Unlike Lee, I’m a relatively recent convert to bagels; since their effective potato content is 0%, they have never been especially popular in the home country. But one of the core questions of political economy that has always puzzled me is the dearth of good bagels in DC and associated suburbs. An extensive (if not random) sampling process suggests that Bethesda Bagel is the only tolerably good producer around this neck of the woods. Why is this? It surely can’t be a supply problem – even if it was impossible to make good bagels (because of good water or whatever) in the locality, NY is only a few hours drive for a supply truck in the morning. It surely isn’t a problem of demand either (to judge by Bethesda Bagel’s lines on a Saturday). So what is blocking the purportedly optimizing operation of the free market here?