I am woking on an SAP implementation for a large utility company. I just received a lecture from one of the Indian guys on my team about how the key to growing our economy is the price of beer. Honestly, I’m not just positive he was kidding. I just thought I would add it here for a laugh. It may only be funny with and Indian guy telling it but I am going to give it a shot. He said that the instrument in growing our GDP has nothing to do with interest rates or inflation but the key lies in the price of our beer. If we only decreased the price of beer our demand for products in aggregate would rise. Not only would the demand for beer increase but the demand for Tylenol and other headache pills would follow. Demand of soda and coffee would increase to help these people that are hung over. The demand for taxis would rise as well as the demand for textiles; because drunk people like to break stuff and they also lose stuff. They would have to be replacing their watches, shoes, lamps, mirrors, and anything else in the their dwellings. Waiters and waitresses would be making more money because drunk people always tip more, and when you think of savers those type aren’t the first to come to mind. Consumption in general would rise solely from these waiters and waitresses. Lastly, it would reduce crime! Incredible! People would be at the bars too often and when they weren’t they would be too hung over to rob or steal from someone. I think we now all have to agree that the simple price of beer is what really drives an economy! Not to mention controls crime! If it doesn’t make you at leasts smile, sorry for wasting your time reading this. Maybe I just suck at telling stories. I promise it was funny coming from him though.
The problem with the argument is: a) Demand for beer is not very price elastic b) Beer is a small part of our economy c) The effect of increasing demand for a product on related products drops off exponentially as you move into secondary effects. Thus an increase in the demand for beer would have a negligible impact on watches, etc. Changing the tax rate is a pretty good economy stimulant, though.
Funny but pointless. If you’re a drunk, you’re gonna get drunk, regardless. And if you’re responsible, cheaper beer isn’t gonna make you drink more. Plus, the actual price of a beer is a small part of the $6-$10 you fork over to your bartender. The final, consumer price (at bars) would change little.
Changing the tax rate is a push with decreasing the price of beer. The point of a tax cut is to put money into consumers pockets. You cut the price of beer and one of two things happen: 1) More money in people’s hands because they are spending less on their addiction or 2) There is no monetary effect because people will just start drinking more or getting more hammered than before. All points are agreed on though.
I’d rather have gasoline be less than $2/gallon and pay $10/beer.
Someone I know just went skiing in the canadian rockies and said that they went to go buy beer at the packy (apparently the come in 15 packs, not 12 packs). they threw 2 cases on the counter and it came to over $60 CAD. i didnt ask how much they paid for gas, but something to look into if you’re into paying a lot for beer budfox
“Someone I know just went skiing in the canadian rockies and said that they went to go buy beer at the packy (apparently the come in 15 packs, not 12 packs).” The really good CAD beers come in 28 packs.
There is a massive bootlegging arbitrage spread in terms of beer in Canada and the US right now. I believe I was able to buy 24 or maybe even 36 beer for $20 in upstate New York. In Canada 36 beer would be over $50. Oh the opportunities…
Yes, there are many illegal ways to earn a great profit. However, I would think you can find something with higher margins and comparable risk.