Adam Smith Rule

The demand and supply in a market is driven by an invisible hand, so said Adam Smith a couple of hundred years ago. So we should let the market to rationalize demand and supply. In this respect, we can also generate some information from market price about demand and supply. One good example of this kind is from a recent annuncement of CUCSSA, about its annual National Day Grand Party. Here is the ticket pricing information: $3.00: CUID; $4.00: Student ID, spouse of CUID (one spouse per CUID!), seniors older than 55; $5.00: Female non-student ID holder; $10:00: Male non-student ID holder with female partner; $20.00: Single male non-student ID holder. Assume the ticket price equals the real price minus CUCSSA subsidy. From the pricing policy, we can generate the following conclusions: 1. A female CU student is less likely to meet Mr.Right in the party. Because the high subsidy to encourage CU male students to bring in their wives and non-CU males to bring thier female partners ($10 reduction). Also single non-CU male won't show up simply because of the high price . 2. A male CU student is likely to meet Ms. Right in the party. Given that married male students have to pay extra $4.00 to bring in their wives, they are less likely to attend at all. Also the price for external single competitors is really high ($17), so those externals are less likely to participate. There is almost no price difference between female CU students and non-CU female single ($2), the non-CU females will be willing to come. See you can learn a lot about the CUCSSA 2005-2006 Working Committee from the above information: it is dominately male CU students!