The Economics Of Profiting From A Royal Baby Announcement

September 10, 2014 in Daily Bulletin

The Duchess of Cambridge is pregnant again and it’s an opportunity like no other for brands to expand their market share writes the BBC:

  • Within minutes of the announcement of the pregnancy Nissan released the ad pictured above.
  • It’s unlikely that Nissan and other companies spontaneously created this in response to the announcement. Instead they’d probably planned for the event in advance and had ads ready to go.
  • Nissan’s probably shows seven seats just in case something like twins, triplets, or quadruplets had been announced.
  • The Postal Service, for its part, noted that a ‘special delivery’ was on the way.
  • Pizza Express suggested that the couple name their child pizza.
  • And Lexus used the announcement of what could potentially be a baby brother to push the younger sibling of one of its own models.

See examples of brands trying to cash in on the announcement, find out why they do it, and more over here.

Source: BBC

The Ball That Could Transform The NFL

September 8, 2014 in Daily Bulletin

For all the technology being used in this year’s NFL season, the process used to determine the position of the ball hasn’t changed since 1907 writes Joseph Stromberg. This could change:

  • Most other sports use high resolution cameras to track the location of the ball. This isn’t an option at the NFL where the ball is often blocked by players’ bodies.
  • Now researchers are experimenting with using radio waves to track the ball. This system is superior to GPS or NFC because it’ll be able to track its position even in the case of a 22 man pile up.
  • Aficionados might be concerned that the transmitter will affect the balance of the ball, but given that each ball is handmade anyway, there is considerable variation, and the extra weight from the transmitter will be within the bounds of the natural variation.
  • The technology could also be used to help coaches track data such as a quarterback’s throwing speed for each pass.

Read about the technology, see how it’s put into a ball, hurdles to adoption, and more over here.

Source: Vox

Would You Want To Live In A Beer Ad?

September 6, 2014 in Daily Bulletin

Julie Turkewitz wrote about one town that has the opportunity to live in a beer ad. They’re not very thrilled about it:

  • The makers of Bud Light are turning a small town into a beer ad by flying in 1,000 youngsters and making free beer available to them for a weekend.
  • The main road of the town in Colorado has also been set up with outdoor hot tubs, concert stages, and sand pits.
  • The 1,000 participants were selected through a contest where people submitted videos proving that they were “up for whatever”.
  • A $500,000 donation was made to the city in return for being allowed to run the publicity stunt – big bucks for a town with an annual budget of just $10 million.
  • The area will be rebranded as “Whatever, U.S.A.” for the duration of the stunt.
  • Residents dislike the idea, fearing that it will ruin the tranquil spirit of the vacation town.
  • Defenders point out that the initiative will bring tourists, employ locals, and boost sales for local bars and restaurants.

Read more here, and find out why the deal was conducted in secret, what the donation will be used for, and what local residents have to say.

Source: The New York Times

Chinese Incentives To Encourage Interracial Marriages

September 5, 2014 in Daily Bulletin

Jamil Anderlini wrote about China’s efforts to advance the “great cause of assimilation” and “ethnic unity” in the country:

  • Minority ethnic groups who marry somebody from the dominant Han ethnic majority, will be eligible for an annual bonus of ¥10,000 (US$1,600) for up to five years.
  • The policy is targeted at ethnic Uighurs who are predominantly Muslim, from the western region of Xinjiang.
  • Those involved in interracial marriages will also be eligible for up to ¥20,000 in medical expenses, and ¥5,000 towards any resulting child’s education.
  • Such policies have been tried with some success in Tibet where 8% of Tibetans are in interracial marriages. The corresponding proportion for Uighurs is just 1%.
  • The incentives are particularly appealing in a region where the average annual rural income is just ¥7,900.

Read about the incentives, other ways that China is trying to solidify its rule over the Uighurs, and more over here.

Source: Foreign Policy

Via: Marginal Revolution

The History Of Cotton Candy

September 4, 2014 in Daily Bulletin

Zachary Crockett wrote about cotton candy:

  • The desert can be traced back to Italy in the 15th century when sugar syrup was used to create delicate strands of candy.
  • Due to the labour intensive process, as well as the high price of sugar, the “webs of gold and silver” were a treat to be enjoyed by the very rich.
  • Oddly enough, it was a dentist in 1897 who invented a machine that allowed for the treat’s mass production. It was called “fairy floss”.
  • The machine was debuted at the World’s Fair and despite the high cost per serving, it was a hit. The inventor dentist and his partner earned close to half a million in today’s dollars at the fair.
  • We owe another dentist in 1921 for coming up with the term “cotton candy”.
  • These days manufacturers of the machines like to note that since the ingredients are so cheap – all that is needed is a small amount of sugar, air, flavouring, and dye – each serving is almost pure profit.

Read about the history of cotton candy, why Australians still prefer to call it fairy floss, and more over here.

Source: Priceonomics

Shoes That Guide You

September 3, 2014 in Daily Bulletin

Annie Banerji wrote about a startup that’s manufacturing shoes which automatically guide you:

  • The shoes link to the wearer’s smartphone and guide them on their intended route, using the phone’s map app. If they should turn then the shoe will vibrate letting them know which way to go.
  • The shoes also monitor number of steps taken, distance travelled, and calories burned.
  • The forgetful will appreciate that it vibrates anytime their phone is too far away – indicating that the user has left it behind.
  • The shoes will cost around $125.

Read about the shoes, find out why they’re called “LeChal”, what the fashion conscious can do if they’d prefer to match the shoes with their outfits, and more over here.

Source: Phys.org

Via: Marginal Revolution

Bizarre Insurance Policies Available In China

September 2, 2014 in Daily Bulletin

China’s insurance market has struggled to grow, despite low rates of market penetration. Insurers have resorted to offering quirky insurance policies to drum up interest write Clare Baldwin and Diana Chan:

  • Naughty child insurance helps parents to cover damages from children throwing tantrums. It costs 44 yuan a month and covers for up to 100,000 yuan of damages.
  • Brides to be can get insurance against becoming pregnant before their honeymoon, getting divorced, and can even purchase a financial instrument that rewards them for remaining married.
  • During the recent World Cup ardent fans could purchase insurance for over-drinking, being attacked by outraged fans, and their favourite team losing.
  • Fans of the popular hotpot can get insurance against burning their mouth.
  • Travelers can get insurance against smog ruining their vacations.
  • And during the moon festival it was possible to purchase protection against clouds covering the moon.

Read about the different types of insurance, how much they cost, why the authorities have taken a dim view of the practice, and more over here.

Source: Reuters

Via: Marginal Revolution

How The Shale Gas Boom Changed The Lives Of Farmers In India

September 1, 2014 in Daily Bulletin

John Samuel Raja D. noted that the surge in America’s production of fracked gas bought great riches to farmers 21,000 km away:

  • Guar gum is a key ingredient used in the process of fracking due to its binding, thickening and emulsifying qualities.
  • It comes from a crop call guar. India is the world’s largest producer of it.
  • As the shale gas boom progressed India’s exports of guar-gum shot up from $20.2 million to $3.5 billion in less than 10 years.
  • The price of guar increased tenfold to $500 per 100kg.
  • Farmers took the bounty to pay off their debts, build homes, and arrange lavish weddings.
  • Since then frackers have found synthetic alternatives and prices have dropped to around $100 per 100kg.

Read about why the prices dropped, the future outlook for the farmers, and more over here.

Source: Quartz

The Economics Of Superstition

August 31, 2014 in Daily Bulletin

The Economist took a look at how superstitions affect investment returns:

  • The Chinese word for “eight” is similar to the word for “prosperity”, and the word for “four” is similar to the word for “death”. The superstitious favour the former, and avoid the latter number.
  • Local investors in Taiwan are 50% more likely to pick a trade ending in 8 than in 4.
  • The most superstitious had returns that were 0.03% lower than the least superstitious – this coincidentally comes out to an annual loss of 8.8%.
  • There are other superstitions and even cognitive biases that traders fall to, such as the preference for round numbers.
  • Algorithmic traders can take advantage of such predictable behaviours to extract profits.
  • Evidence indicates that overtime, as traders get more experienced, they lose their superstitions.

Read the rest of the article to find out more details here.

Source: The Economist

The Economics Of Kidnapping

August 30, 2014 in Daily Bulletin

Derek Kravitz and Colm O’Molloy took a look at the murky world of hostage negotiations:

  • “Kidnap and Ransom” (K&R) insurance has become a booming industry as companies increasingly insure their executives in conflict ridden areas.
  • A periodic premium is paid, and if a kidnapping happens, the ransom is paid by the insurer.
  • Total premiums have risen from $50 million ten years ago to at least $250 million today.
  • The average ransom paid is around $3.75 million. Premiums can be as high as $1,500 per employee, per day.
  • Exact numbers are difficult to find as those ransomed typically sign non-disclosure agreements in an attempt to prevent other groups from being encouraged to try kidnappings.
  • The practice is controversial. According to one estimate Al-Qaeda and other groups have made more than $125 million through ransom payments to fund their operations.
  • Yet the practice continues to grow – big news pieces about piracy, terrorist, and other risks has pushed companies to purchase more of the policies.
  • Kidnappings used to mostly be associated with Latin America. But kidnappings in the Middle East have grown from 4% of the world total to 17% in the last decade.

Read about the business, the “kidnap reports” that organizations can buy, the details of one K&R insurer, and more over here.

Source: The Guardian