Wednesday, July 26, 2006

Asscheap Livin'

I came across this article a few days ago. To summarize:

What the Naïve Consumers Don’t Know, Can Help You
The two economics professors — Mr. Laibson at Harvard and Mr. Gabaix at the Massachusetts Institute of Technology and Princeton — have looked at how companies hide fees and costs. They found that sophisticated consumers have somehow learned how to game the system by having enough naïve consumers around to subsidize them.

The smartest strategy, they say, is for the sophisticated consumer to choose the service with the most hidden charges and highest add-on prices, but then avoid paying those added costs. “The sophisticated consumer takes advantage of that,” Mr. Gabaix said. “The naïve pay all the fees.”

No shit sherlock. You don't have to be a Harvard Professor to know that, you just have to be a cheap mofo. In fairness though -- the study claims that businesses don't expose their competitors hidden fees, because they would teach customers how to avoid the fees and lose them to the competitor. I guess some academic fraternity somewhere gives a rats.

I already know this when I'm standing in line at Loblaws behind the yuppie couple while they rings up $240 (and puts it on a credit card!); and on things like a twig of basil for $2.40 and chicken breasts for $10/lb. (Honkies will pay anything to avoid handling a bone). But who cares! it's cos of them I can get half price sushi every night after 9:00.

Another shifty scam is Happy Hour at Big Daddy's Crabshack. The food deals look awesome (because they are), but they nail you with $7 drinks (hose).

The Assbike way, get lubed up beforehand and then enjoy the $3.49 plate of mussels that the hard drinkin' cougars at the next table are paying for. Booyah.



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