5 Basic Principles of Economics

Thinking Like an Economist

Tag: News

  • Navigating Tariff Uncertainty using Inventories

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    People in Canada are thinking about the tariffs, retaliatory tariffs, reciprocal tariffs and threats of more from the US. There was a time before and, eventually, markets will adjust to the time after. The challenge is to manage the time in between. The media focus on layoffs and, until other buyers can be found, production…

  • Thinking Strategically while Getting Punched in the Mouth

    Thinking Strategically while Getting Punched in the Mouth

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    Canada, and other countries, were just punched in the mouth by the threat of tariffs imposed by the US. When faced with a problem, some people propose a “plan” to fix it but a plan is not a strategy. Strategizing is hard work. Some memorable quotes offer memorable advice.

  • What are the Effects of Tariffs on a Nation’s Wealth?

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    This old question has been given new life by the inauguration of Donald Trump as President of the United States of America. Using tariffs to “fix” a trade deficit is seductively appealing but, like other zombie ideas, it relies on a misunderstanding. In this case, it ignores two basic principles of economics: opportunity cost and…

  • Economic Impact of a Dragon Year: Luck vs. Reality

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    The Year of Dragon is believed to auspicious and lucky in Chinese culture. Research has found that more than the usual number of babies are born in China during Dragon Years, and that there are more marriages than usual. Then what? To recognize the end of the Year of the Dragon and the start of…

  • Achieving your New Year’s Resolutions: The Margins Principle

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    People state New Year’s Resolutions (“stop drinking”, “stop smoking”, “lose 30 pounds”, …) to make a big improvement in their life. Famously, most fail. This issue is not isolated to decisions made on New Year’s Day or to people trying to make themselves better. There are deeper lessons to be learned: thinking about the margins…

  • Unexpected Economic Insights During Christmas

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    Christmas is an enjoyable time for many, including many non-Christians living in countries where Christians are a minority. It is a time for presents and food and thinking of others. This post identifies some unexpected ways that the five basic principles of economics appear during this time. Familiar attempts to apply economic ideas to Christmas…