Friday, 30 September 2011

Bun deal

Today I spent £1.39 on four burger buns that I knew, before I handed over my money, that I would have to throw away. I knew this because as I handed them to the lady in the shop she looked a little concerned, she checked the date, and she said 'they look ok, but if they're not suitable then bring them back and we'll give you a refund'.

I know what milk smells like when it's gone off, even despite being nowhere near it's expiry date. It smells like milk.. and as soon as I smell the milk, I have to throw it out because it's 'gone'. So I never smell the milk. I put it in my tea, and it's ok. If someone says 'I think the milk might be off' then I smell it, and it is off.

So the burger buns were, obviously, off. I smelt them and they smelt funny. I sliced them in half and the texture wasn't right. I threw them away. I was never going to take them back to the shop.. I wasn't even ever going to tell the lady that I'd rather not buy them in the first place. Sometimes, I'm so dreadfully British it really rather hurts, Henry.

So here is my question... did I help the economy at all?

Well, I think I added to GDP, which is good. It was a small local shop, not a supermarket, so that's good too. I'm fairly well off, and can afford to save money, so it's good that I spent some.

But, of course, nothing has been achieved here.. except a redistribution of my £1.39 between a variety of people... some probably poorer than me (the girl in the shop) and some probably richer (the managing director of the company that made the buns). There's no VAT on burger buns, but the taxman still grabs a cut of everyone's profits and wages - so some of my money will go to help ensure that very wealthy pensioners can continue to draw state benefits.

But, like I say.. have we really achieved anything?

Have we, in fact, caused harm? The bun maker made and/or the shop sold buns which were possibly not fit for consumption. After all, the lady didn't express concern or assure me I'd be OK for a refund with anything else I bought. There was clearly poison in them there buns... and I paid for them, and even if there had been rotting kitten feet inside I'd probably have decided that, for £1.39, it wasn't worth the bother of returning them. What kind of message does it send to all these people that I'm OK just to hand over £1.39 of the wage I should have been hard-earning at the time I'd ducked out to buy burger buns.. (or, 'working from home' as it's often known.) without getting anything like commensurate value? Have I been had? Or am I at fault for not helping them improve by pointing out that flogging me shonky buns just isn't on?

No value has been created, yet everyone has been rewarded.. except me, and I'm entirely ambivalent. Yet, to most the people who add things up and cast their opinions.. there was good here. There was production, distribution and retail of something. There was a free market exchange. There's been tax collected and wealth redistributed. Many boxes were ticked, and I had my burgers in a sandwich instead.

1 comment:

  1. Well, to decide on the value you have to compare it to what might have happened instead. In practical terms, your transaction was just equivalent to giving the shop £1.39. Assuming disposal costs are about equal, it makes no difference who threw them away, you or the shop. So in that case, you neither helped nor harmed the economy, you did something economically neutral; they gained £1.39, you lost £1.39, it's the same neutrality as giving money for a birthday or something.

    Where you may have harmed the economy is that if you hadn't taken the buns, somebody else may have bought the buns, and used them instead of some other (fresh) buns, thus saving the production of the fresh buns which could have gone to some other productive activity (in practical terms, more fresh buns to sell to a third party).

    This is really a probabilistic thing; you'd have to work out the chance of somebody actually using the buns and then divide the £1.39 by that, I think. If in 1 in 10 cases, somebody would buy and use the buns, and in the other 9 cases they'd just get thrown away by the shop, you might have cost the economy about 13.9p. But now my head is spinning, and I'll stop with the bad arithmetic.