Wednesday, December 11, 2013

The Planet Money T-Shirt is Going to Have a Huge Black Market

Planet Money, a fantastic radio show/podcast/blog popularizing economics has recently been working on a cool project following the complete supply chain of a simple branded cotton t-shirt. The idea is an extension of the book Travels of a T-Shirt by Pietra Rivoli that many of us probably read in an introductory macroeconomics class.

Delivery of the shirts is fast approaching, and naturally the coverage and publicity of the endeavor is increasing. Strangely, however, only people who pre-ordered the shirts months ago during the very earliest phase of the project will be able to purchase them. If you've recently been turned on the the show, or are just now hearing about these t-shirts, you're out of luck. My prediction is that the buzz surrounding these shirts will generate considerably more demand than the fixed pre-ordered stock, creating a financial incentive for certain enterprising econ nerds to resell them on a secondary market.

I suspect that encouraging this behavior may have been the Planet Money team's plan all along, and covering the secondary market would be a great opportunity to do a show on price discovery and the role that prices play in revealing information about consumers.

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