Supplementary resources for high school students
Definitions and Basics
A producer is someone who creates and supplies goods or services. Producers combine labor and capital—called factor inputs—to create—that is, to output—something else. Business firms are the main examples of producers and are usually what economists have in mind when talking about producers. However, governments are producers of some kinds of services—such as police services, defense, public schools, and mail delivery—and sometimes goods, such as when a government owns the oil fields and oil production (for example, OPEC). Households and individuals are producers of non-market goods and services such as cleaning, child-rearing, cooked food, etc. Entrepreneurs, by contrast, are idea-creators. They often also start off their ideas as producers.
- 1: one that produces especially : one that grows agricultural products or manufactures crude materials into articles of use
- 2: a person who supervises or finances a work (such as a staged or recorded performance) for exhibition or dissemination to the public
A person who creates economic value, or produces goods and services.
Entrepreneurship. Concise Encyclopedia of Economics.
An entrepreneur is someone who organizes, manages, and assumes the risks of a business or enterprise. An entrepreneur is an agent of change. Entrepreneurship is the process of discovering new ways of combining resources. When the market value generated by this new combination of resources is greater than the market value these resources can generate elsewhere individually or in some other combination, the entrepreneur makes a profit. An entrepreneur who takes the resources necessary to produce a pair of jeans that can be sold for thirty dollars and instead turns them into a denim backpack that sells for fifty dollars will earn a profit by increasing the value those resources create.
In the News and Examples
Brendan O’Donohoe on Potato Chips and Salty Snacks. EconTalk podcast episode, August 2011.
Brendan O’Donohoe of Frito-Lay talks with EconTalk host Russ Roberts about how potato chips and other salty snacks get made, distributed, and marketed. The interview follows an hour-long tour of a local supermarket where O’Donohoe showed Roberts some of the ways that chips and snacks get displayed and marketed in a modern supermarket. The conversation is a window into a world that few of us experience or are even aware of–how modern producers and retailers make sure the shelves are stocked and their products get noticed….
Lisa Turner on Organic Farming. EconTalk podcast episode, December 2012.
Lisa Turner of Laughing Stock Farm talks with EconTalk host Russ Roberts about life as a small organic farmer. She describes her working day, the challenges of farming, the role of the U.S. Department of Agriculture in her life and what some job applicants who want to work on her farm need to understand about business….
Chris Anderson on Makers and Manufacturing. EconTalk podcast episode, December 2012.
Chris Anderson, author of Makers: The New Industrial Revolution, talks with EconTalk host Russ Roberts about his new book–the story of how technology is transforming the manufacturing business. Anderson argues that the plummeting prices of 3D printers and other tabletop design and manufacturing tools allows for individuals to enter manufacturing and for manufacturing to become customized in a way that was unimaginable until recently. Anderson explores how social networking interacts with this technology to create a new world of crowd-sourced design and production….
Elizabeth Pape on Manufacturing and Selling Women’s Clothing and Elizabeth Suzann. EconTalk podcast episode, April 2017.
Elizabeth Pape, founder of the women’s clothing company Elizabeth Suzann, talks with EconTalk host Russ Roberts about starting and running her company–a manufacturer and seller of high-end women’s clothing in Nashville, Tennessee. The conversation chronicles the ups and downs of her entrepreneurial story, the recent evolution of the women’s clothing market, and the challenge of competition from lower quality, lower-priced products….
Advertising, from the Concise Encyclopedia of Economics
Economic analysis of advertising dates to the thirties and forties, when critics attacked it as a monopolistic and wasteful practice. Defenders soon emerged who argued that advertising promotes competition and lowers the cost of providing information to consumers and distributing goods. Today, most economists side with the defenders most of the time….
Wages and Working Conditions, from the Concise Encyclopedia of Economics
CEOs of multinational corporations, exotic dancers, and children with lemonade stands have at least one thing in common. They all expect a return for their effort. Most workers get that return in a subtle and ever-changing combination of money wages and working conditions. This article describes how they changed for the typical U.S. worker during the twentieth century….
Labor Unions, from the Concise Encyclopedia of Economics
For more than a century now, labor unions have been celebrated in folk songs and popular myth as fearless champions of the downtrodden working man, while “the bosses” are depicted as coldhearted exploiters of employees. But from the standpoint of economists—including many who are avowedly pro-union—unions are simply cartels that raise wages above competitive levels by capturing monopolies over who companies can hire and what they must pay….
Interest, from the Concise Encyclopedia of Economics
Interest is the price people pay to have resources now rather than later. Resources, of course, can be anything from college tuition to a big-screen TV. Interest is conventionally expressed as a percentage rate for a period of one year. If borrowers (those who want resources now) can obtain the resources from lenders (those who are willing to surrender current control) on the condition that they return 103 percent of the resources one year later, then the interest rate is 3 percent….
A Little History: Primary Sources and References
The Distribution of Wealth, by John Bates Clark
[This is the original book that worked out the economics of wages and returns to capital (economic rents) as presented in classrooms today—the marginal products of labor and capital. Difficulty level: very advanced.]