Claire surprises Phil by purchasing the magic shop of his dreams. The previous owner sold it for very cheap, but then Claire starts to wonder if the magician had information she was unaware of. Despite the concern, this is a unique opportunity for Phil to become an entrepreneur.
See more: asymmetric information, competition, entrepreneurism, free entry
Jay has a great new invention that he believes will revolutionize the closet industry. It’s a sock dispenser. In competitive industries, product differentiation can lead to short term profits – especially for early adopters. Why is Jay concerned that his son, Manny, has a new friend who has seen this idea?
See more: competition, entrepreneurism, innovation, monopolistic competition, trade names
Cam and Mitch are trying to get Lily into the best preschool they can, and preschool admissions are normally very competitive, but they think that being gay and having a minority child will give them a leg up in the admissions process. The market for daycare appears to be a monopolistically competitive environment in which firms differentiate their offerings to appeal to different parents.
See more: allocation, competition, demand, inefficiency, monopolistic competition, prices, product differentiation, rationing, signaling
Claire tried to make friends with the owner of Closets, Closets, Closets, Closets (CCCC) but Jay convinced her that the friendship was just a ruse to steal information about the business. In retaliation, Claire and Jay decide to “poach” CCCC’s most valuable employee, Lazlo. While trying to recruit him to their closet business, they learn that the friendship was genuine. But now, they really can’t trust each other and both businesses will be hurt.
See more: competition, cooperation, duopoly, game theory, labor, oligopoly, preferences, Prisoner’s dilemma, tit-for-tat strategy
Economics often suggests that competition improves efficiency. Jay seems to agree. He fosters competition within his family to help them achieve their goals. But are they really achieving those goals? Later in the episode, we find out that there were some unintended consequences of his actions.
See more: competition, extrinsic rewards, incentives, intrinsic rewards, labor, motivation, perverse incentives, unintended consequences
Economics often suggests that competition improves efficiency. Jay seems to agree. He fosters competition within his family to help them achieve their goals. But are they really achieving those goals? The truth comes out in this clip. It turns out that they’re a family of cheaters and not a family of winners.
See more: cheating, competition, ethics, incentives, moral hazard, motivation, self interest, unintended consequences