I think Ed has bugged our flat, or that there’s only one good topic of conversation at the moment. Petrol buying.
Last night I called it a “Nash Economics” thing, which sounds better than Ed’s “game theory” label, is certainly more pretenious, and almost definitely wide of the mark. But it reminds me of the theory bit in “A Beautiful Mind”, so as far as I’m concerned, it is “Nash Economics”. Accuracy be damned.
Panic buying can be rationally justified as the following:
- If there’s no more petrol left, I’ll be screwed
- If there’s going to be no more petrol, I need to make sure I have plenty
- There’ll be no more petrol if everyone else panic buys
- Everyone is going to panic buy
- I’d better get some petrol, quick
Of course, if there’s no supply interruptions, 3 doesn’t hold. And you can argue that this whole thing is caused by the media, since they have almost certainly caused 4. But I do find it a beautiful scenario, since every individual acting rationally actually causes the problem they’re all trying to avoid.
Wasn’t it serendipity when the petrol went down the following week and everyone had overspent £xx million by filling up complete tanks worth, that will take weeks to use! During the panic as I was filling up my empty tank in Glasgow, then 3 days later an empty tank in Leeds, it amazed me to see the number of people putting less than £10 or so in their tanks …just in case. (no comments please about my mileage, pollution, global warming, gas guzzler etc etc……..its diesel honest)
OK then, no comments! But yes, when I saw the prices falling I did snigger a little.