Chickenomics

it's only in a private enterprise system a market economy that a chicken could become a national celebrity this is the famous san diego chicken a talented entertainer who uses a variety of comedy routines to help people laugh and enjoy themselves at sports events and other public gatherings he began as a two dollar an hour mascot for a radio station but through his own initiative expanded that job into a comedy act that enables him to earn over a hundred thousand dollars a year it's a unique career that could only happen in a market economy we are all affected by the economy from which we obtain jobs food clothing shelter and recreation therefore if we intend to benefit from the economy we should understand it however an economy is sometimes hard to understand chickens are easier so the chicken is going to help make the economy more interesting and understandable [Music] just over 200 years ago this was a rural country a majority of the people worked as farmers only a small amount of trade occurred at trading posts small stores and farm markets since then our nation has developed one of the largest most complex economic systems in the world with millions of people dependent upon it for the needs of daily living our economy is an unusual system in particular it encourages and rewards creative work that satisfies consumers the economic system is called capitalism an easier name for capitalism is market economy [Music] what is unique about this economy and why are some people more successful than others specifically out of 200 million chickens hatched in this country each year why did this one become a financial success these are questions this story will help you answer our economy has five special characteristics that makes it unique the first of these unique characteristics is private ownership of resources economic resources like tools labor and natural resources are available in different amounts to everyone [Music] how these resources are used has a great influence on a person's success or failure in the economy under our system the chicken is allowed to own his own costume or materials his comedy routines which are labor and other valuable things [Music] [Music] [Applause] [Music] however the chicken may not take resources on by other people like third base private ownership allows a business or an individual to use a resource exclusively others may use that resource only with the owner's permission in this case the stadium operator is on third base not the chicken so he's forced to return it one economic role of the government is to protect property rights you can be sure that had the ball players not made the chicken put back third base the police would have to be successful in the economy an individual must decide how to use available resources in a manner that will satisfy consumers the chicken's greatest asset is his specialized use of available labor resources he began by doing light physical work only signing autographs and walking around at sports events advertising the radio station's call letters the chicken then added another type of labor resource imagination and he began to develop comedy routines like this one almost every fan would like to sneak into the opposition's huddle make notes on the coach's strategy then pass on those plays to his own team the chicken pretends to do just that and the ridiculous idea makes people laugh acting out routines like this represented a risk to the chicken's mascot career he had been safe just walking around in his costume but had the spectators not found the chicken's new routines entertaining he would have failed risk taking is important in our economic system no one knows for sure exactly what the consumers want but a producer must try out an idea take a risk in order to succeed influences on the type of work we or an entertaining chicken decide to do can go way back to childhood teachers parents and friends can play a part in career decisions but the economy encourages one special person to influence us most the person is ourself we are encouraged to follow our own self-interest the second basic characteristic of a market economy self-interest means each person is free to decide what work to pursue and how best to obtain economic rewards for instance the chicken's job as a fry cook ended when he suddenly realized that lots of recipes call for eggs to a chicken breaking eggs is no joke employment as a construction worker made him jumpy he dreamed of a career as an athlete the chicken just couldn't get along with his teammates the chicken tried the shoe shine business and found great satisfaction in making those shoes sparkle however the pay was not what the chicken had expected we should note that pay is important but is not the only reason people do what they do many times a job is a means to satisfy one's self-interest even though more money could be made on another job this is why some people become teachers government workers or coaches originally the chicken had not set out to become an entertainer but another economic characteristic often encourages people to pursue careers in which they had never expected to work that's consumer sovereignty the third characteristic of our economic system consumer sovereignty was a prime factor in the chicken's failure as a disc jockey the career he dreamed about as a teenager he got a tryout but did not succeed because he didn't understand the concept of consumer sovereignty he did not play the music that the listeners wanted to hear in fact the only record he played all day long was his own favorite in the mood by the hen house five [Music] when the disc became worn and scratchy the chicken couldn't find a replacement because the record store was stocked with better selling disks this too is an example of consumer sovereignty what most consumers want and are willing to buy is what is produced besides not finding a replacement for his favorite record the chicken discovered that a worker who cannot satisfy consumer demand or a disc jockey who won't play what the listeners want to hear soon will be looking for another job engine 22 ladder 10 you have a house fire at 1426 for crest avenue engine 22 ladder 10 you have a house fire at 1426 fur crest avenue the excitement of firefighting appealed to the chicken so he tried that job unfortunately being on time was not one of his strong points [Music] a job as a waiter ended in disaster when the chicken's tail swept food and water all over a customer the chicken had failed to satisfy the consumer again however when people began to laugh applaud and cheer him the chicken found success people were willing to pay to see him perform again consumer sovereignty was at work without exception more people than expected show up at sports events when the chicken is hired as an added attraction the extra income from these additional ticket sales more than pays for the chicken's appearance thus ticket buyers demonstrating the concept of consumer sovereignty are influencing the operators of sporting events to hire the chicken in the u s economy most transactions take place in markets the fourth important characteristic of a capitalistic economy millions of people in our country all following their own self-interest get together make products develop services and exchange items in the marketplace when economic resources are converted into products like wheat into bread those products are exchanged from the producer to the buyer in markets a market can be a store a mail order catalog a telephone or anywhere a transaction can be made the seller tries to sell the product for a satisfying price and the buyer tries to get a good deal both decide voluntarily to buy or sell in other words the deal has to satisfy both parties or no exchange takes place not only products but services are also sold in the economic marketplace services are actions that people value such as haircuts and manicures or in this case feather cuts and chicken cures barnyard humor aside services include thousands of things like medical care police protection auto repairing and entertainment [Music] instead of being a comic the chicken could have tried to sell other services in the marketplace like being a professional musician perhaps he could have become the young chicken with the horn [Music] he could have become a maintenance man the young chicken with the broom the point is in this economy people are encouraged to sell their skills their work in the marketplace the chicken did this and found that thousands of consumers were willing to pay to see him perform since he did find the right job for him and has become financially successful you might wonder why the chicken doesn't relax and enjoy the good life well that leads us to the fifth characteristic of a market economy competition other entertainers are trying to provide the same service at a lower price so the chicken can't rest on his feathers the chicken was the first professional sports mascot of his kind the demand for his services increased when he added humor to his act when the financial rewards became substantial mascots of all descriptions began appearing on the sports scene if the chicken were to become boring or repetitious other entertainers would be ready to step in and take his place in the same manner each person who finds work will face competition each of us must try to improve our work and provide a valuable service to employers or consumers because a competitor is always ready to step into our job the chicken also experienced competition when he began selling chicken dolls it's the one i want thank you do i pay for it thank you very much at first he found that people lined up to buy his dolls there were more buyers than dolls so he was able to raise the price and make more profit [Music] but high profits attract competition raising the price again look what we've got over here the new improved chicken dials 17 and check this out huh a new long leg a red tongue sticking out slaps the wings just put your name and address down here people found the competitors dolls equally attractive and at a lower price therefore the chicken had to reconsider his pricing policy it's this competition among buyers and sellers that keeps people and chickens from taking advantage of one another or charging too high a price for a product in the marketplace in the market economy every successful product will face competition how that competition is met determines products future what lessons are there in the story of the chicken first of all in this economy a person who finds work that provides sufficient income and personal satisfaction has achieved success although not all successful people will reach the same financial level as the chicken that type of success only comes to people who possess a unique talent or product have little competition and enjoy great public popularity secondly we've learned five basic market economy characteristics that will influence each person who seeks employment and financial security in this country private ownership of resources self-interest motives consumer sovereignty markets and competition if you understand these characteristics you'll have better knowledge of how the economy operates and how you can participate to satisfy your own needs and goals now you know why from millions of chickens this one humorous bird can be successful in our economy that is until it lays an egg any chicken can do that [Music] oh [Music] [Music] my [Music] [Music] back [Music] [Laughter] [Music] ah you