"shortage" has no meaning in economics https://twitter.com/Static__Age/status/1316359724321910785 …
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Replying to @MorlockP
idk, I'd call "insufficient quantity supplied to meet quantity demanded" a "shortage" in classical microecon that can't happen, but, frictionless vacuum and all, IRL it sorta often does price ceilings, sudden demand spike (hi 2020), etc etc
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Replying to @ded_ruckus
neither quantity supplied nor quantity demanded are numbers; they are curves curves that intersect SOMEWHERE
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Replying to @MorlockP
? usage I learned was that "supply" is a curve, "quantity supplied" is a number at a specific price point so if you've got a shortage, that indicates that your price point is too low ...but that happens IRL somewhat often, for whatever reason
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Replying to @ded_ruckus
supply is a curve and demand is a curve, and the point of intersection gives you quantity supplied / demanded, and price supplied / demanded
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Replying to @MorlockP @ded_ruckus
let's say that you want to hire pizza deliver drivers, and if you can get them at $10/hr you'll take 3, at $5/hr you'l take 10, and at $15/hr you'll take 1 there's a related supply curve: how many will work at various prices you offer you don't know what the market will bear >
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Replying to @MorlockP @ded_ruckus
you try offering $5/hr and get 0, you up your offer to $10/hr and you get 3 who apply - so you're set. You've learned a little bit about the supply curve. You know where it intersects your demand curve.
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Replying to @MorlockP @ded_ruckus
ⓘ Dogs don't have thumbs Retweeted Dedicating Ruckus
"price at which transactions are happening" IS the market clearing price, unless you want to explain some weird situation I'm not thinking ofhttps://twitter.com/ded_ruckus/status/1316441817416597505 …
ⓘ Dogs don't have thumbs added,
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Replying to @MorlockP
I'm thinking of like Venezuela or whatever, where they put a price ceiling in place, so you've continually got empty shelves because the quantity supplied at the price ceiling is less than the quantity demanded at that price ceiling
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Replying to @ded_ruckus @MorlockP
or (qualitatively but not quantitatively similar) the early 2020 runs on toilet paper etc., when stores were reluctant to increase prices drastically for various reasons (friction-related?), so lots of empty shelves on a temporary basis
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yes, I agree that shortages happen in the short run / if markets are not free to adjust (as with "stores don't want to burn their customers good will")
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