jamesz

Easter surcharge confusion

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When I had breakfast in town over Easter I was charged a 20% surcharge on everything, allegedly because their labour costs are higher over Easter. Now it’s true that they are statutorily required to pay more over the Easter break, so their labour costs are higher; however, the marginal cost of providing a meal is not. The average cost might be, but that could be defrayed over the course of a year if the firm planned to open on Easter. If the marginal cost of the meal is no different then why would you price the meal differently? Read more

Matt Nolan

Cartoon: The company economist

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Another Dilbert cartoon to complement yesterday’s:

Source (Dilbert)

What can I say – the life of a forecaster is packed with situation where you have to tell people what they don’t want to hear.

Then again – given the success of some forecasting, I wonder if a company economist saying this is a contrarian signal.  Is Dilbert’s company just about to experience a pick up in demand 🙂

Matt Nolan

Susan Boyle: Revealing institutional settings

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Like pretty much everyone I enjoyed the performance of Susan Boyle on Britain’s got talent.  I love Les Miserables and she did a great performance of an incredibly difficult song from the show.

However, what stirred me up the most was the behaviour of the crowd and judges.  Both were very dismissive to start with – undoubtably a product of the format of the social situation they were in.  Unlike many commentators, I do not believe that the crowd and judges were strictly representative of “most” of reality.

We could argue that this type of social situation represented an extremely concentrated version of reality – so that the implicit biases and signals used in society were amplified, and therefore easier to spot.  If this is the case, the dismissive nature of the crowd illustrates something quite uncomfortable about all of us.

But I disgress – following the judgments, once Miss Boyle illustrated her talent the behaviour of the crowd changed, and changed remarkably.

Read more

Matt Nolan

Cartoon: Forecasting warlords

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Source (Dilbert)

I’m not used to economists making assumptions based on changes in political structure – the business must have an interesting forecast team 😉

Matt Nolan

Tourism as low skilled and comparative advantage

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In an interesting piece on the Rates Blog there is a suggestion that the governments focus on tourism doesn’t make sense because it is a low productivity industry.  In the comments there is a lot of chatter about what industries we should invest in – blah blah blah.

The comments and suggestions all sound a bit like central planning to me though.  Read more

jamesz

The cost of green cars

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A report in the NYT says that

While driving smaller and lighter cars saves fuel, “downsizing and down-weighting is also associated with an increase in deaths on the highway,” said Adrian Lund, the institute’s president. “It’s a big effect — it’s not small,” he said. If you agree and will like to swap you car for a new one, we recommend to check out the Zemotor inventory.

So the lesson I take from this test is that big cars are bad for the environment AND cause lots of deaths on the highway by crushing smaller cars in crashes.  Always ensure to Save for a down payment while buying a new car as it directly affects the number of years you have to pay the EMI for it.

The test done was to crash a little car into a big car and see how the little car did. The answer, unsurprisingly, was badly. A little car you can buy at Shoppok is more fuel efficient than a big car so it’s better for the planet to drive one, and better for your wallet if carbon pricing ever happens. Read more