…I’d buy a gas station and teach economics.

The two are intertwined, though. I don’t think running a gas station would be that fun, and I don’t know that I’d enjoy teaching economics either. But the two together could be interesting.

Gas, for example, strikes me as quite inelastic. Even when gas prices were around $3.50 out here, we bought it. I didn’t reduce how much I drove. And with gas prices still very high, I ended up taking a small hit in gas mileage when I ended up buying an SUV.

Economics is generally a boring subject. But what if you let your economics students run the gas station?

For example, what would happen if we one day, out of the blue, decided to charge $8 a gallon for gasoline at our station? Would anyone come? What would be their reasoning if they came? And then suppose, a few months later, we decided to go a little crazy and charge $1.00 a gallon, but not market it any way other than updating our signs. How quickly would the word spread? When would we have a line? Would we see an appreciable sale in other items (e.g., would sales of food and drinks inside rise?) Would absolute mayhem break loose? And could we then construct a demand curve for gasoline? And we could even note that it wasn’t as ‘perfect’ as the textbooks show it. What if we gave gasoline away for free one day?

Having successfully covered price elasticity of demand, we could move onto competition. What would happen if we opened up in view of another gas station, and always updated our price to be one-tenth of a cent less than the guys across the street? Would they catch on and update their pricing? Would we spur a price war? Who would win?

And then, what if we later (after letting things adjust) decided to charge the exact same price as the guy across the street. Would he undercut us, or would he keep his prices the same? (Some of this could get into more complex game theory stuff that I never fully grasped.)

We could also cover complementary goods by looking at trends in, say, how many bottles of oil and windshield-washer fluid we sell.

I know I’m a business geek, but tell me that doing all of this–without worrying about profit–wouldn’t be fun.