The Economy in Vietnam and the United States from the Perspective of an Immigrant
When I was in Vietnam:
I was born and raised in a suburban area of Vietnam. As a citizen of a developing country, I learned and witnessed many things in Vietnam's economy that clearly mirror some concepts of economic class. The story is about the ice factory:
I remember there were only two ice factories in my area (around a radius of 20 miles). To earn more and control the market, those companies formed a cartel. In that summer time, during those first several months, customers had to pay a large amount of money to get ice from them since they were monopolies in my small market. Due to the heat, demand remained high at that time, they earned a lot of money by forming a cartel. The event lasted for two months until I saw a conflict between those two factories when both sides fought each other (it was normal in Vietnam). I and my mom were there watching them and found out that one of the factories was cheating by offering wholesale buyers (from restaurants) a better price so they can attract wholesale people to earn more without letting the other company know. After taking this class, I can tell that they broke the agreement when in cartel form
(Source: Internet)
When I move to the United States:
a. The egg market:
I have been going to the gym for eight years, so I care a lot about my protein intake. There was an event back in mid-January when it rained for weeks. Consequently, it affects the egg industry, and the event cut down a big amount of egg supply. The price doubled from $15 to $30 for 60 eggs. The egg market is a competitive market where there are many sellers selling identical products, and they are also price takers. When the supply decreases, the supply curve shifts backward which causes an increment in price and a reduction in quantity with the unchanged demand curve.
b. Pfizer vaccine:
I’m also playing stock. Pfizer is one of my favorite stocks back in the pandemic time when I have to stay at home and wanted to make some side hustle income. The vaccine industry in the pandemic is a typical monopoly or oligopoly in the short run and a competitive market in long run.
First of all, before covid time, the world was racing for vaccines so we could resume to new normal life. Pfizer was a big winner during that time. Its stock went from $26 dollars to $60 dollars in one year and a half (2020 to mid-2021), which shows how much the world cared about vaccines at that time. After being announced that Pfizer’s covid vaccine is approved by FDA, its product price skyrocketed, and the government had to intervene to support the people to afford the vaccine. At that time, Pfizer was a monopoly, and it can control the price as it wanted. It turned out that the amount of vaccine produced didn’t match its huge demand. Below is the graph to demonstrate the market power of Pfizer at that time:
Secondly, after prevailing in the market for weeks, companies finished launching their products and entered the market. The vaccine market started to become a competitive market. Due to the increase in supply, its curve shifts forward. Since companies are price takers when the market is competitive. Vaccine prices have been decreasing since better technology, and supply is more and easier. Luckily, by being affected by the competitive market model, the vaccine is now more affordable to peoples without government support (it also take a lower toll on health insurance). Below is my presentation about the event:
Vo Nguyen #69838249
Econ 2023