Economically speaking, would Bill Gates pick up a dollar on the street?

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pohnpei397's profile pic

pohnpei397 | College Teacher | (Level 3) Distinguished Educator

Posted on

Speaking strictly from an economic point of view, it would probably not make sense for Bill Gates to take the time to pick up a dollar.

The reasoning behind this is tied to the idea of opportunity cost.  If Gates stops to pick up the dollar, he has used X number of seconds of his time.  He will now not be able to use this time to do something else.

Given how much money Bill Gates makes, it is likely that he could have done something with those seconds that would have been worth more than $1. In that case, the opportunity cost of picking up the dollar would be higher than the value of the dollar.

So, if we assume that Gates could have done something that would have made more money, he shouldn't pick up the dollar.

krishna-agrawala's profile pic

krishna-agrawala | College Teacher | (Level 3) Valedictorian

Posted on

Economics does not deal with behavior of individuals . It neither takes into consideration either their exact wealth nor their personal thinking, likes and dislikes. Thus in economics it would be meaningless to ask if Bill Gates would pick up a dollar on the street. It would be better to ask a question like "What factors would affect the decision of a person to pick up a dollar o the street". In response to this question we can think of several factors. These include:

  • What the person intends to do with that dollar.
  • How much satisfaction the person will derive from making use of the dollar in the intended way. This is important because the buying goods for personal consumption is not the only use of the money. Some people may find great pleasure in finding the person who has dropped the dollar there and restoring the dollar to that person.
  • What is the cost in terms of effort and time required to pickup the dollar. Again if a person is in a hurry the cost of time may be high, but if the person is relaxing on a bench with the dollar just within arms reach, this cost will be very low.

Not talking about economics, it is quite improbable that a very rich person like bill gates will stoop down to pick up for personal use a dollar spotted lying on the street. However I will not be surprised if the same person may not only pick up that dollar, but also make some additional efforts to find its owner in restore the dollar to him.

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