I read on Paul Krugman's blog about this initiative from the Dallas Fed for high school students. Here is a suggestion from the "No county for old men", just reviewed.
This is an example of decision-making under uncertainty. The theory says that if there are two coin toss lotteries, let's say A, and B, which have both known probabilities (50-50) and known pay-offs, a person will choose to participate in the lottery which has the highest expected utility-which is the payoffs coming from head or tails times their respective probabilities.
If you are offered to participate in a lottery in which the probabilities are known but the payoffs are not, you may decide to participate according to your degree of risk aversion: the lower it is, the smaller the payoff increase needs to be to induce you to participate.
In the scene that follows, the shop owner is "offered" to take part in a lottery whose outcome is based on a coin toss. Initially he does not want to bet, because he does not know the payoffs, but then....well, let's see how this works in practice...
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Yeah I always think of economics when I watch movies. For example when I watched American Gangster, I could not think of anything else but the economics of the drug trade. Actually, there is nothing better than an illegal market to study economics, mostly because government regulation is, well in a way, absent.
What happens when a black guy from Harlem destroys the Mafia's monopoly with a better, cheaper product: blue magic cocaine? The Italians do everthing to stop him, to collude, and do not manage to compete. This is the perfect example of how entrepreneurs make people better off, as more competion lowers prices and enhances quality and of how agents behave in a purely competitive environment.
Anyway, for an economics textbook, we could say that this Harlem guy represented progress, or as Schumpeter would say, creative destruction.
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