Harold Hotelling: 2 ideas worth knowing

2 ideas from Harold Hotelling, each explained in a minute and credited to the original work. Free on Savvy.

Two ice-cream carts on the same beach always end up side by side
Harold Hotelling showed in 1929 that rivals fighting for market share tend to minimise the differences between them rather than maximise them. His model of two vendors on a straigh…
— Harold Hotelling, Stability in Competition
An economist showed why you don't dig up all the oil at once, even with no regulation
In 1931, Harold Hotelling asked why owners of a finite resource like oil or minerals don't just extract it all immediately and invest the cash. His answer: in an efficient market, …
— Harold Hotelling, The Economics of Exhaustible Resources

Five ideas worth knowing, every week