The Economics of The Office

Learning economics from the world's best boss

Arbitrage

In this example Dwight exploits an arbitrage opportunity. He buys a good at a low price and then sells it at a much higher price. We think in efficient markets consumers or firms will look to exploit these opportunities until they no longer exist.

Season 4 Episode 16 "Did I Stutter?"

Information and Market Efficiency (G14) Microeconomic Behavior: Underlying Principles (D01)

Dwight Andy

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Dunder Mifflin Infinity

In this clip (from deleted scenes) we can demonstrate a good example of structural unemployment. Due to an advance in technology the skills of the Dunder Mifflin accountants will no longer be needed. Obviously from here students may want to discuss cyclical and frictional unemployment (which can be demonstrated when Michael foolishly quits his job with no real plan for his job search in season five).

Season 4 Episode 3 "Dunder Mifflin Infinity"

Technological Change (O30) Unemployment (J60)

Michael Pam Ryan Oscar Angela Kevin

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Babysitter

In this clip, Jim and Pam discuss how difficult it is to find a good babysitter for their kids. They are only willing to hire a babysitter with highly specialized skills. Therefore, they should be expected to pay a premium price for a sitter. It's not that there is a shortage of available babysitters as much as there is a shortage of sitter who have demonstrated the skill set they think is required.

Season 4 Episode 3 "Andy's Play"

Information and Market Efficiency (G14) Microeconomic Behavior: Underlying Principles (D01)

Pam Jim

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Flowers

In this clip, Michael tries to buy flowers only to discover how expensive they are. This is a good example of the relationship between price elasticity of demand and the availability of substitute goods. Also we see that when the price of a good is above someone's reservation price, they will either go without the good or purchase a substitute good.

Season 4 Episode 3 "Andy's Play"

Microeconomic Behavior: Underlying Principles (D01) Market Structure and Pricing (D40)

Michael Phyllis Stanley

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Jacket

Kevin buys a jacket. Students should be able to demonstrate that putting Kevin's name on the jacket shifted his demand curve for this good to the right.

Season 4 Episode 3 "Andy's Play"

Microeconomic Behavior: Underlying Principles (D01)

Oscar Kevin

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The Proposal

Jim pays for fireworks at Toby's farewell party so that he can propose to Pam. Doing so creates a positive externality for everyone at the party. Fireworks are a common example of a public good, because they are both non-rival and non-excludable. This makes it easy for individuals to free ride, utilizing the public good without contributing to its production. Jim learns this first hand when Andy makes the most of the romantic atmosphere.

Season 4 Episode 19 "Goodbye, Toby"

Externalities (D62) Microeconomic Behavior: Underlying Principles (D01)

Phyllis Pam Jim Andy Angela Toby

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