Originally Posted by Dwyer View Post
This is a pure myth of our capitalist society.QUOTE]In the social science of economics, there are a finite number of people chasing a finite number of products at a given time and a finite number of dollars that exist.
Yes, but unless the company were getting every one of those dollars to begin with, the proper way to look at the issue is the net effect of an action, not the response of a single customer.
Originally Posted by Dwyer
If I choose not to pay $10.00 for a product, that company will never get my $10.00. Never ever.
But if from the publicity of your one-person boycott, the company is able to get $20 from two customers who would not otherwise have bought the product, in the end it’s up $10. As I said, I think this happened with the Passion of the Christ. Early attacks and boycott talks, mostly from Jewish groups, gave the film an unprecedented amount of free publicity, which wasn’t really in the budget for the small studio.
If you really read, analyzed, and thought about what I am saying, then you would understand the economic truth of what I wrote.
Again, Movie Studio never receives my $10.00.
Never.
Even if someone buys 20 tickets, they never receive my particular $10.00.
Here’s a hypothetical example:
Suppose you live on the island of Rikki Tikki.
You own a hammer store.
Rikki Tikiki only has a population of 12. 10 people are consumers, you own a hammer store, and your neighbor Gus owns a hammer store.
But all 10 consumers buy at your store, because Gus’s service is slow.
You sell 7 hammers at $10.00 each to seven consumers; but then you’re rude to the last three and they refuse to buy at your store, and go to Gus’s across the street, even if Gus takes longer.
Your Total sales: $70.00, Pretty good, huh???
But if you hadn’t been rude to the last 3, you would have had:
Total Sales:
$100.00; That’s $30.00 better.
Now, say 3 Tourists from the mainland enter your shop and each buy a hammer. That’s another $30.00 in the till, so you have a total of $100.00.
But the fact remains that because you were rude, you still would have had $130.00 if you had been polite.
No matter, if you sing, dance, stand on your head, you’re never going to get that same $30.00; not in a million years.
$30.00 represents the
opportunity cost, or earnings forgone because the owner decided to act rude.
See, Economists insists on going behind the dollar transactions to measure the
true resource costs of an activity.
Business Accounts generally exclude non-monetary transactions, such as the costs of boycotts to their businesses.
What I have given is an example of an
opportunity cost, the difference between money transactions and
true economic costs.
The
opportunity cost denotes the opportunities forgone, or the costs incurred, by taking that action rather than the best alternative decision.
Now, this Movie Theater could have made a similar and equally entertaining movie that could have grossed, say, $700,000,000.
But because the film offended Christians specifically and other religions in general , those consumers boycotted it and that cost them money, say $200,000,0000 in box office sales.
And the bad movie reviews cost them another $150,000,000.
That brings them down to $350,000,000.
But the Movie Studio could have made $700,000,000.
So the
opportunity cost for making an offensive movie was
$350,000,000.
I realize this is a hypothetical analysis, but my point is that
you cannot say Boycotts have no effect or absolutely no effect on businesses providing goods and services.
That is what the media and businesses want you to think and believe in our society and tell you to think that and repeat it over and over, ** but it is absolutely not true**.