> ["Pay it forward" pricing] would seem to defy the logic of free-market economics. Markets, surely, are places where we are allowed, even expected, to behave selfishly.
I do tend to assume that people will act in what they believe to be their own self-interest. (With some emphasis on "what they believe to be".)
But it's not that simple. Take "carpool cheaters" for example - those who drive in the diamond lane without the required number of people in the car.
Say you're driving in the regular congested lane and you see a carpool cheater fly by. I strongly suspect that the vast majority of drivers in this situation will feel at least a bit angry and resentful. After all, the "cheater" took advantage of a special privilege they're not entitled to, while you are following the rules and paying the price.
But if you look at it purely in terms of your own self-interest, the opposite is true. It's one less car in your lane slowing you down - no different at all from an actual carpooler. The "carpool cheater" is doing you a favor by getting out of your way. You will arrive at your destination sooner, thanks to the cheater!
I wonder how many people look at it that way, though. My guess is very few.
It seems that a perception of fairness can easily trump practical self-interest.
Actually, carpool cheaters are not getting out of your way and can most definitely slow you down if they're going the same way you are. Unless the carpool lane runs all the way to your destination, or at least through the source of the traffic jam, the cheaters will need to rejoin the normal traffic flow at some point, and they will be merging in front of you instead of behind you because they cheated. So every cheating car that passes you in the carpool lane and takes a similar path through a bottleneck later is actually delaying you. The same is not true of actual carpool cars taking the lane, because while they put one additional car between you and your destination (like the cheaters), they also offset that by removing at least one car from the road entirely (unlike the cheaters).
More simply, carpool cheaters are cutting in line, which does slow down the line for everyone they cut in front of.
On a multi-lane highway, the carpool that cuts in front of you puts one extra car ahead of you, but there was only a 1/N chance that the car they took off the road would've been in your lane otherwise. So yes, they do slow you down.
The other interesting irrationality is that every other car on the road also slows you down by exactly the same amount as the cheater, yet we're rarely as indignant about the other poor saps on the road as we are about carpool cheaters. So there is definitely a fairness aspect to this; we shrug off folks who inconvenience us with minor annoyance as long as they play by "the rules" for inconveniencing us, but we get mad as soon as someone inconveniences us by not playing by the rules.
The difference is that the cheater is only slowing you down because they're cheating. Otherwise they'd be behind you. We understand that limited road access is allocated on a first come first serve basis, and cheaters are subverting that.
The following of almost all rules requires taking your self interest to a more meta-level.
In this case, yes, it's one less car sharing your lanes. However, it's reducing the incentive for other people to carpool. That erosion of rules can substantially increase the number of cars sharing your lanes.
> But if you look at it purely in terms of your own self-interest, the opposite is true. It's one less car in your lane slowing you down - no different at all from an actual carpooler. The "carpool cheater" is doing you a favor by getting out of your way. You will arrive at your destination sooner, thanks to the cheater!
On paper perhaps, but unless one car is a significant portion of the traffic on the road between you and your destination, one less car means nothing to you.
The reality is that you got to your destination at the same time you otherwise would have, and the cheater benefited from an action he had no right to take.
The point is that each person taking the carpool lane helps you out a little bit and does not hurt you at all. The amount of value you derive from any one person cheating is very small, but every person who does it is benefitting you very slightly. From a perspective of self-interest, we should hope that as many people as possible take the carpool lane, so getting mad over it is an example of people prioritizing community standards over their own interests.
Taking your argument to its logical extension, it then just be optimal to not have carpool-specific lanes at all, and have those be normal lanes.
Practically speaking, that might very well be true. I do not know how effective carpool lanes are at incentivizing car pooling and reducing the overall number of vehicles on the road. (I suspect they're minmally effective, but I have no data to back that up).
I looked into this after they spent a billion in the north bay just to add empty carpool lanes. First of all, many people are unable to change their work habits to accommodate carpooling, and thus a major use of the carpool is simply bringing children to school. Since California is one of the only places in the world with carpool lanes, the studies mainly come from CA universities. Their studies point to a negative effect of carpool lanes on traffic in almost all traffic scenarios, because they are underutilized. Coupled with the fact that they add only negative value for every car that can access them without changing driving habits, there is a reason they have not caught on more widely. My personal evaluation was that they serve a political purpose rather than a practical one, and we pay hard cash for that.
Whether a carpool cheater helps you is dependent on the time scale you are looking at. Sure, on the current trip you may get there faster. But the erosion of the benefit of carpooling may decrease the amount of carpooling and increase the number of cars on the road. Making your future trips longer and longer.
> I do tend to assume that people will act in what they believe to be their own self-interest. (With some emphasis on "what they believe to be".)
I think that's a useful assumption for economics, but not realistic. How does it explain soldiers, risking their lives and health for low pay and horrendous working conditions? People working on free open source projects? People spending extra money on social benefits, such as fair trade coffee or electric/hybrid cars (that is, electric cars that aren't status symbols)? Political activists who dedicate their lives to a cause? People choosing to be parents?
Many people who join the military do it because they have few better career options, and the probability of death or serious injury still isn't extremely high. So in that case it's driven by economic self interest.
Self interest can also mean pursuing non economic benefits that nonetheless provide real, though harder to quantify, value. Like joining the military to gain the respect of your family or community.
Similar motivations around open source code contributions.
People buy fair trade products due to guilt, and I don't say that as a criticism - guilt can be a very pro-social emotion.
Political activists are often motivated by a desire to be accepted and held up by a belief community, whether religious or secular.
And being a biological parent is among the most self interested things you can do.
There are definitely selfish reasons to do all of those things. Examples:
> How does it explain soldiers, risking their lives and health for low pay and horrendous working conditions?
Soldiers defend their own families and friends against invaders who would kill or enslave everyone. That's perfectly reasonable, but it can also be considered selfish.
> People working on free open source projects
FOSS projects can be very interesting and rewarding work, not monetarily but in other ways (in excitement, reputation or maybe glory).
> People spending extra money on social benefits, such as fair trade coffee or electric/hybrid cars
Electric cars are better for the environment, and I imagine many people want a clean environment for everyone, themselves included.
> People choosing to be parents?
One reason to have kids is to have someone to take care of you in your old age (both materially and emotionally). Many people hate the idea of growing old alone.
That wasn't the point. The discussion was about self-interest, not rationality. People act out of self-interest all the time, even when appearing altruistic (it just happens that sometimes the interests of others align with your own interests).
From the article: "People will take more pleasure in buying things if the experience can be blended with something that feels like friendship and gift-exchange. The role of money must be airbrushed out of the picture wherever possible."
This article is mis-titled. It should just be "How business uses social media to sell". (Mis-titling articles has become an industry. It used to be applied to newspaper headlines on the front page only, but now it's everywere, coupled with automatic SEO clickbait optimization.)
Remember, "sharing" is spamming. (Demote people who "share" commercial messages on Facebook from "close friend" to "friend", to stop their spam.)
> This article is mis-titled. It should just be "How business uses social media to sell".
Not really; a big part of the article could be labeled as "marketers are looking new ways to fuck you over, but it's cool; please ignore that we're destroying the most basic human interactions for a quick buck".
> On the face of it, it would seem to defy the logic of free-market economics. Markets, surely, are places where we are allowed, even expected, to behave selfishly.
I don't think most people think of themselves as being in markets.
If I'm normally a nice guy [1] who doesn't take advantage of people, whether they be friends or strangers, then when I am making an ordinary purchase of something I'm not going to stop and think, "Hey...I'm in a market here, so I need to selfish...I can go back to being nice when I'm out of this store and back on the street".
[1] I said if, so no need to go through my comment history and write up an exhaustive proof that I am in fact not a nice guy. I'm speaking hypothetically in the present comment.
I can freely admit that I never consciously think of myself as "being in a market". However, I am very often consciously and often subconsciously doing cost comparisons on virtually all goods and services I buy, which I think is a hallmark of being/acting in a market. I may do this to a greater extent than most, but I think most people are pretty price-conscious, most of the time.
I do tend to assume that people will act in what they believe to be their own self-interest. (With some emphasis on "what they believe to be".)
But it's not that simple. Take "carpool cheaters" for example - those who drive in the diamond lane without the required number of people in the car.
Say you're driving in the regular congested lane and you see a carpool cheater fly by. I strongly suspect that the vast majority of drivers in this situation will feel at least a bit angry and resentful. After all, the "cheater" took advantage of a special privilege they're not entitled to, while you are following the rules and paying the price.
But if you look at it purely in terms of your own self-interest, the opposite is true. It's one less car in your lane slowing you down - no different at all from an actual carpooler. The "carpool cheater" is doing you a favor by getting out of your way. You will arrive at your destination sooner, thanks to the cheater!
I wonder how many people look at it that way, though. My guess is very few.
It seems that a perception of fairness can easily trump practical self-interest.