You are an everyday economist | Frances Donald | TEDxToronto
Summary
TLDRThis talk challenges the stereotype of economics as a dry and complicated field, emphasizing its accessibility and relevance to everyone. The speaker, an economist and millennial mom, debunks misconceptions and explains fundamental concepts like supply and demand, using relatable examples. She argues that economics is about making decisions with limited resources and encourages viewers to engage with intimidating subjects, highlighting subfields like environmental and feminist economics that aim to improve societal issues.
Takeaways
- đ Economics is often misunderstood as being solely about money, but it's more accurately described as the study of how to allocate scarce resources.
- đ©âđ« The speaker, a chief economist and millennial mom, aims to make economics accessible and engaging for everyone, challenging the stereotype of the field.
- đ Economics doesn't require a PhD or a beard; it's about understanding basic concepts like supply and demand, which even non-economists can grasp.
- đ The example of limited-edition sneakers illustrates the concept of supply and demand, showing how scarcity and desire can drive up prices.
- đ Everyday choices, like comparing prices online, are economic decisions that demonstrate an understanding of supply and demand.
- đ The potential growth rate of an economy is tied to labor force participation and productivity, which can be understood through simple, relatable examples.
- đ By relating economic concepts to familiar scenarios, like a burger joint's output, complex ideas become more digestible.
- đ Economics encompasses a wide range of subfields, including environmental, stratification, and feminist economics, which aim to address societal issues.
- đȘ Economists can be agents of change, using their understanding of economic systems to advocate for improvements and a more sustainable future.
- đ€ The speaker encourages viewers to engage with intimidating subjects, ask questions, and seek out accessible explanations to demystify complex topics.
Q & A
What is the common misconception about economics mentioned in the script?
-The common misconception is that economics is strictly about money, but it is actually the study of the allocation of scarce resources in a given constraint.
What does the speaker suggest is a better definition of economics?
-A better definition of economics is that it's the study of the allocation of scarce resources in a given constraint, which is more universal and applicable to various aspects of life.
Why does the speaker believe that economics is accessible to everyone?
-The speaker believes economics is accessible to everyone because it involves making decisions about limited resources, which everyone does in their daily life, even if they don't realize it.
What is the fundamental concept in economics that the speaker uses to illustrate the point that economics is not complicated?
-The speaker uses the concept of supply and demand to illustrate that economics is not complicated, as it is a basic idea that most people understand even without a formal education in economics.
How does the speaker use the example of sneakers to explain the concept of supply and demand?
-The speaker uses the example of limited edition sneakers, where the supply is low and the demand is high, leading to higher prices, to explain the concept of supply and demand.
What is the potential growth rate of an economy according to the script?
-The potential growth rate of an economy is the economy's ability to grow, measured as the change in labor force participation rate plus the change in productivity.
Why have economists become concerned about the slowing of economies?
-Economists are concerned because economies have been growing at a slower rate than in the past, which could indicate a loss of potential growth and prosperity.
What does the speaker suggest is necessary for economies to live up to and grow their potential?
-The speaker suggests that having big conversations about affordable child care, public transportation, competitiveness, and retooling the economy towards sustainability and inclusivity is necessary for economies to live up to and grow their potential.
How does the speaker describe the role of economists in society?
-The speaker describes economists as change makers who can contribute to improving the world through various subfields of economics, such as environmental economics, stratification economics, and feminist economics.
What advice does the speaker give to people who encounter daunting subjects like economics?
-The speaker advises people to not shut off or avoid daunting subjects but to engage with them, ask questions, and seek out resources that make these topics accessible.
What is the speaker's final message about the importance of understanding and engaging with economics?
-The speaker's final message is that understanding economics is critical in the current historical moment and that everyone has the tools and confidence to engage with and learn about economics, even if it seems hard at first.
Outlines
đ Economics Made Accessible
The speaker, an economist and millennial mom, challenges the common perception that economics is a dry, complicated field. She emphasizes that economics is about the allocation of scarce resources within constraints, not just about money. Using the example of supply and demand, she illustrates how this fundamental economic concept is relatable and understandable to everyone, even without a formal education in economics. She also highlights how everyday decisions, such as comparing prices online, are economic in nature, and how even during the pandemic, people demonstrated an understanding of economic principles when they were willing to pay higher prices for scarce goods like toilet paper.
đ Understanding Economic Growth and Potential
The speaker delves into the concept of economic growth, explaining the potential growth rate of an economy as the sum of changes in labor force participation and productivity. She simplifies this economic measure by likening it to a burger joint's output, dependent on the number of workers and their efficiency. She then discusses the importance of recognizing and fulfilling an economy's potential, drawing a personal anecdote about her mother's different expectations for her and her brother's potential. The speaker advocates for broader conversations on social issues like childcare, public transportation, and economic reskilling to enhance sustainable and inclusive growth.
đ Economics as a Tool for Change
In the final paragraph, the speaker reflects on her initial doubts about pursuing economics due to its perceived detachment from societal issues. However, she now sees economists as agents of change, capable of influencing the world for the better. She mentions various subfields of economics, such as environmental, stratification, and feminist economics, that focus on improving societal conditions. The speaker encourages the audience to embrace challenging subjects, to ask questions, and to seek understanding rather than avoiding complexity. She concludes by expressing confidence in the audience's ability to tackle difficult topics, given their demonstrated comprehension of economics in a short time.
Mindmap
Keywords
đĄEconomics
đĄScarce Resources
đĄSupply and Demand
đĄPotential Growth Rate
đĄProductivity
đĄLabor Force Participation Rate
đĄEconomic Growth
đĄSustainable
đĄInclusive
đĄEnvironmental Economics
đĄFeminist Economics
Highlights
The speaker is an economist challenging the stereotype of the profession, emphasizing its accessibility to everyone.
Economics is often misunderstood as being solely about money, but it's more about the allocation of scarce resources.
The speaker introduces a more relatable definition of economics as the study of what we do with limited supply under given constraints.
Supply and demand is a fundamental economic concept that can be understood without a formal education in economics.
An example of everyday economics is the high prices of rare sneakers due to low supply and high demand.
The speaker's husband, an artist, demonstrates that non-economists also make economic decisions in their daily lives.
Economic decisions can be subtle, like checking prices online before purchasing, or more obvious, like panic buying during a crisis.
The concept of potential growth rate in economics is explained using the analogy of a burger joint's production capacity.
Economists are concerned about the slowing growth rates of economies, which is a departure from historical norms.
The speaker's mother used different expectations of potential to motivate her children, illustrating the concept of potential in a personal context.
The speaker advocates for conversations about societal improvements to increase economic potential, such as affordable childcare and public transportation.
Economists can be agents of change, challenging the flawed systems and advocating for a better world.
There are subfields of economics dedicated to social issues like environmental preservation, income inequality, and gender wage gaps.
The speaker encourages the audience to engage with intimidating subjects and not to be deterred by perceived intellectual superiority.
The talk concludes with a call to action for the audience to embrace difficult topics and to seek understanding rather than avoidance.
The speaker expresses confidence in the audience's ability to learn and understand complex subjects like economics.
Transcripts
[Music]
hi
i'm an economist and this is a talk
about economics
but wait don't turn off don't press the
next button
hear me out look i get it
i know that when the topic of economics
comes up most people
shut off and i'm pretty sure
i'm not what you picture when you think
about a chief economist at a major
financial institution
you know a taylor swift loving
millennial mom to a mischievous toddler
but that's not your fault we're taught
that
economics is a dry complicated and
sometimes heartless field
i'm here to tell you that actually
economics is accessible to each and
every one of us
and if you open up to the field
you might discover something even more
powerful within yourself
let's start with the biggest
misconception about economics
that it's strictly about money
even if you look up the definition of
economics it'll tell you it's about the
production
consumption and transfer of wealth
boring and kind of wrong
a better definition of economics the one
i've always subscribed to
is that it's the study of the allocation
of scarce resources in a given
constraint
okay also a little boring but so much
more
universal basically economics is the
study of
what we do with things that we have in
limited supply
and when we're given rules around how to
use them
sure money is one thing that most of us
don't have an unlimited amount of but
what about the planet or
the scarcest resource of all time
economics studies all of these things
and more
but economics is complicated right
don't you need a phd maybe a beard a
library with leather-bound books
no let me show you
let's break down the most fundamental
concept in economics
supply and demand the idea that when
supply is low
and demand is high prices rise
and vice versa okay you're picturing
your econ 101 textbooks your stomach
is dropping but i bet you understand the
concept of supply and demand
just as well as any professionally
working economist
you know who's not a professionally
working economist
my husband he's pretty much the farthest
thing from it he's a painter
an artist and he's also
a sneaker head now to me a sneaker
is a sneaker but to him the world of
sneakers is a complex web of limited
edition drops and
competition for the most coveted pairs
he'll be the first to tell you that if a
very rare sneaker is released
very little supply but everybody wants
them
lots of demand well those sneakers could
be worth anywhere from
300 to a thousand dollars
but a regular old pair of tennis shoes
available at any mall
tons of supply little demand well those
fifty sixty dollars max
see my husband the artist well
he's also an everyday economist
and so are you you make
complex economic decisions every day
sometimes they're pretty subtle like
have you ever gone to a store
and pulled a product off the shelf and
then thought you know what i'll just
check on amazon to see if it's cheaper
and sometimes large disruptive
forces make those economic choices more
obvious to us
i remember in the depths of the pandemic
seeing people
lined up down the street to purchase
coveted
toilet paper at twice the price
coming out of the stores feeling
victorious
these people understood very little
supply
tons of demand equals very
expensive toilet paper
here's another idea that's central to
economics that
seems complicated but is actually pretty
straightforward
so lately economists have become
concerned that
our economies are slowing you know back
in the 1970s and 80s north american
economies could easily grow at three
four or five percent and those were
considered good numbers
associated with prosperity lately
our economies have been growing at two
percent
or below it seems we've just
lost the ability to grow like we used to
we call an economy's ability to grow its
potential growth rate and economists
measure
it as the change in labor force
participation rate plus the change in
productivity
okay i'm already bored too so you know
what let's just throw out the formulas
and from now on when you think of an
economy i want you to picture
your favorite burger joint yes
and the growth rate of that burger joint
is really simply
how many burgers can it make that's
always going to be a function of two
things
first how many people work behind the
counter
your labor force and second how
fast can each one make a hamburger your
productivity
if you followed this far boom you
understand the concept of an economy
and its potential growth rate and here
comes the fun part
once we know what our potential is the
next step
is to live up to it both as individuals
but also in our economies at large
you know i have this memory of coming
home from school one day with a c minus
on my math test
and my mom taking away my tv privileges
for the day
but then the next day my brother came
home with a c minus on his history test
and
we all went to pizza hut to celebrate i
remember asking my mom what's going on
she said well sweetheart i have
different estimates of your potential
see my mom at the time a stay-at-home
parent though she
easily could have been ceo of a
multinational if she wanted to be
she was also an everyday economist
how do we make sure that our economies
are not just
living up to their potential but growing
their potential over time
well in my mind we need to have some
pretty big conversations about
affordable and accessible child care
public transportation
competitiveness and even reskilling
and retooling our economy towards a more
sustainable
and inclusive future that's our real
economic potential
sustainable inclusive not typically
words associated with the dry dreary
world of economics
i remember being a 17 year old who
questioned
whether economics was the right choice
for me
if i became an economist would i be
complicit
in a system that in many ways is deeply
flawed
i even remember an early economics
teacher telling me economics is a
positive discipline not a normative
discipline
or put differently economics just
studies the way the world
is not how it should be
but i am so happy that 17 year old me
took that leap because now i know
economists can be change makers
and just as all architects don't believe
that all buildings are beautiful or
all artists don't love every piece of
art
not all economists agree that the
economy is as it should be or even agree
on the best ways
to fix it there are entire subfields of
economics devoted to improving the way
the world works
there's environmental economics which
seeks to preserve our planet
stratification economics which studies
income and racial inequalities
feminist economics which looks into
issues like the male female wage gap
see not only is economic something that
we can all
understand there is a place for all of
us
in it so
i haven't been entirely upfront
this is not just a talk about economics
this is a talk about facing subjects
that seem
daunting like economics head
on about not turning off or pressing
next
this is a talk about knowing that no
subject
no field no title has intellectual
superiority
over you next time you come against
something that
feels complicated do like you did today
don't shut off engage if somebody uses a
term
you don't understand bravely ask them to
put it into terms that you do
find people that make intimidating
topics accessible to you
whether it's your neighbor who loves to
talk about accounting or
your uncle the mechanic or bill nye the
science guy
ask questions and don't hold back just
because you think you should know
something that you don't
chances are you'll probably catch on
pretty quick
this is a critical moment in our history
there will be more critical moments
ahead it's going to be hard
but if you can learn economics
in 10 minutes you can do hard
you have all of the tools and now
i hope the confidence that you need
you
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