Days in Karachi have been a little cruel lately. Domestic protests have restricted urban life and protests on the internet are taking a toll on our cyber-selves. It makes me wonder, why would rational beings be forced to take decisions, which, at least in foreseeable future, and in all likelihood, are deemed to harm them? Why do people spend money and bear a cost by bycotting and banning stuff they previously liked? What really is the economics of protests?
One answer I got yet: protesting is like buying insurance. People protest against laws, actions, events and other people because they want to hedge their odds. For example, promulgation of a particular law will cause long term loss to a community, which subsequently protests against it by incurring short term cost, or in insurance jargon, paying premium. Protesting also entails the same costs - moral hazard and adverse selection.
If protesting is really like insurance, are we sitting on a huge business proposition? Could "protest firms" be the next big thing? Would one be able to buy a 'protest option/coverage' in exchange of a premium?
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