Jay is shocked that Manny won’t eat pickles, so he won’t let him leave the table until he tried one. Gloria thinks Jay is being a hypocrite and forces him to try blood sausage. Then Jay decides Gloria need to try something new too: scratching the dog, Stella’s, belly. While they all seem to hate what they try at the time, we see Gloria petting Stella’s belly voluntarily and Manny surreptitiously eating a pickle at the end of the episode. This highlights the need for full information in order to know your true preferences.
See more: behavioral, full information, preferences, tastes and preferences, utility
Cam’s dad, Merle, is fighting with Cam’s mom and they are considering a divorce. After seeing Jay with Gloria, Merle thinks he might be able to do better, but Gloria paints a bleak picture of his future. Does Merle really have better options waiting out there or would he maximize his expected utility by staying with his current wife?
See more: cost benefit analysis, expectations, opportunity cost, tradeoffs, utility
Claire is proud of how she almost scared a man to death last Halloween, but Phil points out that it was overkill and she could have been scarier with less makeup.
See more: decreasing returns, diminishing marginal returns, government regulation, marginal utility, negative externalities, negative returns, role of government, utility
Phil and Luke are trying to go on as many rides as they can at Disneyland, but after a while Phil can’t take it anymore. It’s clear that Phil’s utility is diminishing at a much higher rate than Luke’s.
See more: decreasing returns, diminishing marginal returns, marginal utility, negative returns, utility, utility maximization
It’s Halloween. Jay and Gloria usually coordinate their costumes. Use this scenario to setup a payoff matrix for picking costumes. Gloria and Jay are the players. What choices would you like to give Gloria? What choices would you like to give Jay? What are the payoffs for each possible outcome? What’s the most likely outcome given your matrix? There isn’t a single correct answer. Just have fun with it and discuss.
See more: choices, game theory, interdependent utility functions, payoff matrix, preferences, utility
Alex is graduating from high school soon so Phil, Claire and the kids are visiting Cal Tech. Claire thinks Cal Tech is the perfect place for Alex but she’ll find out soon that she and Alex have different preferences. College is one of the ways that we build human capital. As we learn more things, we become more productive and our labor is more valuable. Alex is already really bright and loves academics so college is a good fit to set her up for doing impressive things in the future.
Claire wants a great school that’s close. Alex wants a great school that’s far away. We also learn that Cal Tech has 5 Nobel Laureates on staff, suggesting that Cal Tech itself has a lot of human capital, making it a highly productive college.
Alex learns why Cal Tech might be a better choice for her than an East Coast school. What is more important: the quality of the program or proximity to home? Choices are tough and everything has a cost. Here’s Alex’s current dilemma: stay close to home and attend the best program in the country OR go to a college on the east coast with a weaker program.
See more: cost benefit analysis, human capital, opportunity cost, preferences, school choice, signaling, skill building, tradeoffs, utility
Jay got new glasses that make him look like an old man but they work really well. So well that he realizes that Gloria’s family members in Columbia are wearing his old clothes. Notice that Gloria says that they sometimes send the clothes back. In the US, people frequently donate clothing to people in less developed countries. Many economists argue that this is counterproductive and leads to a surplus of clothing in these countries. That surplus can hurt markets and cost jobs.
See more: charity, donations, efficiency, emerging markets, gift giving, growth, interdependent utility functions, preferences, utility
Claire is feeling under the weather but has too much to do. Phil offers to help her out with her errands and pick up some slack until she feels better. One of the gains of partnerships is that if one person goes down, the other can pick up the slack.
See more: gains from trade, gains to marriage, risk pooling, risk sharing, utility
Cameron fills in as the drummer in Dylan’s band, and after their first song, performs an impromptu drum solo. Mitchell originally found him impressive, but his drum solo went on so long that he experienced diminishing marginal returns.
See more: diminishing marginal returns, utility
Mitchell complains to Jay about Cam being too nice, and Jay complains to Mitchell about Gloria not liking his dog butler. Jay notes that they are both with people who are very different and that maybe that makes their relationships better.
See more: assortative mating, gains from trade, gains to marriage, matching, preferences, utility
Jay bought a bog butler in a casino gift shop and thinks that everyone loves it, but Gloria detests it and tries to get rid of it. Every time she comes home, she’s reminded of the dog and it ends up scaring her. While Jay loves it, he’s perhaps not taking into account the cost it has on others in the family.
See more: externalities, negative externalities, preferences, utility
Mitch and Cam have a house guest who made breakfast using the expensive caviar that they had been saving for a special occasion. While enjoying their wonderful meal, they realize that there are all sorts of things that they have never used because they were waiting for the perfect time. This demonstrates choice paralysis. Cam and Mitch have seemingly endless choices for when to consume these special things but they never actually do. Choice paralysis says that we have a difficult time making a choice when there are too many options. As a result, we cannot chose and end up with a sub-par outcome.
See more: choice paralysis, choices, framing, preferences, utility, utility maximization
Gloria is sick and Cam tries to help around the house. Gloria’s family remedy for colds is a bit smelly and Cam accidentally uses Joe’s cape. Gloria points out that Joe has a strict ranking set when it comes to that cape and he even places the cape above his own father.
See more: preferences, ranking, subjective value, transitivity, utility
Cam and Mitch have been married 3 months, but it seems like their honeymoon will never end. Cam continues to give Mitchell flowers even though he clearly doesn’t enjoy them as much as he used to. He may have loved the first bouquet, but eventually he may start to hate them.
See more: diminishing marginal returns, gift giving, inefficiency, preferences, rationality, utility