Decisions Have An Opportunity Cost That Require Tradeoffs

Guns or Yogurt?

by Elaine Schwartz    •    Aug 26, 2012    •    674 Views

It appears that the New York State legislature will soon experience a clash between gun producers and gun control advocates. These quotes sum it all up:

A Remington employee: “In my eyes, Remington goes away, Ilion goes away.”

A gun control advocate: “Look, frankly, if we really want to keep jobs in New York, let’s invest more money in yogurt.”

First the story and then a look at why “guns and yogurt” is a classic opportunity cost dilemma…

Ilion, New York might have been called Remington. Home to 8,000 people, the town’s economy is based on the Remington Arms factory and its children attend Remington Elementary School. Based in Ilion for close to 200 years, this Remington Arms factory employs 1,000 people and, counteracting manufacturing cuts in the area, has added to its work force.

The people in Ilion are worried that Remington Arms will leave if New York State further tightens its restrictive gun laws. They have heard that New York’s Governor Cuomo will make less gun violence a top priority and that proposed legislation could limit firearm purchases to one person/one firearm per month, mandate background checks for ammunition buyers and require microstamping, essentially a ballistics ID for semiautomatic pistols. Responding, a Remington executive said it would “reconsider its commitment to the New York market…” because of the retooling expense (and perhaps because of the unwelcome environment).

Ilion is afraid that Remington will leave. By contrast, referring to Fage and Chobani production in NYS, the Executive Director of New Yorkers Against Gun Violence suggests that the state could attract more yogurt production if the gun makers leave.

This is a classic opportunity cost dilemma. Defined as the sacrificed alternative that a decision creates, the opportunity cost of supporting gun producers is advocating gun control. The citizens of Ilion are saying, “If you support gun ownership, you will increase employment and productivity in our town.” However, the group of citizens that advocates the stricter gun control laws believe they will help society. You can see the tradeoff. Choose one and you sacrifice the other; choosing is refusing.

Sources: I learned about the Remington Arms story in this NY Times article. Here, econlife looks at yogurt production in NYS. And finally, to see the similar tradeoffs for environmental concerns and economic efficiency, you could go here and here.

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