Question

In economics it is necessary to see the costs or benefits of any unintended
consequences surfacing from policy decisions.
Plata is a little town north of the Concove Caves in Korea. It has a shop; a supermarket,
which supports the large and remote area around the town. Curiously, more than half the products
in the supermarket are sweets, chocolates, sweet drinks (SSB) and pallets of large packs of sugar

Plata is about 1 hour and 35 mins drive from Halcua in China. Why might this fact influence
the quantity of sugary products in Plata's supermarket? Is this an example of an unintended
consequence? Discuss.

Answer 1

Unintended consequences are outcomes of an action which were not necessarily intended or foreseen.

Plata is 1 hour and 35 mins drive from Halcua in China. Thus the benefits of having sugary products are that there is no shortage of sweet products, but the costs are that there are limited number of non-sweet items which the consumers can consume. Thus Plata must be getting access to majority of sweet products from China as it might be procuring its goods and services from any nearby areas from which it can procure goods from. Halcua in China might be specialising more in sugar products and less in other savoury products, wherein it might be proving effective for the supermarket in Korea to gain access to products which are in greater quantity and cheap.

Thus, this is an example of an unintended consequence as more number of people will buy sugar products because they are in abundance, this might directly lead to higher level of health concerns relating to diabetes, or other blood sugar related concerns which might pose risk on the health of the population.

Because of the easy access to sugar products, the supermarket is able to sell those goods to the population which is not the actual intent of a super market chain as it has to have an assembly of products in equal quantity and a wide variety of range in its portfolio.