Part Two of a series where I attempt to explain basic economic
principles through the dating scene in Hong Kong (and globally, really).
Q: It’s a tough market out there, and I’m
not exactly a 10 out of 10. Will I still have a shot at love?
Everyone has a shot at love, my dear. Thanks
to genetic diversity, different people have different tastes. If everyone were
equally attracted to Brad Pitt’s pheromones, our species would actually be
worse off as a result, its homogeneous blond-hair-blue-eyed gene pool
susceptible to the whims of various pathogens, as extinction looms ominously on
the horizon. Granted, there are some people who always seem to attract a higher-than-average
number of suitors due to the possession of certain “superior” traits such as
“charisma”, “looks”, and “intellect”, but fear not and believe in your own market
value in this colorful, bio-diverse world!
Still feeling insecure? Perhaps it’s time
to discuss the concept of advantage
in economics. What you’re fearing is absolute
advantage—in economic terms, the ability of a party to produce a greater
quantity of good, product or service than its competitors using the same amount
of resources. In dating terms, absolute advantage represents the person who
always manages to be the most beautiful, charming, intelligent and generous in
every situation, subsequently crushing all competition with minimal effort as others
weep on their treadmills, realizing the futility of those hours spent working
out and counting calories. In pictorial terms, absolute advantage is this face:
And this:
Okay, I’m just indulging myself at this
point…you get the idea.
Q: Wait, weren’t you supposed to be
encouraging me? How can I survive in the face of absolute advantage? What’s the
point of even trying?
Well, thank goodness there is an economic
precedent to your crisis! In 1817, David Ricardo developed the theory of comparative advantage while thinking
about international trade. He basically asked: what happens when a country just
doesn’t have an absolute advantage in producing anything? And basically
concluded: it would still benefit from trading with other countries because it has
a comparative advantage in something! His example involved Portugal, England,
wine and cloth, but since everyone likes pictures of men let’s try to explain
the power of comparative advantage in another way.
Meet Elon Musk:
Now, meet Shrek:
Elon Musk is a serial entrepreneur,
inventor, billionaire, and visionary. Shrek is an angry green ogre who loves
living alone in his swamp. It’s pretty obvious that Elon Musk has an absolute
advantage here, so why should Shrek even attempt to venture out of his swamp to
find love? The answer has something to
do with opportunity costs. Even though Elon Musk is objectively better at
everything, it’s not actually worth his time to become a master of all trades,
as some activities have significantly higher opportunity costs than others. For
example, I’m sure Elon Musk has the resources to become a fashion icon, but choosing
this path would mean sacrificing resources (time, money, brain power) that
could have gone into more meaningful, lucrative opportunities such as, oh I
don’t know…colonizing Mars. Also, he would probably derive less satisfaction
from being voted People Magazine’s Most Beautiful Man versus successfully
establishing a colony on Mars. Thus, being fashionable is not an optimal choice
for him as the opportunity costs are too high.
Now, this is where Shrek stands to gain. No
matter what activity Shrek pursues, his opportunity costs are low—I hate to be
a cold-blooded economist here, but it’s not like he has a career as a rocket
scientist to give up, a beautiful face to ruin, or a family to forsake. In
order to charm the ladies, Shrek can take advantage of Elon Musk’s overabundance
of talent and pursue those activities that come at high opportunity costs to
Musk. Since Shrek has absolutely no interest in fashion, he decides to devote his
resources to developing a sense of humor, a trait that is less essential for
Musk. Gradually, Shrek becomes an expert jokester and, while not as magnetic as
Elon Musk, succeeds in carving out his own niche as the “not handsome, but omg
he’s soooo funny” guy.
And that, my friends, is the theory of
comparative advantage—nations/firms/individuals should specialize in goods or
services in which they have the lowest opportunity cost. Thanks to comparative
advantage, both Elon Musk and Shrek can now participate in the dating market despite
the disparity in their abilities. Also, the overall dating market is enriched
due to specialization. Ladies are no
longer force-fed just one “perfect” fruit, but can choose among apples,
oranges, strawberries, Shreks...
Q: Wow, so you’re saying I have a chance
against the Brad Pitts of the world if I learn how to specialize?
Yep! (Unless you specialize in something in
which there is absolutely no demand for...) Actually, this theory is already evident
in our society today, and the best proof of specialization can be seen in none
other than the boy bands of our generation. Through specialization, they have
achieved unprecedented levels of success and showed us that the market
appreciates having more choices rather than one!
Exhibit 1: The Backstreet Boys
Exhibit 2:One Direction
That's more than enough pictures of men for one lesson, so hope you feel more confident about your market value and, like Shrek, find your niche now! For Part III, we'll take a break from pictures and bring back the charts...
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