Scarce and Abundance

First of all, I am not an expert in economic. I just write what I think. It maybe incorrect.

I remembered that I attend the Informatics Entrepreneurship II course, and there was a student asking a teacher about how could the music industry deals with the copyright infringement problem. The music industry was losing money, because people do not buy their CDs. The guest speaker introduces the concept of scarce and abundance. At any given time for something, there are something a little (scarce), and there are something a lot (abundance). For example, for the music industry, the abundance is the music available from the Internet, and the scarce could be the concert ticket.

In my opinion, it is necessary for an entrepreneur to detect what is scarce and abundant. I agree with the guest speaker on the scarce and abundance concept. 

In 1997, there was  an economic crisis in Thailand. Before the crisis, the real estate was bubble. People bought real estate (houses or land) for investment, but they did not buy real estate for living or do something. They hoped that the prices would increase. The prices of real estate were indeed increased. However, after the economic crisis, the prices drop significantly. People do not have money to pay back to the bank. When people can not pay back, the banks took the real estate properties. The abundance would be a lot of cheap real estate. The scarce would be the money. If anyone had bought the cheap real estate properties at that time, they could sell at very high price now, because the real estate business has improved. The situation is similar to the credid crisis occurred in USA recently. If any one has money, they can buy a house cheaply. 

 

 

 

If I remembered correctly, the guest speaker also mentioned about the situation in 2001 for IT companies. A lot of companies laid out software developers. Abundance would be the programmers. If anyone with money, they can start an IT company cheaply by hiring those laid out  programmers cheaply. When the economic is back, they can sell their IT products.