Economics

Boycott or Buy? Part 2

This entry was posted in Capitalism Economics Election 2004 Libertarianism on by

In Boycott or Buy? Part 1 I encouraged each of you to make your own fair and balanced decision as how you might respond to the Sinclair Broadcasting issue. I still do.
Jim Henley reminds us, though, that it should not be an FCC issue at all:

It may arguably be bad business, in which case they’ll pay, but it’s not the FCC’s business. I enjoyed the hell out of the Sundance Channel’s live broadcast of the Vote for Change finale concert last night. That wasn’t station owners using their facilities for partisan political purposes?
I enjoyed listening to Vote for Change on a local radio station and Jim’s question jumped into mind just about two songs1 in…
I agree with Jim that it should not the FCC’s business. Primarily because the FCC should not even exist.
Sinclair owns the stations so they should be able to broadcast what they want. We can use our channel changers or the power switch to watch or not watch and we can choose to buy or not buy from their sponsors.
However, Sinclair Broadcasting along with their media and corporate ilk exist in the form they do only with the complicity of their regulatory monitors partners and our their executive, legislative, and judicial representatives. As long as this parasitic partnership rides on our backs it seems perfectly reasonable to pour sugar in its tanks and turn one limb against the other to the extent possible.
1I enjoyed almost all the music I heard on this broadcast and these late in the show pieces were amongst my favorites: Dave Matthews performing Don’t Drink the Water and Ant’s Marching and Springsteen’s Star Spangled Banner>Born in the USA.

The Long Tail

This entry was posted in Economics Marketing on by

In this post, Should Government Subsidize Mortgages, Tyler Cowen recommends this book for data on credit rationing. So, I hop over to Amazon to evaluate and what do I find: the price is $115 for a 384 page book with an Amazon sales rank of 1,755,070.
In his next post, Making Money From Niche Demand, he recommends, as do I, this article:

on how falling fixed costs (my terminology) will revolutionize the world of culture.
The long tail is the bottom end of the sales power curve which, according to the article, is where outfits like Amazon, Netflix, Rhapsody and iTunes are getting most of their revenue. For Amazon this is books with sales rank of under 130,000.
I might have considered purchasing Tyler’s book if he had been following some of the pricing suggestions in the article, for instance: Cut the Price in half. Now lower it. Sure, they are talking specifically about downloadable content but if you are ranked 1,755,070 following that suggestion just might move you up the rankings a bit and might make you a bit more money.
Update (10/7): Joi Ito has more on this. Also read the comments to his post for why $.99 might be too low, at least for some types of material.

Government Helping the Needy

This entry was posted in Capitalism Economics FCC Libertarianism Technology Television on by

I know some of you have probably forked over big bucks for that new HDTV set and are enjoying some excellent picture quality. I haven’t and have yet to see one at a size and price point that makes me say, “I have got to have that.” And, I also haven’t seen the value in buying that digital cable package. Basic does just fine for the few hours a week that I watch TV.
Since there are apparently a lot of other folks like me out and about our ever helpful federal government is accelerating its work on behalf of big electronics:

It’s one of the biggest technical changes in television since color TV: the digital transition. And because many Americans remain in the dark about it, federal regulators began an education campaign Monday to enlighten them.
Remind me, please, just why it was congress needed to set a target date for “all digital” and why the FCC needs to be spending tax money to act as the marketing arm for the electronics industry in what seems no more than a wealth transfer exercise.
When the perceived value hits the right point people will buy the stuff in droves.

A Benefit of the Deficit?

This entry was posted in bush Economics Election 2004 on by

In 2003 US business invested $153 billion in foreign countries. This is about 27% of the world wide total foreign direct (FDI) investment of $560 billion and the second largest total on record. Sounds pretty positive.
Until you look at the other side of the picture. Historically FDI in the US has been about 20% of the world wide total and was $314 billion just four years ago. In 2003 FDI in the US was $29.8 billion, 5.3% of the total. Why has then been such dramatic slippage:

One explanation looks to the re-emergence of large budget deficits after the tax bills of 2001 and 2003. These can diminish confidence in America’s longer-term growth prospects, and simultaneously give foreign investors the choice to put money into government securities with a guaranteed return, as opposed to tangible businesses whose future can never be entirely certain. Security concerns and intensive media coverage of recent business scandals may also affect perceptions.
But the US doesn’t really need the jobs that this investment might have created, right?
Read the rest of the story.