Economic impact of the Toothfairy

27 10 2012

Is the Tooth Fairy a good worker? On the one hand, somehow s/he manages to get around the world in an on-demand capacity, usually with little notice. On the other hand, in our house the Tooth Fairy was always pretty slack. Sometimes it took several nights (and repeated reminders from small children) before the Tooth Fairy finally turned up and did the financial deed. Conversations with friends showed that this was in fact a common experience. Apparently the usual excuse is a workload issue – so many children, unexpected tooth loss, etc. But eventually the tooth would be gone and money would be in its place…although the amount of money seemed to vary from house to house.

One of my sons, when aged about 8, decided to take control of the Tooth Fairy transactions. Having lost a molar, he decided that this was worth more money than your average baby tooth. So he wrote a contract on a scrap of paper and determined what he thought was a fair price – $51. Then, in order to enact the contract, he forged the Tooth Fairy’s signature, and left it out for the Tooth Fairy.

The flaw in the logic, of course, was that the Tooth Fairy would of course recognise that the signature was forged. Perhaps he was counting on s/he being very busy and somewhat distracted. Somewhat like his mother, in fact (although I don’t think I am THAT gullible!). Of course there may have been other flaws in the logic.

Now I would like to stress that the going rate for teeth in my house was nowhere near $51. It was more like $2, although there was some upward financial pressure when a substitute Tooth Fairy left $3 out one night – a precedent was set and could not be backed away from. Inflation had hit the exchange rate.

A friend argues very convincingly that the small decisions like Tooth Fairy rates are the basis of inflation in our economy. The argument goes like this.

If the Tooth Fairy starts leaving out more and more money per tooth, then the value of money to the child is devalued and hence pocket money rates have to rise. Small children with additional spending money hit the shops in a big way and canny retailers realise these children have no sense of the value of money, and hence they raise prices or create new and increasingly more crappy products with large price tags attached. If the prices of lollies, toys etc rise, then other food stuffs and household products rise so that parents think that the child’s purchases are still (in some scheme of things) worthwhile. And hey presto, inflation.

So – no pressure, Tooth Fairy – not only do you have to remember to turn up when teeth are laid out, but you need to make some serious decisions about exchange rates. Our economy depends you.