You might be forgiven for expecting that during the harvest season that prices for the things being harvested are lower than at times of the year when these crops are less commonly available. I expect that too.
So here is a little question for my students. If you go to Wegmans and buy a small can of pumpkins in May or June, you are likely to pay just a few cents for the equivalent of a small pumpkin. But when our family took a trip out to Pumpkinville farms the other day (you know those kind of places where you can feed goats, take tractor rides, eat cider donuts, and even pick pumpkins), you would have noticed that prices for very small pumpkins were around $4.00 and for larger pumpkins (by no means the Great Pumpkin) were around $12.00. I thought that your economics textbook taught you that when the supply of pumpkins increases, pumpkin prices should fall. This is an indirect way of stating that demand curves slope downward. But clearly, at Pumpkinville and all of the other pretty farms we passed along the roadside, there was an abundance of pumpkins, all selling at prices higher than I think I recall seeing in Wegmans a few months ago. What is going on?