Toys To The Rescue?

Most everybody recognizes the Cabbage Patch Kids, and Tickle Me Elmo as two toys that created some of the biggest crazes during the Christmas shopping season in recent history. Robo Sapien is this year's toy that may come close to this level of success. The existence of these toys has two positive affects for retailers: First, they generate a lot of direct revenue since these toys are able to sell out. This will increase the retailer’s profits. Additional profits will lead to higher wages for labor, and higher investment, which leads to more economic activity. Second, these toys bring in a lot of extra people who may not have shopped at this location before. This will not only increase the retailers profits further because of additional purchases the people make while in the store, it will have a multiplier affect on the local economy (The multiplier affect means the money used to purchase an item, is used over again by the new recipients until it is fully spent or saved, therefore multiplying the affect on the economy; The multiplier affect applies best when the original money spent is from a source outside of the relevant market as is the case here). Any growth in economic activity is obviously positive for the entire economy. Soon, the day may come when the economy is having a severe downturn, a toy of the nature of Tickle Me Elmo comes out, and the added economic activity throughout the nation would become enough to stimulate growth in the down turned economy. Toys to the rescue? Sure, why not.