Football Economics: The Moving Frontier Change and the PPF

1. The Production Possibilities Frontier examines a simple economy or a simple personal choice where only two options are available. The shape of the frontier is a visual demonstration of the trade-off between the two options. It might be pruning hooks versus spears or TD’s versus A’s, but in each case the line tells us something about capacity and opportunity cost. The actual production of the economy (or athlete) in relation to the frontier tells us if the economy (or athlete) is efficient. The way the frontier shifts tells us something about technology, costs and other factors that change opportunity costs and/or productive capacity. Football Economics:The Moving FrontierChange and the PPF

2. Football Economics:The Moving Frontier PPF: Why the curved shape with increasing opportunity costs? Product Y Product X

3. Gold Medals Football Economics:The Moving Frontier Olympic Athletes or Football Players Entertaining NFL Teams

4. Points A, B, and C tell us something different about what’s going on in a society: A: This combination of hooks and spears is possible but some resources are not at work. This is an inefficient place for society because more of either or both are possible at this point. B: This combination is efficient because no resources are idle. C: This combination is not possible in society. However, it might be temporarily obtained due to heavy government borrowing, monetary inflation or other special circumstances. Pruning Hooks Football Economics:The Moving Frontier The PPF, Efficiency and Potential in Society C B A Spears

5. Points A, B, and C tell us something different about the athlete: A: This combination of A’s and TD’s is possible but he is idle or misdirected too often. This is an inefficient place for the athlete because more of either or both are possible at this point. If his coach realize it, he’ll be running wind sprints. B: This combination is efficient because he is reaching his potential. Whether or not it’s the ‘right’ combination, is a different question that his coach and his family will care deeply about. C: This combination is not possible through legal and ethical means. A’s per semester Football Economics:The Moving Frontier The PPF, Efficiency and Potential in a College Athlete C B A Touchdowns per semester

6. Gold Medals Let’s assume something dramatic happens in society and the overall number of athletes in a society is substantially reduced, perhaps a large war or perhaps a change in parental preferences toward raising musicians rather than athletes. In this case, the PPF shifts to the left, or reduces. This makes point A an efficient point while points B and C are now unattainable. In the general economy, a reduction in the PPF might be caused by a large-scale crop failure, an intense outbreak of crime, or an increase in the number of federally required vacation days. Football Economics:The Moving Frontier A reduction in the PPF C B A Entertaining NFL Teams

7. Gold Medals Let’s assume something dramatic happens in society and the overall number of athletes in a society is substantially increased, perhaps a minority group that used to have limited access to training and competition now gains the necessary access. In this case, the PPF shifts to the right, or increases. This makes point C an efficient point while points B and A are now inefficient. Productivity growth through technological improvements would have a similar impact in the general economy. Football Economics:The Moving Frontier An increase in the PPF C B A Entertaining NFL Teams

8. Pruning Hooks Finally, consider a technological advance or any resource or productivity improvement that only impacts one of the two items. If we are better at making spears due to a more efficient spear factory, we will be able to have more spears while still maintaining most, if not all, of our hook production. In this case, the PPF shifts to the right, or increases. This makes point C an efficient point while points B and A are now inefficient. Football Economics:The Moving Frontier An improvement in producing one good. C B A Spears