The movie “My Cousin Vinny” has a fan club of lawyers and judges who love to quote the movie and use it as an example of effective cross-examination. As the daughter of a trial lawyer, it’s no surprise that my family watched the movie over and over again. It remains one of my favorite movies.
While it is popular among lawyers, I have yet to hear anyone use it to discuss economics. I’m here today to change that for you.
If you haven’t seen it, here is the brief summary: Vinny is a New York lawyer who has never tried a case before. He’s representing his cousin in a murder case down in the South.
One of the many great scenes of the movie is when Vinny and his girlfriend go in for breakfast at the local diner. There are three things on the menu: Breakfast, Lunch, and Dinner. When their breakfast arrives, it is grits, eggs, and bacon. Vinny and his girlfriend (played by Marisa Tomei--she won an Oscar for her performance in this movie) are from New York and have never heard of grits. Not surprisingly, they are very nervous about trying them….
Grits then come up at a critical juncture of the trial. Vinny accuses the witness of making instant grits because they only take a few minutes to make. The quick reply from the witness is “No self-respectin’ Southerner uses instant grits. I take pride in my grits.” Everyone on the jury nodes their head in agreement.
So, what does this have to do with economics?
It relates to perfect substitutes. A concept I introduce in this post here.
Perfect substitutes—as the name suggests—are two items that you can substitute for each other, and you don’t care which you get. For example, two small pieces of select-a-size paper towels equal one large piece of paper towel. You can perfectly substitute between them.
The interesting part about perfect substitutes relates to the decision on which you should consume. To answer that question, we need use of what is very scientifically called “bang for buck.” You want to consume whichever gives you a greater bang for your buck.
“Bang for Buck”
“Bang” = the additional benefit you get from consuming one more unit of something
“Buck” = the cost of consuming that next unit
For perfect substitutes, the relative bang between goods should not change as you consume more of one versus the other (you don’t get sick of having two smaller paper towels versus one large paper towel), and the price doesn’t change. So, you’ll end up consuming all of one or all of the other of a good.
Let’s get back to grits. Regular grits and instant grits. First – are they perfect substitutes? Yes, they are just different forms of the same thing.
Which one tastes better? Well, I’m going to bet you can find that most poeple think regular grits taste better than instant grits. What does that mean about the relative “bang” (or in more economic terms, marginal utility)? Regular grits are going to have a greater “bang” than instant grits.
Bang of Regular Grits > Bang of Instant Grits
So, should you just consume all regular grits? Not necessarily…
Let’s turn to the “buck,” or the cost of grits. There are two costs that you could talk about – the cost to buy OR the cost in terms of the preparation time. We’ll talk about the latter: The time it takes to make regular versus instant grits.
If, since starting to read this post, you have gone off to watch “My Cousin Vinny,” you’ll know that regular grits take at least 15 to 20 minutes to make. Meanwhile, instant grits take less than five minutes.
For simplicity, let’s say that it takes 15 minutes to make regular grits and 5 minutes to make instant grits. That means that it takes 3x as much time to make regular grits as it does to make instant grits. The “buck” is 3x as much for regular grits.
Which one should you make, the regular grits or the instant grits? That depends on YOUR preferences.
If you get 4x as much enjoyment from eating regular grits as instant grits, then you should eat regular grits (remember the time cost is 3x as much for regular).
If you get only 2x as much enjoyment from regular grits, then you should just have the instant grits (the benefit is 2x as much for regular grits, but the time cost is 3x).
You go which whatever good gives you a greater bang for buck! With a time cost for regular grits being three times as much as the cost of instant grits, it better give you more than three times as much benefit if you choose to consume regular grits. If you choose to consume instant grits, it is because regular grits give you less than three times as much benefit.
For Mr. Tippton (the witness in the movie), he clearly gets more benefit versus the time cost of making regular grits versus instant grits.
There is one caveat. You have to have the capacity (or time) to make regular grits. If you only have 5 minutes (or really, anything less than 15 minutes), then you only have one option: instant grits.
Now…do me a favor: go watch the movie and think about the bang for buck of grits…
Grits:
To make grits, you just boil water with some salt. Then add grits and stir for 15 to 20 minutes until they are done. I don't find regular grits to have a lot of flavor. I recommend that after cooking you adding some cheese and cream. Not surprisingly when you've done that, they are delicious!