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Published on Jul 6, 2011
The number of Internet users worldwide has now surpassed two billion and so many of us have integrated the web into our lives so much that it's hard to quantify how much it's worth to us. But why not give it a shot? Think about it.
How much would someone have to pay you to give up the Internet for the rest of your life?
Would a million dollars be enough? Twenty million? How about a billion dollars?
"When I ask my students this question, they say you couldn't pay me enough," says Professor Michael Cox, director of the O'Neil Center for Global Markets and Freedom at Southern Methodist University's Cox School of Business.
The free market, says Cox, creates a huge gap between what consumers would be willing to pay for Internet access and how much it actually costs.
It's cheap to get online and getting cheaper all the time. We see the same pattern with many other products. Take the cell phone. When it first arrived in the 1980s, the cell phone had no apps, no music, and no Internet access--it was pretty much a brick with buttons. Yet that brick cost about $4,000, and that's why only the super rich could afford them (think Gordon Gekko in Wall Street). Today, it takes only about 40 bucks to walk home with an iPhone.
Turns out capitalism has its own built in welfare transfer system.
"When a new product comes out we all get in line for it," says Cox. "The wealthiest people are in the front of the line and they pay the highest price for the worst version of a product." Real life Gordon Gekkos buy the products when they're expensive, and that lets the rest of us enjoy the cheaper, better versions.
Even in a lousy economy we all enjoy things, from smart phones to aspirin to air conditioning, that weren't available to the world's wealthiest people just a short while ago. And if we have access to something like the Internet, something that's worth so much to us, we just might be richer than we realize.