Nov. 22 – Thanksgiving

Gay Lynn HillBell Ringers, Economics(BR)

Thanksgiving is the truly American holiday. Unlike all the rest of our holidays, it is fixed on a Thursday, meaning most people have four days off in a row. And unlike Christmas, it is unconnected to consumerism, so there is far less pre-Thanksgiving anxiety (unless, of course, you’re one of the 7% of people flying to your holiday destination – the day before Thanksgiving is generally the busiest flying day of the year).

So what does Thanksgiving cost? In 2015, the price edged over $50 for the first time. The culprit? You guessed it, the golden-brown bird. This year, however, prices are down again, and we’re back under $50, it seems.

What changed? Before you watch the videos, write down the answer.




It turns out that a few years ago, bird flu hit the turkey world, reducing the supply of healthy turkeys. This, in turn, allowed producers of healthy turkeys to charge higher prices. What happened next?

For some people, at least, it meant less turkey on their plates, or perhaps a switch to some other meat or even a vegetarian alternative.

Turfurky anyone?

Higher prices caused producers to produce more turkeys (7% according to the second video). With more turkeys out there, the price went down.

As a result, producers are having to lower their price, to sell all their birds. Isn’t that amazing!

The key point, however, is that all this happened, and while the producers probably were clued in to the role of bird flu, I doubt many of you were. All you knew or your family knew was that prices went up, so you changed your behavior. Then prices went down. And you’re changing it again. Prices told you there were a bunch of sick turkeys out there. And the also told you there were too many healthy ones, so you could get a good deal this year! And all without a bird thermometer in sight!


Questions
  1. Can you think of an alternative to prices, which would convey as much information? How would you tell the world that turkeys were sick, and you’d need to pay more? How would you tell farmers to increase their flocks? How would you get them to do it (farmers are notoriously independent-minded)?
  2. If we didn’t have prices? How would we substitute a different system?

(Famously, in communist countries, they didn’t have markets to set prices. When once asked how they did so, an official confided that they used the Sears Catalog to set relative prices, then adjusted for political considerations. So even under communism, they needed markets somewhere as a price-setting tool!)


Image Citation:

14, Nov. 2018, Tofurkey Receipe [Digital photograph].  Retrieved from <thespruceeats.com/what-is-tofurky-3376823>.