Wednesday, August 6, 2008

How to strike it rich in the love market

In honour of the first ever "The Economics of Sex and Love" course that will be taught at Dalhousie University this year, I would like to draw your attention to Lessons in Love, by Way of Economics . Needless to say, like the enrolment number of this Dalhousie class reflects, economists have been very successful at finding ways to popularize our discipline - let's call it: "Freakonomizing". Yes, that's a verb not a noun.

In this NY Times article, Ben Stein's proposes 8 lessons to mastering your return in the love market. I find some of his economics confusing, so I have cut and pasted a few gems and provided a bit of my own interpretation below for my dear readers.

1.) Stein's number #1 rule seems to be: Success in the love market takes smart investing and a long-term view. There are three Stein Love-vestment tips: (a) The returns in love situations are roughly proportional to the amount of time and devotion invested. If you invest caring, patience and unselfishness, you'll get those things back if the person loves you too(and if you don't ...): (b)Once you find that you are in a junk relationship, sell immediately. High-quality bonds consistently yield more return than junk, and so it is with high-quality love;(c)Research pays off. Diversification in love is impossible, so it’s necessary to do a lot of research on the choice you make. Get and give exclusive licensing rights to maximize returns.

2.) The returns on your investment should at least equal the cost of the investment and keep your expectations rational. If you are getting less back than you put in over a considerable period of time, sell-sell-sell. But remember, it is a long-run game. Stein says: The impatient day player will fare poorly without inside information or market-controlling power. He or she will have a few good days but years of agony in the world of love. To coin a phrase: Fall in love in haste, repent at leisure. (Stein's phrase - I will take no credit for that).

As we all know, the love market is a complex beast. I agree with Stein's recommendations to invest conservatively (say no to junk), do your research, take a long-term view, but because we have to put all our eggs in one basket (to make a real run at it), it means that we run the risk of losing it all if we take the plunge. While there is a market for those who believe you can buy happiness , nothing superficial and shallow lasts.

Did this post make you think of David Lee Roth too?

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