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- [Tyler] This is a pretty [br]tragic topic,

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and in some ways, [br]it's tough to talk about,

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but let's give it a try.

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Let's keep in mind[br]that in the modern world,

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there still really is [br]a lot of slavery

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and many people are [br]rightfully outraged by this.

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But the question is [br]what to do about it?

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So in the 1990s, there were [br]humanitarian reformers,

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and they went to Sudan, [br]and their plan was

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to buy slaves and set them free.

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Now that sounds great.[br]

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What could be better[br]than setting free slaves?

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That sounds pretty noble,

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but did it actually help[br]stamp out slavery,

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or did paying slaveholders [br]to release these slaves

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lead to more people being captured?

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Let's use the economic concept

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of the elasticity of supply [br]to help understand this better.

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The problem is this, [br]the people trying to free the slaves --[br]

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we'll call them the slave redeemers --

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they're also creating[br]additional demand for slaves.

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After all, they're buying slaves [br]in the market.

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That additional demand shifts [br]out the demand curve for slaves,

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and it leads to a new[br]and higher market price.

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That higher price will bring [br]forth additional supply.

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So what are the people who [br]round up and kidnap the slaves --

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what are they going to do?

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Well, they're going [br]to increase their operations.

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They're going to have more raids,

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and they're going to take [br]more people into slavery.

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We can already see there's [br]at least a possibility that buying

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the slaves and setting them free [br]will be counterproductive

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because we haven't managed [br]to stamp out all of slavery.

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What we've done is set [br]some people free

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but actually give those kidnappers, [br]those people in the middle --

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we've increased their incentives [br]to bring more people into slavery.

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And therein lies the potential[br]for an even greater tragedy.

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The concept of elasticity [br]in economic terms -- that refers

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to how responsive is quantity [br]supplied when market price changes.

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It's going to help us understand [br]how much a slave redemption program

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will increase the number of people

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who end up captured [br]by slave raiders.

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Inelastic supply means that even [br]a much higher price

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doesn't result in a much [br]larger quantity supplied.

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In that case, even if the price [br]of slaves went up by a lot,

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not that many additional[br]people would be captured.

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That's the better case scenario.

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It also means the price [br]of slaves will go up and stay high

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because the off-setting [br]supply response is weak,

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and it's not pushing [br]that market price back down again.

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Again, that's [br]the better case scenario.

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It means that in the long run, [br]the redeemers are doing more

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to limit slavery [br]than to encourage it.

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But, however, let's say [br]the supply curve is more elastic --

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that means a flatter curve,[br]and it means the quantity supplied

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to the market will increase a lot [br]with the higher price.

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In that case, it's easier to find[br]more people to enslave.

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Then as a result [br]of the boost in demand

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from the humanitarian redeemers,[br]a lot more people will

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end up captured and enslaved.

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And then, the total number [br]of people captured as slaves

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is going up quite a bit.

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And you have to wonder [br]in that case are

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these slave redemption programs [br]really a good idea?

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So what's the answer?

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It's genuinely hard to say [br]whether the supply of slaves

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is elastic or inelastic, [br]but we can look at price

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as a possible indicator of which [br]scenario is more likely to hold.

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We know that in the early years [br]of slave redemption,

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there was a noticeable increase[br]in the price of slaves,

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and that could be evidenced [br]of a fairly inelastic supply curve.

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However, over time, [br]the price of slaves has fallen,

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and that could indicate greater [br]elasticity of supply in the longer run.

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That makes sense, [br]but the suppliers are usually

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more responsive [br]to an increase in price

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as they have more time to adjust.

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For instance, they can [br]hire more people

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and expand their operations.

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So this evidence overall suggests [br]that perhaps the program has

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become less effective over time,[br]and perhaps today, it may actually

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be counterproductive and be [br]increasing the burden of slavery.

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In other words, good intentions [br]aren't always enough.

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If someone comes along and puts [br]an apparently good idea on the table,

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we still need to think through[br]its unintended consequences.

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- [Narrator] If you want to test [br]yourself, click "Practice questions."

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Or, if you're ready to move on, [br]just click "Next Video."

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