Wednesday, January 25, 2012

Economics in Castaway

Have you ever thought about how movies and television shows incorporate economics into the story plot? Well I found a blog post that talks about how economic aspects are incorporated into the movie Castaway starring Tom Hanks. Castaway is about a Fed Ex employee (Tom Hanks) who is stranded on a deserted island for four years. On this island he is forced to live without specialization, where the most valued jobs get paid the best. This is ironic because his job before landing on the island was delivering special packages around the globe so that people could specialize in their comparative advantage. Also Castaway showed how scarcity of resources effected his goal of survival. In the video found on the blog post, it shows how resources like seeds or communication tools mean more to the person stranded on an island than a person who has those resources around them every day. To a person like the women on the video, bottled water and matches are not as valuable than a thousand dollar necklace. To Tom Hanks in Castaway, water and matches are scarce resources and are probably the most valuable things that could be in their posession. Value is all based on the situtation that a person is in at the moment and the resources that are scarce at the moment.


Smith said...

As Derek likes to say it’s all “value based judgments”. This was a great example of scarcity and paradox of value. My question for you is, you mentioned comparative advantage, do you know what it means?

Lindsay said...

Comparative advantage is when individuals or countries produce goods at low costs and trade with other countries for goods at relatively low costs. For example, Alaska produces salmon at low costs because it is commonly found and is they have more workers who specialize in catching and producing salmon for production. Brazil produces coffee at low costs also because of specialization of labor. Instead of them both producing coffee and salmon, they trade their products at low costs. It is cheaper and less time consuming for Alaska and Brazil to produce one good and trade for the other one that try to produce both. Opportunity cost is the key to comparative advantage. For Alaska and Brazil their opportunity cost is producing one good not two, but it is the better decision for time consumption and money. Also specialization of labor is a big part of the comparative advantage because one country or individual could specialize better in one good than the other. Specialization causes the good that is specialized to be easier and faster to make than the other one. Like for the Alaska and Brazil example, it is easier for Alaska to produce salmon because they are closer to the ocean than Brazil is.

Erin said...

This is an interesting discussion considering we discussed this same situation in class. If we were stranded on an island what would be valuable to us? It probably wouldn't be our phones, but rather a bottle of water. Also, I like how you mentioned the irony of the movie and our economy. Before he was stranded on the island he gave people the necessities to produce in the most efficient way.