Tuesday, May 28, 2013

This Is Either a Great Economics Lesson or a Terrible One

Elliot and I were doing laundry on Monday when he mentioned that he had found four pennies. He asked whether the money could pay for the washing machine, but I told him it didn't take pennies (and since the large washers cost $3.25 a pop, his contribution wouldn't go far anyway).


Elliot repeatedly asked what he could buy with his four cents, and I was straight up with him: nothing. I explained that there was penny candy when I was a kid, but things were more expensive now. Since we were headed to the neighborhood Gristedes after doing laundry, I invited him to find out for himself.

That's when things went awry.

As we were leaving the building, Elliot showed his pennies to the doorman. The doorman said he had some coins to contribute to the collection, and Elliot was soon in possession of nine cents (a 125 percent increase on his investment).


When we got to Gristedes, I repeated the idea that they didn't sell anything for less than a dime (or a dollar, really — Gristedes isn't known for its low prices).

Elliot found some guys in the deli department and asked whether they had anything that costs nine cents. The guys looked at each other and one of them said, "How about a cookie?"

The worker took a cookie out of a prepackaged box sitting out on a table and brought it behind the counter. Then he gave it a new label with a cost of exactly nine cents.


My first thought was: What happens to the person who buys those cookies and gets one fewer than a dozen? (Is this the opposite of a baker's dozen?)

Second: Now we've created a paper trail! Could the employee be terminated for this offense?

Nevertheless, it was a sweet gesture. And Elliot was thrilled that he had proven Daddy wrong and gotten something for nine cents. (Daddy doesn't know anything.)

On the way to checkout, Elliot wound up losing one of the pennies in the orange-juice area. So I had to agree to buy the cookie and loan him one cent.

In the end, I'm not sure what the lesson is here. He conned his way into a cookie by being cute? That's probably not going to work as well when he's 23. Or did this put him on a path toward developing Warren Buffett-style negotiating prowess?

Either way, the experience undermined his dad's credibility. Thanks a lot, everyone.