Decisions Have An Opportunity Cost That Require Tradeoffs

Opportunity Cost: Google Doodles

by Elaine Schwartz    •    Jun 16, 2013

How could a Google Doodle cost $268 million?

For the Les Paul Google Doodle (below), the design and construction, bandwidth, server space–all land, labor, capital–could have totaled close to $15,000.

But, let’s add some economic thinking.

A decision also has an opportunity cost. Defined as the next best alternative, the opportunity cost is what we might have done. So, if I have pizza for lunch, the opportunity cost is the turkey sandwich I did not eat. Or, the opportunity cost of washing dishes is the TV I could have watched. Similarly, a farmer growing corn pays the opportunity cost of the extra wheat she could have produced on her land.

For Google Doodles, one blog estimated that the total time people spent playing the Les Paul guitar strings was equal to an opportunity cost of $268,000,000.

Here is the math:

During June 9 and 10, 2011, when the Les Paul Google Doodle was online, visitors remained 26 seconds longer than usual. Assuming that traffic was in the vicinity of 740 million daily visitors, that meant 5,344,444 hours or a total, for 2 days, of 10.7 million hours. Instead, what might everyone have been doing? If they were at work earning $25 an hour, then we could say the cost is $268 million. At work or not, for everyone we can say that the cost was time that might have been spent elsewhere.

Imprecise? Yes.  But still, the reasoning is valuable. Whether we are considering government spending, taking out the garbage, or playing with Google Doodles, the cost includes what we might have been doing. For that reason, cost need not be expressed in dollars. It also can be reading, texting or whatever alternative we sacrificed.

Here Comes the Sun was played on this Les Paul Google Doodle while you can play your own song here. (Yes, today the Google Doodle is for Father’s Day.)

Sources and Resources: Extremetech.com has more (and was my source) on the opportunity cost math for the Les Paul Google Doodle and also for Pac Man while a complete list of Google Doodles is here. Especially charming, the Maurice Sendak Google Doodle is worth the opportunity cost .

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