[Ensorceled]

Econ 101 explains those counter examples as well: Food has high demand but lots of competition and easy substitution (rice expensive? buy pasta). Housing supply is limited (by location but often artificially via regulation) and substitution is difficult (have to move).

[graphe]

People are not economically rational. Most people don't buy pasta when rice is expensive. Econ 101 explains rational actors in a vaccum, not gluten free, asian culture, anti Italians sentiment, or hatred of Monsanto.

[Ensorceled]

> Most people don't buy pasta when rice is expensive.

They would if rice prices went through the roof, which they won't because people who sell rice are not stupid.

Econ 101 certainly explains why you can actually buy gluten free products now (supply for demand) and why gluten free products are usually more expensive (niche market).

My ECON 101 prof talked about the limitations of models and theories based on assumption of rational actors in the 1980s ... I have no idea why everyone thinks this is a gotcha.

[graphe]

No, they're geniuses because they're subsidized and will always be profitable. They lowered prices by taking it from your taxes.

Throw in subsidies like how Clinton ruined Jamaican rice with protectionism and your supply demand and price are no longer rational. https://www.texasgateway.org/resource/201-protectionism-indi...

Econ 101 ignores subsidies which account for 100% of the big 3 crops and more like rice, and ignores any form of economics.

[Ensorceled]

I don’t know where you took Econ 101 but mine definitely covered how things like subsidies and protectionism perversely impact market forces. You’re just blaming economists for bad policies at this point.

[imp0cat]

Well, some might, you can get pasta that looks exactly like rice (orzo).

[drekk]

How many recessions has "Econ 101" predicted? Economics is a "soft science", on the same tier as psychology which people love to ridicule. Understanding how rational actors behave in a microeconomic sense doesn't help you when you're talking about irrational actors in the macroeconomic sense

[Ensorceled]

The basics of Supply and Demand, Price Elasticity, Inflation, Monopolies, etc. etc. don't require humans to be perfectly rational actors to be useful concepts.

Yes, Economics can't predict recessions or the next Beanie Baby fad, that doesn't mean supply and demand is nonsense.