Why Is Caviar So Expensive? 🪺

Morning Sturgeon!

Do it.

Do the thing.

Hahaha.

Caviar.

The eggs of a sturgeon fish.

Also the world’s most expensive food. But why??

So basically caviar wasn’t always so valuable.

In the 19th century, these eggs were so abundant that saloons offered caviar for free like peanuts:

At the same time, Europeans are feeding caviar to their pigs to fatten em up:

Now, just a little problem springs up.

It’s the industrial revolution.

And all these new industrial revolution factories were just dumping their waste into rivers.

Pollution was out of control.

Plus dams were built in rivers so these sturgeon couldn’t swim upstream and reproduce.

The sturgeon population tanked!

And when something’s in limited supply, the people who are willing to pay the most for it, set the price.

That’s economics 101.

Here’s the caviar-saloon time graphed out:

Here’s how you read one of these supply & demand curves:

You’ve got a f*ck ton of supply. That’s that heaping mound of sturgeons on the yellow supply line.

Read straight down from there.

That’s how much demand you’ve got for all those sturgeons.

Not much. There’s just too godd*mn many.

Now avert your gaze along the dotted line toward the left to find the corresponding price of this caviar.

Boom. That’s the price of our abundant saloon caviar.

Like $1.

Okay, now that you basically have a PhD in microeconomics, here’s a perfect equilibrium in the caviar market:

Perfect harmony.

Supply = Demand.

Now here’s what happens because of the industrial-revolution-dying-sturgeon-supply:

There’s too much demand for the little supply going around.

So people are willing to pay A LOT for the scarce caviar.

Caviar producers notice this and begin marketing their product as a luxury good.

So now this little jar will cost you $4,000…

Stay Cute,

Henry & Dylan 🌈

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