Tyler Cowen writes about what should be taught more in econ grad school, Price discrimination. They do it to you more and more! Or perhaps you are striving to do it to others. This is typically covered in a first-year … Continue reading
Note: before the virus crisis dominated the news, I had composed and scheduled a lot of posts. There are still a few left to run. This is one of them. Pragya Kakani, Michael Chernew, and Amitabh Chandra write, Annual inflation … Continue reading
Tyler Cowen writes, My immediate reaction was “Given the crowding in the sector, and that they presumably earn non-pecuniary returns from the enjoyment of teaching, shouldn’t we be taxing them at a higher rate?” He is referring to the low … Continue reading
Timothy Taylor writes, Imagine yourself as the profit-seeking owner of a chain of retail stores. Would you charge the same (or nearly the same) price across all the stores? Or would you vary prices according to average income level of … Continue reading
Alex Tabarrok writes, How could Tesla increase the mileage at the flick of a switch? The answer is that owners of the Tesla 60kWh version of its Model S and Model X actually have the same battery as the 75kWh … Continue reading
A commenter asks, “The real world in which most businesses live is one with high fixed costs and low marginal costs.” Is not two-thirds of the US economy services? I do not see services having the above characteristics, so are … Continue reading
Two years ago, the Executive Office of the President wrote, Ultimately, whether differential pricing helps or harms the average consumer depends on how and where it is used. In a competitive market with transparent pricing, the benefits are likely to … Continue reading
A commenter writes, Standard economics that is taught in intro economics says that higher prices induces greater supply. Under certain restrictive assumptions that is generally true. But there are exceptions. One is when the bulk of the firms costs are … Continue reading
The Washington Post reports, Apps and Web sites that don’t count against the users’ data plan are popping up both in the United States and abroad, often under names like Wikipedia Zero or Facebook Zero. Pointer from Tyler Cowen. If … Continue reading
Tyler Cowen coined the phrase zero marginal product workers, or ZMP, to describe the uneven impact of the 2008 financial crisis on highly-educated and less-educated workers. I think we need to consider ZMP much more broadly. 1. As I wrote … Continue reading