I know of that line of apparel only because I have seen the name stenciled across the shirts and sweaters of its devotees. I infer that they are really nice clothes. Somehow I want to own some.

Which makes me wonder why they are not just giving their clothes away. We get free shirts, they get to drape their brand name across our bodies. Perhaps they would be selective about which bodies, but there must be a market opportunity here. If brand recognition drives sales then the eventual premium they could charge would seem to justify a lot of free hoodies up front. How else can we explain Abercrombie and Fitch, once a middling brand of fishing/hunting wear now international purveyors of pre-teen libido?

Normally this kind of rent seeking would be doubly inefficient. Resources wasted in a competition to corner the market, then the inefficient scarcity under the resulting monopoly. But in this case the rent seeking behavior involves giving away the stuff that’s eventually going to be so scarce. Moreover, since we apparently want to wear only the coolest clothes, the eventual monopoly may in fact be the first-best outcome.  So we have firms competing to create the surplus maximizing market structure and in the process handing out all the accompanying rents in the form of euro-inscripted jeggings.

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