Market Analysis: Revising Major Term Papers

Economic Naturalist 3.21 asks why major term papers go through so many more revisions today than in the 1970's. Using a supply and demand framework as a way to look at the question, the explanation is straightforward. This is an example of how economic models are so very useful. This approach does not so much tell us what the thought processes are for individuals in markets as it provides us with a structure within which we can make sense of an otherwise confusing world.

Exploration: The simple supply and demand model can help us to establish a reference for human behavior. In this case, why have the number of revisions of major term papers risen over the past thirty years?

The window above contains a simple supply and demand model. Equilibrium in the market is determined by the place where no one wants to change their behavior; suppliers are not willing to bring more or less than buyers are willing to buy, and buyers are not willing to buy and more or less than suppliers are willing to sell. Since the demand curve is a representation of the quantity buyers are willing to buy at each and every price, and the supply curve is a representation of the amount sellers are willing to sell at each and every price, the equilibrium occurs at their intersection. To use this graph, click and drag either the S or D left or right to decrease or increase supply or demand. Then click on the New Equilibrium button to see how the price and quantity will change. If you wish to make an additional change, click on the Update button to "lock in" the current equilibrium before shifting S or D again. To set the graph back to the original starting position, click the Reset button.

1. Using this interactive model, shift the supply curve to the right (as in Figure 3.16 in your text). To shift the curve, simply drag it to the new location. Once the curve is in place, click on the New Equilibrium button and observe the changes. What is the effect on the quantity of revisions?
   
   
2. What is the effect on the price of revisions?
   
   
3. How would the number of revisions be affected if, in the absence of improved technology, professors began to require more carefully written papers?
   
   
4. How is this different from the first case with respect to the "price" of doing a revision?
   
   
5. Does this outcome make sense?
   
   
6. What if both things happen simultaneously? What if the ease of completing revisions rose as professors began to require more carefully written papers? How would these simultaneous changes affect both quantity and price of revisions?
   
   

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Exercise picked up from the 2e Microeconomics textbook.