November 23, 2017

Economics on toast – the price of avocados

Share Button

I enjoy eating avocados; they are high in good fats and supposedly great for my health. I noticed recently, however, that the price of avocados in my local supermarket has substantially increased.

It appears that I am not the only one enjoying avocados; there has been a huge surge in demand for the fruit.

While the United States is still the largest consumer, demand has increased all around the world, including China. In April 2017, the world’s first avocado-only restaurant opened in Brooklyn!

At the same time, heatwaves and droughts in California, flooding in Peru, and a growers’ strike in Mexico have all combined to reduce the supply of avocados.

The combination of increased demand and reduced supply is a classic lesson in economics. The impact of the curves shifting can be seen in the diagram.

Here’s hoping supply is increased soon!

2223 Total Views 1 Views Today
Gerry Reilly, Senior Teaching Fellow About Gerry Reilly, Senior Teaching Fellow

Senior Teaching Fellow, delivers the on-campus Economics seminars and is part of the Strategic Planning teaching team.