Sunday, August 17, 2003

Plywood Cows and Capitalism

One of the most interesting/wonderful/amusing things about capitalism is that fact that it is so spontaneous and unpredictable. When people have disposable income that they are free to spend in any way they please, there is absolutely no way to predict how they will spend it. Nor is there any way to predict what ideas people will come up with for consumers to spend their money on. Take, for example, this form of spending:

We can assume from the sign that Debbie is having a birthday. Her friends or family want to help her celebrate her birthday. So they rent a set of plywood cows from a company called Lawn Announcements. For the privilege of having 30 plywood cows in the yard, customers are willing to pay $40 for one day of fun (or $45 for three days).

You can imagine how Lawn Announcements got its start. Most likely, someone was having a baby. A friend thought, "Wouldn't it be a hoot to put a giant blue plywood stork in the yard and make a big deal over the baby's arrival?" So the friend did it. When the friend did it, he/she got an unexpectedly large positive response from it. At some point he/she realized people would be willing to pay money to rent large blue plywood storks. A new business was born.

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