Demand is a curve, not a constant!

I'll have more to post on the offshore aquaculture summit I'm at later. But for now, I'll just comment on an economic fallacy that really annoyed me in the (generally good) report "Farming The Deep Blue", and a presentation here. They project seafood supply and seafood demand as single numbers, and have a gap between them, and say that "supply is not going to meet demand".

I think it's just intuitive to people that we want a certain amount of something - but of course its absurd. I'll eat a lot more sashimi at $1 a plate than $100 a plate! These projections ignore the price mechanism, which serves to balance supply and demand. Really, their projections are saying that prices will go up unless supply grows. Which of course encourages people to get into the industry, and to expand the industry, which is what this conference is all about.

So here are we are, driven by the laws of supply and demand, motivated to remove this "gap" only because it exists - and people still talk as if it's real. That's what happens when you commission govt. reports, I guess. They create a problem, and then suggest more bureaucracy as a way to fix it. I, on the other hand, have every confidence that human greed will do the trick.

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That fallacy is really

That fallacy is really common in discussions of petroleum supply and demand.