If economists ruled the world, there would be no more hangovers. As the 5pm kick-off for Friday night drinks approaches, consider how a rational economist would act.
Let’s call him Joe.
Joe walks into the pub alone (he seems to spend a lot of time alone, our Joe) and takes up a vacant stool at the bar. Looking furtively at a nearby group of revellers, Joe orders a beer. Slowly and thoughtfully, he consumes his first schooner and then orders a second. After half an hour he has finished both drinks.
A hassled-looking barman shuffles over and asks if he would like another. By this time our economist is feeling a little tipsy (he doesn’t drink that often, you see). He falls silent and starts weighing his options, under the watchful eye of an increasingly impatient barman.
”I would quite like another drink,” Joe muses to himself, ”because it makes me feel good and is a pleasurable experience. But what would be the consequences of consuming another beer?
”No doubt, I would feel hungover tomorrow. Not only would I feel sick but it would undermine my ability to accurately catalogue my stamp collection, which I have been meaning to do for ages. And, by choosing to stay here at the bar rather than go home, I would also forgo the pleasure of playing that new Playstation I have just bought and have been itching to play all week.”
Our young economists slips off his stool, shakes his head at the barman and heads for the exit, unnoticed by the nearby crowd who are now laughing raucously.