There’s something nice about waking up every day excited for school. I generally start class around 9:30 and end at 6:00 every day but even though I’m drop dead tired by the time I walk back to my apartment, I feel productive and proud of my use of time. I’m actually excited about at least 6 of the 7 classes I am taking this semester because they all delve into subjects I am interested in. Even Korean 7A, a literature requirement where we study ancient folklore and history of Korea, has become a class I look forward to attending.
Sadly, I don’t find myself too interested in my Economics class, simply because I find the study of the graphs tedious. Not to mention, some of the concepts don’t make any sense to me. We had a problem that said, “An earthquake hits a neighborhood, destroying 10% of houses in the area. Draw the supply and demand graphs.” So this is a fairly simple econ problem but to my surprise, I discovered in my section that the only change that happens to the graph is an inward shift of the supply curve, but the demand curve remains unchanged. So I can understand the supply part, obviously if 10% of the houses are destroyed, there’s less supply but who in the right state of mind would want to purchase a house in a neighborhood that just got destroyed by an earthquake? Am I just bad at economics or am I the only one who thinks that in the real world, the demand curve would go down as well? There’s an obvious reason why no one bought airline tickets right after 9/11.
So that was my little economics rant that I still can’t understand and if someone could please enlighten me or prove me wrong, please do so in the comments.
Apart from that, classes are still fun. I apologize for the lack of interviews lately but I’m taking a class that has weekly speakers who have acclaimed positions in well-established companies so I’m thinking of doing a multi-part segment for www.kevinleeme.com where I try my best to transcribe the main points I found most interesting in these lectures. We’ll see how it goes.
hey hulk, i dont know if this will make sense, but here goes. since the supply goes down, the price would be higher, which would change quantity demanded, not demand itself. the determinants of a shift in demand would be like change in preference, change in a similiar good stuff like that. i think youre just trying to apply macro principles to a micro problem haha.
the 9/11 thing is macro as opposed to this problem which is micro so its not really comparable i think. heres a paper on the negative shift in demand in airlines after 9/11 if youre interested. its pretty heavy stuff, but what i got from it is that there are so many other factors contributing to that negative shift in demand that cant be explained by 9/11 http://www.brown.edu/Departments/Economics/Papers/2003/2003-16_paper.pdf
hope this helpz
you’re right that there is likely to be a shift in demand, but you’re thinking too much and making the problem more complicated than it really is. often, whenever there is flux in demand or in supply, the other changes in response to it. but the response is rarely instantaneous, and even if it is, the problems we do to study economics are supposed to illustrate the situation the instant it happens, regardless of any future responsive shifts.