Determinants of Price Elasticity of Demand 125 Elasticity is a general measure of the responsive ness of one thing relative to another. The concept of elasticity is more than an intellectual device to ‘examine strictly economic data, however. It has many practical applications, including, among oth- ers, providing a means of classifying relationships. Friendship can be interpreted from an eco- nomic perspective. A “good friend is someone who has a low price elasticity of demand for your com- panionship. In other worul, the person in question desires your company pretty much independently «nfavhat it costs him or het. You can raise the price” of your trigndship to a friend by behaving badly being late for dates. being loud and obnoxious. grinding your teeth, not keeping your word. ving, andso on. But your friend will not desert you at the higher “price."'The demand for your friendship is inelastic: consumption of your friendship does not change much when its price rises, Other people will not pass the fr last will desert you. Perhaps there are larger numbers Of substitutes for your friendship available. Fe 5.6 illustrates this phenomenon. The “price of friendship” on the vertical axis is what it costs an individual 10 be your friend—Are you Demand Curves for Friendship Good iriends express tlemand curves of relatively lesser elasticity fr vour friendship. Ponce fiends show more: of demand lstcity & easy to get along with? Are you fun? Are you a good conversationalist? Are you trustworthy? Higher or rising prices mean that being your friend becomes more costly in terms of your behavior. The quantity of friendship on the hori- zontal axis may be thought of as the amount of time you spend with a friend. The two demand curves in Figure 5,6 illustrate two types of behav- ior. The steeper demand curve D, is relatively less clastic than Dy, (NF = no friend), Demand curve ‘Dy; represents the behavior of someone who is a “true friend.” At high prices or low. that person has « tainly constant desire to be around you Demand curve Dy¢ proxies a “fickle friend.” Ata slightly higher price (suppose you get sick), the demand tor your company is radically reduced. Friendship isan inelastie demand curve for you: a relatively higher elasticity of demand implies a weaker concern Think of your own personal rek inships. Do this—missed phone calls, only call when they need. something, always insisting on doing what they want to do? And what about your good friends? Need we say more? Indeed, is not “love” a rela- tively inelastic demand curve? Ove Quentiy of friendship ee