Friday 14 December 2012

Yes, demand curves do slope downwards

even for milk.

In a PR piece on the free milk in schools trial in Northland Fonterra writes
Research conducted by the University of Auckland has shown that children’s milk consumption in the Northland community, both at school and at home, has significantly increased since the pilot began.
So if you make the price of something zero people consume more of it! Who would have guessed?
"We are totally committed to Fonterra Milk for Schools because we believe it will make a lasting difference to the health of New Zealand’s children. We want Kiwis to grow up drinking milk because it’s good for them and we are proud that this programme will give every primary school kid the chance to enjoy this nutritious product,” he said.
Or if you get the kids drinking milk now and they keep on doing it you have, with a bit of luck, created a market for milk in the future. What firm wouldn't want this?

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