Elasticity: Curated Media

News & Articles

Massive response to sale prompts Build-A-Bear to shut down lines, offer vouchers  
(CNN) 7/12/2018
The "overwhelming" response to a sale at Build-A-Bear prompted the retailer to turn away customers waiting in long lines outside its stores. Ask your students if they can infer anything about elasticity of demand.
Resources: Multiple Choice Questions

Most Netflix users would pay a lot more for their subscription, survey shows  
(Yahoo! Finance) 5/15/2018
Are your students addicted to Netflix? Then this example might resonate with them. While the headline is a bit misleading, you can use the information given in the article about demand at different price points to calculate (a rough) elasticity of demand for Netflix (FYI —  Netflix has around 125M subscribers). You could even create a poll for your class and construct the class’ elasticity of demand for Netflix for a more personal example.

Facts about (Facebook) Friends 
(Marginal Revolution) 7/25/2017
An oldie, but a goodie. Does distance make the heart grow fonder? Tyler Cowen provides some stats on social connectedness and links to a working paper on the topic. Transfer of learning, anyone?

Podcasts

An Economist Gets Stoned* 
(Planet Money)
What happens to the price of drugs if we legalize them? Well, it depends on elasticity of demand. For more background on the research in this episode, check out Jeffrey Miron’s paper on drug prohibition’s budgetary implications.
*No economists were stoned in the making of this podcast.

Resource: Rebecca Moryll has a class discussion question and a written assignment for this episode at audioecon.com.

Video

Characteristics that Determine Elasticity 
(MJM Foodie)
Using the example of gas to fuel her car, Dr. Mary J. McGlasson gives 
a quick overview of the contributing factors to whether an individual’s demand for a particular good might be elastic or inelastic. So, is Dr. McGlasson’s demand for gasoline elastic or inelastic?

Elasticity and Slave Redemption 
(MRU)
Slave redemption is one of the starkest examples of unintended consequences that we’ve ever heard of. It drives home the point for students that even when you’re trying to do good in the world, understanding economics, including elasticities, is crucial!

Money & Banking

News

What Benjamin Franklin Learned While Fighting Counterfeiters |  The New York Times
July 17, 2023
Franklin used intricate designs, inks, and experimented with unique materials to help distinguish his printed currency from counterfeits in colonial America.

Zimbabwe is launching a local digital currency alternative to the US dollar | Quartz
May 5, 2023
Zimbabwe wants to reduce reliance on the US dollar by offering digital tokens backed by gold reserves. Will these tokens earn acceptance as currency and maintain their value? This article also offers a brief overview of inflation in Zimbabwe since 1998.

FDIC proposes Congress increase deposit insurance limits for payroll accounts | Yahoo Finance
May 1, 2023
In light of SVB’s failure, the FDIC is recommending increasing deposit insurance for businesses. Alternative reform options-insuring all deposits or raising the current $250,000 are also on the table, but all present moral hazard problems.

JPMorgan Chase takes over First Republic after biggest U.S. bank failure since 2008 | CNBC
May 1, 2023
An accessible overview of the latest bank failure for students. Prior to failing, First Republic accounted for 72% of all borrowing from the Fed’s discount window.

First Republic Bank lost $102 billion in customer deposits | The Seattle Times
Apr. 24, 2023
Banks use deposits to make loans. First Republic just reported customers withdrew $102 billion in deposits. In addition to a $30 billion lifeline from large banks, the  bank borrowed $92 billion from the Federal Reserve and government backed lenders to cover the withdrawals. Lots of opportunity to discuss fractional reserve banking, bank runs, and how the Fed acts as a lender of last resort.

The world's biggest banknote printer said the demand for cash hit a two-decade low  | Quartz
April 12, 2023
The use of cash is declining globally as access to digital payment methods becomes cheaper and easier.

It Wasn’t Just Credit Suisse. Switzerland Itself Needed Rescuing | Kanebridge News
March 23, 2023
Switzerland tied its identity to banking the world’s wealthy. The fall of Credit Suisse threatened that identity.

Signature Bank in New York went under on Sunday. Other lenders also named Signature Bank are scrambling to let customers know they're still open for business. | Insider
March 14, 2023
At least 4 other banks named Signature Bank worked to instill customer confidence and reassure customers that despite the similarities in names, their bank was still open for business.

U.S. government steps in and says people with funds deposited at SVB will be able to access their money  | CNBC News
March 12, 2023
Following the collapse of SVB and Signature, the Fed, Treasury, and FDIC released plans to cover uninsured deposits and for the Fed to create a new Bank Term Funding Program.

Why was there a run on Silicon Valley Bank? | Noah Smith
March 10, 2023
A student-friendly walk through explaining the bank run on SVB. Note that this explanation predates Sunday’s joint Fed, Treasury, and FDIC announcement.
Resource: Worksheet

Argentina OKs new 2,000 peso bill as inflation bites, still only worth $5 | Reuters
Feb. 2, 2023
Inflation undermines money’s function as a store of value, but also as a means of exchange. In an attempt to address complaints about the volume of cash needed to make regular payments, Argentina will release a 2,000 peso note. Even so, its value will be much lower than the highest denomination bills of other currencies in the region.
Resource: Worksheet

People are ‘robbing’ banks in Lebanon – to take their own money | Business and Economy News | Al Jazeera
Sept. 15, 2022
Plummeting exchange rates and restrictions on bank withdrawals have created a crisis in Lebanon, with depositors resorting to armed hold ups.

Inside the crypto black markets of Argentina | Freethink.com
August 13, 2022
To better understand the function of banking, it helps to consider what happens when a currency isn’t fulfilling basic monetary functions. Here’s a look at what money and banking looks like in Argentina.

From cocoa beans to cryptocurrency – The evolution of money and the rise of crypto | Benzinga
March 8, 2022
Did you know that cocoa beans and shells of sea snails have been used as a form of exchange in the past? This article provides even more examples of forms of exchange that might surprise you! Finally, do cryptocurrencies serve the three functions of money?

Russians search for cash as west imposes sanctions on banks | Financial Times
February 27, 2022
Immediately after Russia’s president announced that Russia would invade Ukraine, Russians started to form queues in front of banks to withdraw cash. They were worried that the Russian national currency, the rouble, might collapse and they might also not be able to pay with their credit and debit cards.

Venezuela to Cut Six Zeroes Off Bolivar to Simplify Transactions | Bloomberg
July 1, 2021
As it turns out, currency is easier to use when there aren’t so many zeros. 
A good way to foreshadow or transition to hyperinflation.

Podcasts

The banking system that loaned billions to SVB and First Republic  | NPR
Learn more about the Federal Home Loan Bank system and how it operates as a lender of second-to-last resort.

The demise of Credit Suisse | NPR
March 21, 2023
An overview of the crumbling of Credit Suisse.

Money is ‘a made up thing’ – but that doesn’t change rising inflation | NPR
Find out where paper money was invented, and consider what happens when multiple paper currencies circulate. This is a long podcast (34 min) but there is a short summary that your students can read.

How mortgage rates get made | The Indicator
How do mortgage rate changes filter out to the rest of the economy?

The Financial Sector - bonds, stocks, and shares | Think Like an Economist
Stevenson and Wolfers give a really nice overview of what bonds are and why companies issue them.

A Chemist Explains Why Gold Beat Out Lithium, Osmium, Einsteinium... | Planet Money
It turns out there’s an elemental reason behind the use of gold as money. P.S. Did you know that people were using currency for trade as far back as 40,000 years ago?

The popularity of (and problems with) municipal bonds | The Indicator
The terms bonds and funds mystified me for a lot longer than I care to admit. So I’m thrilled when others try to break it down. Three cheers for The Indicator.

10 Years Later, The Financial Crisis Still Resonates | NPR
Take a walk down memory lane, and reflect on the successes and failures of the bank bailouts following the 2008 Financial Crisis.

Video

Founding the Fed | Planet Money
Short entertaining video on the founding of the Fed.

Venezuela crisis: Lack of cash leads to bartering | BBC
What happens when the entire monetary system collapses? A return to a barter economy. How much milk do you want for that fish?

Saving and Borrowing | Marginal Revolution University
Financial Intermedi-what? This video helps students visualize consumption smoothing and loanable funds markets. Follow this up with introductory videos to both stock and bond markets.
Resource: Practice questions

Getting Graphic

Charted: 30 Years of Central Bank Gold Demand | Visual Capitalist
March 15, 2023
In the 90’s, central banks were net sellers of gold. Since 2008, they’ve been net buyers of gold. And in 2022, central banks bought a record 1,136 tonnes of gold. There’s also a breakdown showing which central banks are the largest purchasers of gold.

The world's unbanked, in 6 charts | World Economic Forum
September 6, 2017
How different would your life be if you didn’t have access to savings or credit? Show students how useful financial markets are by thinking about the 2 billion people in the world who don’t have access to them.

Money & Banking

News

What Benjamin Franklin Learned While Fighting Counterfeiters |  The New York Times
July 17, 2023
Franklin used intricate designs, inks, and experimented with unique materials to help distinguish his printed currency from counterfeits in colonial America.

Zimbabwe is launching a local digital currency alternative to the US dollar | Quartz
May 5, 2023
Zimbabwe wants to reduce reliance on the US dollar by offering digital tokens backed by gold reserves. Will these tokens earn acceptance as currency and maintain their value? This article also offers a brief overview of inflation in Zimbabwe since 1998.

FDIC proposes Congress increase deposit insurance limits for payroll accounts | Yahoo Finance
May 1, 2023
In light of SVB’s failure, the FDIC is recommending increasing deposit insurance for businesses. Alternative reform options-insuring all deposits or raising the current $250,000 are also on the table, but all present moral hazard problems.

JPMorgan Chase takes over First Republic after biggest U.S. bank failure since 2008 | CNBC
May 1, 2023
An accessible overview of the latest bank failure for students. Prior to failing, First Republic accounted for 72% of all borrowing from the Fed’s discount window.

First Republic Bank lost $102 billion in customer deposits | The Seattle Times
Apr. 24, 2023
Banks use deposits to make loans. First Republic just reported customers withdrew $102 billion in deposits. In addition to a $30 billion lifeline from large banks, the  bank borrowed $92 billion from the Federal Reserve and government backed lenders to cover the withdrawals. Lots of opportunity to discuss fractional reserve banking, bank runs, and how the Fed acts as a lender of last resort.

The world's biggest banknote printer said the demand for cash hit a two-decade low  | Quartz
April 12, 2023
The use of cash is declining globally as access to digital payment methods becomes cheaper and easier.

It Wasn’t Just Credit Suisse. Switzerland Itself Needed Rescuing | Kanebridge News
March 23, 2023
Switzerland tied its identity to banking the world’s wealthy. The fall of Credit Suisse threatened that identity.

Signature Bank in New York went under on Sunday. Other lenders also named Signature Bank are scrambling to let customers know they're still open for business. | Insider
March 14, 2023
At least 4 other banks named Signature Bank worked to instill customer confidence and reassure customers that despite the similarities in names, their bank was still open for business.

U.S. government steps in and says people with funds deposited at SVB will be able to access their money  | CNBC News
March 12, 2023
Following the collapse of SVB and Signature, the Fed, Treasury, and FDIC released plans to cover uninsured deposits and for the Fed to create a new Bank Term Funding Program.

Why was there a run on Silicon Valley Bank? | Noah Smith
March 10, 2023
A student-friendly walk through explaining the bank run on SVB. Note that this explanation predates Sunday’s joint Fed, Treasury, and FDIC announcement.
Resource: Worksheet

Argentina OKs new 2,000 peso bill as inflation bites, still only worth $5 | Reuters
Feb. 2, 2023
Inflation undermines money’s function as a store of value, but also as a means of exchange. In an attempt to address complaints about the volume of cash needed to make regular payments, Argentina will release a 2,000 peso note. Even so, its value will be much lower than the highest denomination bills of other currencies in the region.
Resource: Worksheet

People are ‘robbing’ banks in Lebanon – to take their own money | Business and Economy News | Al Jazeera
Sept. 15, 2022
Plummeting exchange rates and restrictions on bank withdrawals have created a crisis in Lebanon, with depositors resorting to armed hold ups.

Inside the crypto black markets of Argentina | Freethink.com
August 13, 2022
To better understand the function of banking, it helps to consider what happens when a currency isn’t fulfilling basic monetary functions. Here’s a look at what money and banking looks like in Argentina.

From cocoa beans to cryptocurrency – The evolution of money and the rise of crypto | Benzinga
March 8, 2022
Did you know that cocoa beans and shells of sea snails have been used as a form of exchange in the past? This article provides even more examples of forms of exchange that might surprise you! Finally, do cryptocurrencies serve the three functions of money?

Russians search for cash as west imposes sanctions on banks | Financial Times
February 27, 2022
Immediately after Russia’s president announced that Russia would invade Ukraine, Russians started to form queues in front of banks to withdraw cash. They were worried that the Russian national currency, the rouble, might collapse and they might also not be able to pay with their credit and debit cards.

Venezuela to Cut Six Zeroes Off Bolivar to Simplify Transactions | Bloomberg
July 1, 2021
As it turns out, currency is easier to use when there aren’t so many zeros. 
A good way to foreshadow or transition to hyperinflation.

Getting Graphic

Charted: 30 Years of Central Bank Gold Demand | Visual Capitalist
March 15, 2023
In the 90’s, central banks were net sellers of gold. Since 2008, they’ve been net buyers of gold. And in 2022, central banks bought a record 1,136 tonnes of gold. There’s also a breakdown showing which central banks are the largest purchasers of gold.

The world's unbanked, in 6 charts | World Economic Forum
September 6, 2017
How different would your life be if you didn’t have access to savings or credit? Show students how useful financial markets are by thinking about the 2 billion people in the world who don’t have access to them.