Price & Prejudice

12 February 2013, 9:23 AM, Hebbal, Bengaluru

A lot of the finest Taj Mahal red roses are up. The guy from Orissa twiddles his thumbs as the giant board shows Rs. 18.00 as the price per stem. With each tick of the clock, the price drops: Rs. 17.95, Rs. 17.90, Rs. 17.85… He thinks of pushing one of the buttons on the desk before him but resists for now. The price is in a freefall now. Rs. 10.00, Rs. 9.95, Rs. 9.90. He watches. And he waits. The price ticks down. Rs. 7.00, Rs. 6.95, Rs. 6.90. He casually glances at his phone screen before looking up at the board again. Rs. 5.60, Rs. 5.55, Rs. 5.50. Before our man can react, suddenly the clock freezes at Rs. 5.40. He grimaces. Someone just pressed the button and bought 100 of the finest Taj Mahal red roses at Rs. 5.40 a stem.

Every flower tells a story - roses tell us about demand, and tulips once crashed because of supply

No, these are not desperately cheap lovers on a scavenger hunt for affordable roses. But in a way they are also gearing up for Valentine’s Day. They are florists who have come from Bengaluru and other parts of the country to buy flowers in the auctions at the International Flower Auctions Bangalore (IBAF), like they do almost every morning. These are the flowers which will then find their way into the hands of misty eyed romantics and their sweethearts but before those people use them to propose to their lovers, the florists have to propose something for the flowers themselves – the price.

If economics can be boiled down to one word, or one idea, that word or idea would be price. Every economics question directly or indirectly revolves around figuring out if, to borrow from the title of a popular game show, The Price Is Right.

And flowers have had an interesting role to play in it. Back in early 17th century Holland, people got obsessed with tulips, precipitating what could be called history’s first financial bubble - in plain words a situation where something was priced at way more than what could be considered its intrinsic worth. Tulips, you could say, were the original NFTs.

Which brings us back to roses. In that auction in Bengaluru 95% of the flowers bought that day were roses. Valentines Day wasn’t always about roses, but these days growers will do anything to make sure they bloom on schedule for the big demand shift in the middle of February each year - using everything from temperature control to potassium to plant hormones.

Roses became a thing as Valentine's Day became a big deal. Flower shops couldn’t keep up with demand with just locally grown flowers and they needed something that could be ordered in scale and from the Southern Hemisphere, because February is winter in the Northern Hemisphere. What could fit the timing and stand the journey? The rose, of course! They are pretty much indestructible when being transported and were perfect to be passed through the global supply chain the rapidly globalising modern economy had built. Like Robert Smith said on Planet Money once “We actually started to like roses because they were optimized for the global transportation chain.”

And that’s how we ended up with what sounds like an umbilical connection between roses and Valentine’s Day, but was really manufactured in the workshop that is the global economy, because, you know, the price was right.

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