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Wednesday, April 28, 2010

On price discrimination and the paradox of choice

Airline prices: The argument against carry-on bag fees | The Economist

"I generally hate a la carte pricing for things that used to come bundled. I especially hate it when it forces me to make complex decisions about things that are trivial and irritating. I hate spending discretion. I want to be offered a price for a service with the normal accoutrements of that service, not ten prices for ten different versions of that service in terms that take me an hour to understand. And I find it implausible that carrying more checked baggage and less carry-ons will make for a smoother airport experience, or that making my airport experience smoother is really a major motivation for most airlines. Basically, I agree with Kevin Drum:

One of the primary causes of personal stress is decisionmaking, and modern life jacks that up every time we're forced to make yet another goddam decision. Do we really want to have to decide if we want the bread or do we just want to enjoy dinner? Do we want a dozen different options on our flight, or would we rather just buy a ticket that includes all the usual stuff?... Choice is good. Most of the time we want it, and economically it's often beneficial. But it can also hide things and make prices hard to compare. Is the Spirit flight really cheaper? Better do a close comparison! Is dinner at Joe's the same price as dinner at Mary's? If Joe charges for bread, maybe not.

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