New Year, New Steam Sale

Cross post from Substack

I keep receiving emails that Star Wars Squadron is only $2.50. Wild! I love Star Wars, and when I was a kid I loved flying around all the planes and stuff.

But why such a big special? And why are lots of computer games on a big sale now?

I mean surely this is the time when demand is high (a lot of people are on holiday) and computer games are a durable good (you pay up front, and then consume them over time).

As a result, this must be the time when people are most willing to pay for it – and the incentive to discount must be pretty weak because if you sell a game to someone now, you can’t sell it to them again in the future.

So let’s have a think about why this may be going on – and I promise not to talk about tacit collusion this time. Instead lets talk price discrimination.

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Where have all the good Boxing Day sales gone

Cross post from Substack.

It’s Boxing Day – and I’ve already used up the idea of discussing the now largely missing Boxing Day sales. And the idea that Boxing Day is increasingly lame is common across years.

So instead the focus of today will be on a different industrial economics topic – the state of competition in Australia. Specifically, does the lack of Boxing Day sales tell us something about the level of competition in Aussie?

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Is haggling good actually? (video and transcript)

In a recent video Gulnara gave us some background of haggling in the former Soviet Union, and we tried to understand some of the way we could evaluate whether it is “good or bad” beyond the standard “haggling allows for optimal price discovery” vs “haggling adds transaction costs to trading”. The video can be found here.

For those who don’t like video and just want to read the text, it can be found below.

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Why is cold and flu medication cheaper in winter? (video and transcript)

In a recent video we’ve chatted about why cold and flu medication may be cheaper in winter than in summer – something that may seem a bit counter-intuitive. This was an issue discussed back in 2008 here and here.

For those who aren’t keen on listening to videos, I’ve popped the transcript just below 😉

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Have supermarket prices shot up? Evidence from the Stats NZ data

I have been hearing anecdotes from my friends in Europe that prices in supermarkets have increased since the last couple of months. Interested I had a look online and found a number of articles outlining this around the world.

According to the media, NZ shoppers have faced this as well. 

“Some customers have taken to social media to complain that prices of items like soap, meat and fresh veggies have increased sharply.”

However, supermarkets kept denying the fact. It’s hard to judge the case from my experience, as Matt and I were lazy and were primarily eating outside before the lockdown. However, Stats NZ provides data here – so let’s look at the latest release on the Food price index to figure out whether the customers are right.

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Why are all the shops so close to each other?

Gulnara keeps telling me that she needs to go shopping – but of course there is a nationwide quarantine so she’s stuck at home listening to me.

Although I feel some sympathy with her situation, I was worried that I will get dragged all around the place when we do go shopping in the future – and so we’ve gone online to look at Google Maps to figure out where we’ll need to walk. Having a look it appears we won’t have to walk around that far – as the clothing and perfume stores with amazing interior signage projects.

So why is this?

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