike roshe run, sac longchamp, coach purses, burberry, nike blazer, new balance pas cher, ralph lauren uk, true religion outlet, longchamp, lululemon, nike air max, air jordan pas cher, ray ban uk, hollister, tn pas cher, air force, louboutin pas cher, true religion jeans, michael kors, nike huarache, mulberry, ray ban pas cher, longchamp pas cher, true religion jeans, nike air max, north face, replica handbags

8:20 PM  
Blogger Unknown said...

moncler, ugg,ugg australia,ugg italia, canada goose, juicy couture outlet, moncler, barbour jackets, coach outlet, canada goose, canada goose uk, moncler, louis vuitton, replica watches, sac louis vuitton pas cher, doudoune canada goose, louis vuitton, moncler, moncler, thomas sabo, hollister, ugg,uggs,uggs canada, wedding dresses, karen millen, canada goose outlet, swarovski crystal, louis vuitton, canada goose, louis vuitton, pandora charms, barbour, moncler outlet, pandora jewelry, pandora jewelry, ugg pas cher, supra shoes, canada goose outlet, moncler, canada goose, lancel, ugg boots uk, swarovski, pandora charms, montre pas cher, doke gabbana outlet, converse outlet, juicy couture outlet, moncler, toms shoes, bottes ugg, links of london, marc jacobs
ninest123 16.02

8:25 PM  

Post a Comment

<< Home