Sunday, June 26, 2011

Examples of Transaction Costs and Inefficiency in Pop Music

I was driving to conference session and was listening some music in my car.  When Runaround by Blues Traveler came on. It occurred to me that the lyrics dealt with an efficient exchange.  The fact that the parties were not trying to minimize the transaction costs, i.e. they were erecting impediments that kept them from reaching an agreement. 

As I thought further, I thought of two more songs (both considerably older) that also dealt with the same issue to some extent.Those were Hello, Goodbye by The Beatles and Let’s Call the Whole Thing Off by George and Ira Gershwin. In both cases, the inability or unwillingness to communicate (transaction costs) is causing a failure of consensus and efficient “exchange.”  None of the songs are perfect, but they may be helpful in setting up the discussion or topping off discussion.  What are your thoughts? Will this work? Does it work?  I know I’m going to try it. I'm also interested if you can think of more recent examples or songs from different genres.

1 comment:

Mr. Janka said...

I love the analysis. See this post: for alook at econ concepts in Fountains of Wayne songs. (Admittedly, some of the are a stretch.)