Volatility in Flower Prices
Garber compared the available price data on tulips to hyacinth prices at the beginning of the 19th century—when the hyacinth replaced the tulip as the fashionable flower—and found a similar pattern. When hyacinths were introduced florists strove with one another to grow beautiful hyacinth flowers, as demand was strong. However, as people became more accustomed to hyacinths the prices began to fall. The most expensive bulbs fell to 1 to 2 percent of their peak value within 30 years. Garber also notes that, "a small quantity of prototype lily bulbs recently was sold for 1 million guilders ($480,000 at 1987 exchange rates)", demonstrating that even today flowers can command extremely high prices. Additionally, because the rise in prices occurred after bulbs were planted for the year, growers would not have had an opportunity to increase production in response to price.
Read more about this topic: Tulip Mania
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