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Yeah. So when I talk about, you know, why do firms choose not to raise the price just to to clear the market, what
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the economists say is the kind of the the optimal thing to do. I mean, sometimes it doesn't make sense to do it
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because of what you're selling. So, uh, you know, if it's admission to an elite
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college or university like, uh, you know, Wharton or University of Pennsylvania, we don't just raise
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tuition until we fill a class with the people willing to pay the most because that's not the point of the institution.
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The the experience of being here is, you know, we want to admit only the best and
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brightest and have them get to interact with each other and and kind of we think
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our teaching will be most effective for that group. But we are very selective in
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that market for kind of picking the the group that is right for us. And that same thing is true on the labor market
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which is another of these hidden markets where you don't just lower your offered
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salary until you get one person apply. You you uh have to kind of work through the applicants that you get and kind of
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pick the right one. But some of the firms when they do this strategy, it's not just about kind of finding the right
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people. It it might be about bolstering future demand, right? Maybe the restaurant likes the line around the
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block because then it builds demand for the next night when people walk by and like, "Oh my god, how do I get into that
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restaurant? It looks so good." >> Right. And so I think this is true of a
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lot of like uh fad crazes. So this summer it was Laboos. I don't know if you came across this, but
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>> I heard. >> Yeah. So, you know, they're they're these like little stuffed animals and
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they remind me of Beanie Babies or when I was a kid, Cabbage Patch dolls where like everybody wants one this summer and
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they're impossible to get. And that's, you know, it's not I don't think it's
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just that they have trouble producing them. I think they want there to be a mania around them so that people will
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get excited by uh by buying it and and that, you know, creates these hidden markets that might not otherwise exist.
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So, how common then are hidden markets? And are they more common than maybe we think that that they're out there?
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>> They're definitely more common than than we think. So, when I started kind of
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talking about hidden markets and and thinking about all the ways that they crop up. I mean, I I was writing a book
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on it and I was also surprised how often that they they pop up and they pop up in
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these uh environments that are particularly important. Thank you for listening to The Ripple Effect. We hope
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