Friday, August 19, 2005

Friday Night Swarthmore Blogging

Randy Goldstein '05 has an argument with Yale economist and tea hawker Barry Nalebuff published by Tyler Cowen. Randy's opening salvo is here, and Nalebuff's response is here.


Anonymous Anonymous said...

I'm confused, but this is where I'm not an economist, I suppose.

What confuses me is this: "tea's bitterness" and "nice sweetness" are pretty well subjective things, yes? You can only assume you know anything about either of those assetions on the market side if you assume a pretty evenly distribution curve of preference for sweetness in tea, with the top of the curve right where the little Green Dragon graph shows it.

My question is, how do you know that? In a market where "tea in a bottle" generally means "extremely sweet", how do you know what the actual preference is? If you were serving "Honest Tea", wouldn't you have a tea without sugar and invite your consumers to sweeten it with sugar (or honey) as they desire? Isn't this rather like salt-in-the-beer, a la Adam Smith? Why isn't "honest" defined by offering a "single-axis" taste (tea) and allowing consumers to move the product along a second axis (sweetness) as they see fit?

T. Burke

8:25 PM  
Blogger henry said...

Well, I don't think those confusions don't have much to do with not being an economist. I'm really not sure why "honest" translates into "less sugar" since they both list nutritional facts and so forth. But it may have something to do with their use of organic ingredients.

11:30 PM  

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