Welcome to Econ Talk, part of the Library of Economics and Liberty. I'm your host Russ Roberts

of George Mason University and Stanford University's Hoover Institution. Our website is econtalk.org

where you can subscribe, find other episodes, comment on this podcast, and find links to

other information related to today's conversation. Our email address is mail at econtalk.org. We'd

love to hear from you.

Today is July 27th, 2011, and my guest is Brendan O'Donohoe, director of Zone Sales for Frito

Lay, which is part of PepsiCo. Our topic today is the potato chip and salty snacks generally,

Brendan, welcome to econtalk.

Thanks for having me, Russ. It's great to be here.

One of my favorite lines is from Walter Williams, and he and I discussed it when he was a guest

her a few years ago. Walter likes to describe his relationship with his grocery in the following way.

I don't tell them what I'm coming. I don't tell them what I want to buy or how much, but if they

don't have it when I get there, I fire them. And like Walter, I too like to marvel at how the shelves

were always full. And of course, long-time listeners know about my interest in the power of

emergent order, that they're always bagels at the bagel shop, no one's in charge of that.

While there is something almost magical about the power of markets to provide the goods and services

that we wanted, prices that make us pretty happy, there is stuff going on in the ground level that

actually makes that happen. And the other tie into this is that a lot of people talk about a

higheckian world, an emergent order world where there's no planning. Well, there's a ton of planning.

There's no planning from the top down, but there's islands of planning in the sea of

emergent order. And what we're going to talk about today is how that planning takes place to

make sure that the potato chips that you want to buy are sitting in the grocery store. And what

...