If you didn’t know, I’m a bit insane, as I’m taking two classes at the local college this summer, one of which is the beloved economics, macroeconomics to be more specific. We’ve been talking about the concept of a free lunch, and here’s my take on the topic:
Two weeks ago was my birthday. Around that time, I usually receive free meals or drinks to various places. One I received was to the restaurant Perkins: one free breakfast meal. Upon opening the email from them, I thought to myself, “Yes! A free breakfast!” My thought, however, was misguided. You see, nothing in life is ever really free, unless you’re talking about abstract concepts, such as love, which is a discussion for another day.
Contrary to what their name implies, a free breakfast from Perkins or a free lunch elsewhere isn’t actually free. While it may be free to you or me, somebody else had to pay the price. You’ll often find this is true of everything. According to Campbell R. McConnell’s book “Economics: Principles, Problems, and Policies,”* someone or something will always have to pay the price, whether it’s land cost, labor cost, capital cost or entrepreneurial cost.
Let’s talk about this free breakfast concept a bit more and the actual costs associated with it. To be specific, the free breakfast from Perkins consists of two fresh eggs, two meats, either bacon or sausage, and a stack of buttermilk pancakes. First, let’s examine whether there were any land costs. By land cost, we don’t just mean physical land, but also the minerals and plants of the land. And food, as many of us know, often comes from plants in the ground. For this meal, the flour for baking the pancakes and many of the other ingredients in them were land costs.
The labor cost for the meal is higher than the land cost. A server had to take the diner’s meal, walk all the way to the kitchen to tell the chefs it, who then had to physically cook the meal with meat from a pig that somebody had to slaughter. Then, the server had to bring the meal back out. Furthermore, the diner had to eat the food somehow, obviously it wouldn’t just fly into their mouth, so the work it took for them to lift their fork to their mouth was another labor cost.
What about capital cost? This type of cost, as you may know, is the cost of the equipment used in the production of the meal. I’m sure the stovetop of an oven was used, as well as a fridge for preventing the eggs from formerly spoiling.
And lastly, there was an entrepreneurial cost. Some perky guy or gal (get my pun??) had to go out on a limb and start the restaurant Perkins. In the beginning, they didn’t know whether or not it would be successful, but they took that risk.
In conclusion, we can see that this assumedly ‘free’ breakfast isn’t actually free.
As established previously, the recipient of the free breakfast didn’t have to pay any physical cost out of his or her pocket, but he did pay some other costs and so did many other people. The land cost, labor cost, capital cost, as well as entrepreneurial cost were there. And since these resources are limited, our economy as a whole footed the bill of that free meal.
Throughout life, you will realize that everything has a cost. While some things might not necessarily cost every one of the four mentioned areas, it’s going to cost at least one of them. Some costs are low and some are higher. But if the benefit that results is higher than the cost, many will say it’s worth it. And let me tell you, sacrificing my energy to lift that fork full of scrumptious goodness to my mouth was, without a doubt, worth it.
*McConnell, B. F. (2015). Economics: Principles, Problems, and Policies. McGraw-Hill Education.
What’s your opinion? Can you think of any exceptions to the premise that there is no such thing as a free lunch? I’d love to have a discussion about it with you below!
Now . . . how was that as food for thought? (sorry, I had to) 😀