8.21.2005
The Politics of Ice Cream (RawStory.com)
LESSONS LEARNED
By John Steinberg | RAW STORY CONTRIBUTOR
It is funny what we remember and what memories went AWOL with the brain cells snuffed in the fear-and-loathing days of yore. I was an economics major in college. I can’t remember most of it – the equations, the graphs, the justifications for shafting the poor. But I do remember the lesson about the two ice cream vendors on beach.
Assume a beach that is 100 yards long. (It wouldn’t be an economics story if you were not asked to assume something, right?) Now assume that there are two ice cream vendors working that beach, and that people are uniformly distributed on that beach. Where should the vendors set up? You might think vendor A should set up at the 25-yard mark and vendor B at the 75-yard mark – that way, no one has to walk more than 25 yards to get their ice cream. But look at it from the standpoint of the vendors. Vendor A could move to the 30-yard line and pick up a little business at the other vendor’s expense, and run no risk that the customers who now have to walk 30 yards would choose instead to walk 75 yards to vendor B’s stand. Vendor B then gets more business by moving to the 65, Vendor A to the 40, and pretty soon the two competitors are cheek by jowl, straddling the center. Voilà – a dysfunctional outcome, courtesy of the free market.
It turns out that this concept is pretty commonly taught (something I didn’t know in those pre-Internet days) – it is formally known as Hotelling’s model, after an economist named Harold Hotelling. And its application to politics is rather obvious.
Think of the spectrum of political views as the beach, and citizens as sunbathers. A politician on the left end of the beach knows that if he moves his offering a few steps to the right, he can pick up some middle-of-the-beach customers without losing the folks to his left.
(More ... The Raw Story | Politics of ice cream) ¶ 19:16
By John Steinberg | RAW STORY CONTRIBUTOR
It is funny what we remember and what memories went AWOL with the brain cells snuffed in the fear-and-loathing days of yore. I was an economics major in college. I can’t remember most of it – the equations, the graphs, the justifications for shafting the poor. But I do remember the lesson about the two ice cream vendors on beach.
Assume a beach that is 100 yards long. (It wouldn’t be an economics story if you were not asked to assume something, right?) Now assume that there are two ice cream vendors working that beach, and that people are uniformly distributed on that beach. Where should the vendors set up? You might think vendor A should set up at the 25-yard mark and vendor B at the 75-yard mark – that way, no one has to walk more than 25 yards to get their ice cream. But look at it from the standpoint of the vendors. Vendor A could move to the 30-yard line and pick up a little business at the other vendor’s expense, and run no risk that the customers who now have to walk 30 yards would choose instead to walk 75 yards to vendor B’s stand. Vendor B then gets more business by moving to the 65, Vendor A to the 40, and pretty soon the two competitors are cheek by jowl, straddling the center. Voilà – a dysfunctional outcome, courtesy of the free market.
It turns out that this concept is pretty commonly taught (something I didn’t know in those pre-Internet days) – it is formally known as Hotelling’s model, after an economist named Harold Hotelling. And its application to politics is rather obvious.
Think of the spectrum of political views as the beach, and citizens as sunbathers. A politician on the left end of the beach knows that if he moves his offering a few steps to the right, he can pick up some middle-of-the-beach customers without losing the folks to his left.
(More ... The Raw Story | Politics of ice cream) ¶ 19:16
