Wednesday, November 23, 2011

behavioral economics in action

The New Yorker says "Buy access to the article you're looking for and you'll receive the entire December 9, 1967 issue".

Instead of "In order to access the article you're looking for, you have to pay for the entire issue."

(For 5.99 for one year of access... You don't need reference dependence or loss aversion to explain that one, i.e. the price differential between buying the magazine now and buying a single article from half a century ago, but I suspect they play real roles there too.)

(I swear I have other tools than prospect theory. There just really are so many nails.)

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