Science
**The Answer Is Transaction Costs – Michael Munger**

“The real price of everything is the toil and trouble of acquiring it.” -Adam Smith (WoN, Bk I, Chapter 5)
In which the Knower of Important Things shows how transaction costs explain literally everything. Plus TWEJ, and answers to letters.If YOU have questions, submit them to our email at taitc.email@gmail.com There are two kinds of episodes here: 1. For the most part, episodes June-August are weekly, short (20 mins), and address a few topics. 2. Episodes September-May are longer (1 hour), and monthly, with an interview with a guest.Finally, a quick note: This podcast is NOT for Stacy Hockett. He wanted you to know that…..

Latest Episodes:

Dollar Hot Dogs, Coupons, and Bidding for Wallets Jun 27, 2023

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Last week's letter asked about the role of transaction costs in rationing discounted products, or "sales," like "Dollar Hotdog Night!" at the ballpark. As the listener correctly pointed out, this relates to price discrimination, which is a great topic.
And....coupons!
Some additional links and info:

The $21 "Dodger Dog" at Chavez Ravine
The "Monkey App" kerfuffle in the Bay Area
$1 hotdog night at Philadelphia got out of hand, because of course it did
Robert Murphy and the Argument FOR Coupons
Econtalk discussion of "found wallets"
There is no such thing as a free coupon!

If you have questions or comments, or want to suggest a future topic, email the show at taitc.email@gmail.com !

You can follow Mike Munger on Twitter at @mungowitz

Women in Prison, and ALL Costs are Transaction Costs Jun 20, 2023

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Last week's letter asked if charging prices below the "market" price might be rational, but might be an antitrust violation.
The TWEJ is a joke about women in prison for having violated rules against "moral" pricing. The actual cartoon is here, preserved for posterity by the good Timothy Taylor.
Some links, for more information:
Russ Roberts and Michael Munger on John Locke, Prices, and Hurricane Sandy
John Locke, "Venditio"
Guzman and Munger, "Moral Dilemmas from Locke's Venditio," Public Choice.
A "Loudwire" article that fails to understand even basic economics of scarcity.
Mark Perry drops the truth about "Ticket Scalping" and why it happens...
Adam Smith: "The real price of everything is the toil and trouble of acquiring it." (WoN, Bk I, Chapter 5)
Michael Munger, "To the Consumer, All Costs are Transaction Costs." AIER.

If you have questions or comments, or want to suggest a future topic, email the show at taitc.email@gmail.com !

You can follow Mike Munger on Twitter at @mungowitz

Dating, Marriage, and the Costs of Search Jun 13, 2023

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Episode 6 takes up the question of "matching," and the transaction costs of dating and marriage. Some resources:
Ashley Madison: "Is It Real?"
Garrison Keillor, "We are Still Married"
Michael Munger, on "Calculation" and socialist economics, at AIER
Michael Munger and Russ Roberts, on "Econtalk: WIld Problems"
Tyler Cowen and Russ Roberts, on "Making Your Own Economy"
Intellectual Property and the Problem of the Anti-Commons

Background on search cost and optimal stopping:

If you have questions or comments, or want to suggest a future topic, email the show at taitc.email@gmail.com !

You can follow Mike Munger on Twitter at @mungowitz

Roads, Public Goods, and Focal Points Jun 06, 2023

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Episode 5: Notes and Sources
Vaughn Baltzly, "Publicized Goods, or the Promiscuity of the Public Goods Argument." https://www.cambridge.org/core/journals/economics-and-philosophy/article/abs/concerning-publicized-goods-or-the-promiscuity-of-the-public-goods-argument/DE16529B673600C47C22B59C87D198A9

Bruce Benson, "Are Roads Public Goods?"
https://www.springerprofessional.de/en/are-roads-public-goods-club-goods-private-goods-or-common-pools/11240720
Daniel Klein, KNOWLEDGE AND COORDINATION. https://www.amazon.com/Knowledge-Coordination-Interpretation-Daniel-Klein/dp/019979412X/ref=sr_1_1?ie=UTF8&qid=1324300010&sr=8-1

Thomas Schelling, THE STRATEGY OF CONFLICT. http://elcenia.com/iamapirate/schelling.pdf

"Are Roads Really Public Goods?" https://fee.org/articles/are-roads-really-public-goods/
"Economists on Federal Funding for NPR." National Public Radio, PLANET MONEY. https://www.npr.org/transcripts/134863998

"The Fundamental Law of Road Congestion." https://cityobservatory.org/the-fundamental-global-law-of-road-congestion/

"Tolls on the Connecticut Turnpike." https://www.latimes.com/archives/la-xpm-1985-10-10-mn-15553-story.html

If you have questions or comments, or want to suggest a future topic, email the show at taitc.email@gmail.com !

You can follow Mike Munger on Twitter at @mungowitz

Middlemen: From Mancgere to Amazon May 30, 2023

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Does Starbucks have surge pricing?
What is a Mancgere?
Should the Stomach go to the Wheat, or should the Wheat come to the Stomach?
Plus, the TWEJ!
Some things discussed this week:
Michael Munger, "Market Makers or Parasites" https://www.econlib.org/library/Columns/y2009/Mungermiddlemen.html
Frederic Bastiat, WHAT IS SEEN AND UNSEEN. https://www.econlib.org/book-chapters/chapter-chapter-1-what-is-seen-and-what-is-not-seen/
Frederic Bastiat, "The Negative Railroad." https://www.libertarianism.org/publications/essays/negative-railroad
David Friedman, HIDDEN ORDER. http://ndl.ethernet.edu.et/bitstream/123456789/2041/1/47.pdf.pdf

If you have questions or comments, or want to suggest a future topic, email the show at taitc.email@gmail.com !

You can follow Mike Munger on Twitter at @mungowitz

Propriety, Norms, and Traffic Congestion: Episode 3 May 23, 2023

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The third episode for TAITC: First, we take up the question of traffic congestion. Then, does the transaction cost approach have a relationship with moral and ethical theory?
Resources:
Econtalk: Traffic https://www.econtalk.org/michael-munger-on-traffic/
Roger Congleton Book Solving Social Dilemmas
Coase and Epstein: Intellectual Portrait Series, Liberty Fund
John R. Commons, 1931, American Economic Review
Ronald Coase, 1937, Economica
Oliver Williamson, Transaction Cost Economics
Douglass North, Institutions
And of course the TWEJ
The letter, for this week, from Anonymous: Does Starbucks have surge pricing? Once you realize that TAITC, then of course they do.

If you have questions or comments, or want to suggest a future topic, email the show at taitc.email@gmail.com !

You can follow Mike Munger on Twitter at @mungowitz

Exchange Takes "Place," and the Strange Case of Lettuce May 16, 2023

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Why would sellers go to a "place" where many others are also selling the same product? Wouldn't it better to go someplace off by yourself, so you can get the monopoly price? Well, the answer is that transactions"take place," meaning they require a context. Amazingly, it's better to go where all the other sellers are going, because of the problems of triangulation, transfer, and trust. The Sears catalog was a "virtual" (paper) place, and Amazon is another "virtual" (online) place. But the answer to why we do that is "transaction costs."
But then I go back in time to my own introduction to the notion of transaction costs, in a class taught by the remarkable economist Yoran Barzel. The puzzle is so simple that it seems dumb: why do we measure lettuce by the head, meat by the pound, and diamonds by the caret?
Yoram Barzel, Measurement Cost and the Organization of Markets.
The Journal of Law & Economics, Vol. 25, No. 1 (Apr., 1982), pp. 27-48
https://www.jstor.org/stable/725223
Brian Albrecht, Brian Albrecht at Int Cent for Law and Econ
https://pricetheory.substack.com/p/are-transaction-costs-just-costs
Plus, the TWEJ!
And our first letter, as a homework assignment.
Are congestion taxes an effective way to overcome transactions costs pertaining to efficient use of roads? Probably not the best. There is no externality with congestion, because everyone stuck in traffic has moved to the harm. Those who could be held liable for causing congestion are not those who pay for a variable toll, but those who come later.
We'll talk about this in Week 3!

If you have questions or comments, or want to suggest a future topic, email the show at taitc.email@gmail.com !

You can follow Mike Munger on Twitter at @mungowitz

TAITC: Episode 1 May 09, 2023

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The introductory episode for TAITC: "The Answer is Transaction Costs!" The new weekly podcast from Duke University's Mike Munger (http://michaelmunger.com)
If you have questions or comments, or want to suggest a future topic, email the show at taitc.email@gmail.com !

If you have questions or comments, or want to suggest a future topic, email the show at taitc.email@gmail.com !

You can follow Mike Munger on Twitter at @mungowitz

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The Answer Is Transaction Costs – Michael Munger

If you have questions or comments, or want to suggest a future topic, email the show at taitc.email@gmail.com !

If you have questions or comments, or want to suggest a future topic, email the show at taitc.email@gmail.com !

If you have questions or comments, or want to suggest a future topic, email the show at taitc.email@gmail.com !

If you have questions or comments, or want to suggest a future topic, email the show at taitc.email@gmail.com !

If you have questions or comments, or want to suggest a future topic, email the show at taitc.email@gmail.com !

If you have questions or comments, or want to suggest a future topic, email the show at taitc.email@gmail.com !

If you have questions or comments, or want to suggest a future topic, email the show at taitc.email@gmail.com !

If you have questions or comments, or want to suggest a future topic, email the show at taitc.email@gmail.com !

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