I’d love your help with a new routine I’m working on called “When life gives you lemons…” The idea is to use this popular phrase to explain different branches of economics, in the same way that a different popular phrase was used in my not-safe-for-work “S*** Happens” video.
For an example, consider the difference between getting an MBA and going to econ grad school:
- MBA: When life gives you lemons, go corner the market for lemons.
- Econ grad school: When life gives you lemons, go read “The Market for Lemons”.
- Undergraduate microeconomics: Consider a world with only two goods: lemons and “everything else”. Show how life giving you lemons shifts your budget constraint and allows you to reach a higher indifference curve. (What assumption are we making about lemons?)
- Undergraduate macroeconomics: When life gives you lemons, show the impacts using an IS-LM model. Bonus points for clever terminology that allows you to call it an “IS-LMn” model.
- Graduate school macroeconomics: When life gives you lemons, show the impact on interest rates in a Lucas tree model. (Carroll  writes that “Lucas  considers an economy populated by a large number of identical individual consumers in which the only assets are a set of identical infinitely-lived trees. Aggregate output equals the fruit of the trees, and cannot be stored.”)
- Natural resource economics: When life gives you lemons, do the same maximization problem as the graduate-school macroeconomists, but then mock them because they’re supposed to be learning deep lessons about macroeconomics and as far as you can tell you’re all just studying lemons.
- Environmental economics: When life gives you lemons, examine the resulting positive and/or negative externalities. Estimate the optimal rate for a Pigovian tax or subsidy.
- Development economics: When life gives you lemons, find 50 similar villages in Kenya and randomly divide them into two groups. Give lemons to one group, wait 6 months, them write a paper for JDE.
- Behavioral economics: When life gives you lemons, explain why you might value them less than if you’d had to work for those lemons. (But: What about the endowment effect?)
- Game theory: Consider a game where p is the probability of nature giving you lemons. Find the Bayesian Nash equilibrium.
- Economic history: Use the theory of innovation and diffusion to explain why, despite the lemon experiments of James Lind and others going back to the 1740s, the citrus cure for scurvy was “repeatedly rediscovered and forgotten into the early 20th century.”
Additional suggestions are welcome in the comments… excellent entries will be incorporated into my comedy routine and rewarded with signed copies of my Cartoon Economics books!
PS. Inspiration came from the song “Lemonade” by Fly Moon Royalty (here’s the more time-wasting music video), which includes the line “When live gives you lemons, you can go and build a lemonade stand.” Additional inspiration comes from this article (“When Life Hands You Lemons, Race Them”) about the 24 Hours of LeMons race, and various Lemonade Stand games I confess I haven’t played, including this and this.