This is not a “Star Wars vs Star Trek” post. I'm non-partisan. I enjoy both Star Wars and Star Trek about equally. And it turns out that I am not alone. Last December, John Hawkins (University of Canberra) wrote in The Conversation about what Star Wars can teach us about economics. This year, Hawkins (with Tesfaye Gebremedhin, also University of Canberra) wrote in The Conversation about what Star Trek can teach us about economics.
One of the best ways to teach economics is to start with stories people already know. And people know Star Wars and Star Trek. Hawkins' articles provide many interesting examples of the economic principles, concepts, and models that appear in each universe. For example:
Indeed, the star wars started from an interplanetary trade dispute. Interplanetary trade seems based on the resources each planet has in abundance, which may be some minerals or cheap labour...
There is a lesson here, both about the gains from trade and the risks of starting trade wars...
And:
A prime example is Quark, the archetypal Ferengi who owns a popular bar and restaurant. Quark exploits his monopsony power – being the sole employer in a niche market – to underpay staff and impose harsh working conditions...
But in one episode, Quark’s employees go on strike, prompting him to use underhanded tactics to suppress collective bargaining and maintain control.
This storyline mirrors real-world labour market dynamics and the tension between capital and labour.
The two articles are limited by word count, but there are many more examples that Hawkins (and Gebremedhin) could have used, including examples of the same economic principle, concept, or model appearing in both universes. For example, there are lots of examples of supply and demand dynamics, including the spice trade in Star Wars (with wartime disruption decreasing supply and increasing the price, incentivising smuggling) and Star Trek (with conflict and station politics in Deep Space Nine changing the prices of scarce commodities, which the Ferengi benefit from). Or consider the externalities from the destruction of Alderaan in Star Wars, or the Borg incursion in Star Trek. Or public goods, such as planetary defence against the Empire in Star Wars, or shared defence in the Federation in Star Trek. Or many, many examples of game theory (such as the examples in the book Hidden Games, which I reviewed here).
Science fiction may be fictional, but there is still much that we can gain from these universes in terms of illustrating economics in action. These universes are basically case studies in economics, incentives, and institutions.
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