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Economics Lessons from "American Gangster"

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Aug 12, 2007
Well I saw this posting at Captain Capitalism's blog( and it was about the movie "American Gangster" and how it gives an economics lesson. I haven't seen the movie yet, thought the posting was cool though:

American Gangster

So I saw American Gangster last night and it hands down is one of the best films I've seen in a long time. However, American Gangster is more an appropriate title than you might think in that Frank Lucas (the gangster and now my new favorite anti-hero) is truly "American" in his entrepreneurship.

The whole movie is about economics and how Frank, who I doubt had his degree in economics, intuitively knew more about markets, supply, demand and business than most Harvard MBA's.

Most impressive was he was probably the first globalization drug-dealing pioneer shopping around the world for the best price of heroin, which landed him in Vietnam. This got him the goods at a mere fraction of the cost it was costing his competitors.

Also impressive was how he immediately established a brand name (Blue Magic) for the heroin packing it in little blue bags and didn't cut the heroin with flour or what have you. It was 100% pure and at 50% the price, which made it an instant hit on the streets. In one scene he even stops in at one of the dealer's club who had been diluting Blue Magic, repackaging it and then selling at as Blue Magic keeping the spread for himself. Rips him apart, not for trying to make a buck, but for destroying a "brand name." He says, "Pepsi is a brand name. Blue Magic is a brand name."

Throughout the movie, though I doubt the writers intended it (I think it was just how interesting this Frank guy was) lessons in economics are abound. There is supply chain management. How do you get the dope from Vietnam to the states. There is competition from other mafias and dealers resulting in cartels and monopolies. Quality management and insurance. Labor negotiations and, ahem, "working conditions."

So for all you educating economists out there, that seem hell bent on making the study of economics seem boring and dreaded by all college freshmen, do them and yourselves a favor. Instead of teaching from the book, have your students watch American Gangster. They can only learn so much from text books, they can learn a lot more about economics through the drug trade.

:) :) :) :)

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MJ DeMarco

Staff member
Read Millionaire Fastlane
Summit Attendee
Speedway Pass
Jul 23, 2007
Fountain Hills, AZ
In my book, I call this a Fastlane thru the ghetto where supply/demand has many imbalances.

Great analysis ... speed++


Read Millionaire Fastlane
Oct 6, 2007
Las Vegas
Very interested in seeing this movie. I'm a sucker for gangster rise to fame type movies like Scarface.

Another thing is how Frank Lucas globalized, and branded his own stuff. Makes you open your mind to international opportunities.


Bronze Contributor
Oct 5, 2007
Mendoza, Argentina
I cant wait to see this movie :)

I have seen every single gangster movie except this one :p



New Contributor
Jul 26, 2007
I got a lot of the same points from the movie..... but in the end it's just a movie. The reality is the cia had a lot of influence in the transportation of the product from southeast asia to the usa.


Apr 16, 2008
I too watched and own this great classic...Great movie about business, marketing, market research, branding and leadership...although it was done in the field of drugs, these principles could've applied to any field.

One thing I love about the movie, is when Frank Lucas (Denzel Washington) was talking about the freedom that comes from owning one's business...He truly sounded like my richdad Robert Kiyosaki.:smxB:


New Contributor
Apr 4, 2009
Sorry Alex. This isn't the way to get started on our forum. Bypassing the forum rules will likely get you banned.


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