Friday, January 11, 2013

Helium: a lesson on "shortages", preferences, and rationing

The Independent reports on the latest scare in precious commodities. It seems we are running low on helium. "Low" is a relative and subjective term, of course. We are also running low on gold, beach-front property, private airplanes, and a bunch of other stuff. It's been that way for some time. I guess it is only news when a scientist complains.
"...Now supplies are running so low scientists want to ration it."
Maybe these scientists at Cambridge should head over to the Econ department to see if anybody has ever come up with a good way to ration scarce goods.

I like this quote as well:
"Cheap helium also drives misuse. A staggering 8 per cent of the world's helium supply is currently used for filling party balloons," he said.
I like how only scientists get to define "misuse". What would the buyers and sellers of party balloons say?

But he does seem to understand something about market interference:
"It is difficult to imagine an adequate market incentive to collect helium during natural gas extraction while the US government is selling off its entire stockpile at bargain prices," Dr Stokes said.
Professor Ned Brainard was unavailable for comment.