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Tag Archives: Soviet Union

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Done with grocery shopping, you scan the registers and select the shortest line. Standing there for 2 minutes, your time flies. Another minute? Okay. But then, according to research, when the time hits 4 minutes, you believe you have been there for 6 and 5 minutes feel like 10.

In one unscientific study, a reporter compared wait times at 5 NYC supermarkets. He concluded that a central line that directed people to one of 30 registers moved people along quickly. By contrast, with a slow checker or a problem buyer delaying customers, the slowest system was the traditional line at each register. (Studies have confirmed his conclusions.)

Random line facts:

  • To choose a quicker line, a researcher says to divide the number standing in line by the number of customers that join the line each minute. (But, how much time will that use up??)
  • Waiting in line, men typically become impatient at 2 minutes and women at 3.
  • Some suggest avoiding lines with people who tend not to rush like the elderly.
  • Lines surely sped the demise of the former Soviet Union. Employed by the state, sellers cared little about customer service.  Consequently, hours of standing in line eliminated massive amounts of productive activity.

Discussing the merits of the reverse pyramid and back to front, econlife looked at airplane boarding lines here.

The Economic Lesson

A line represents a transaction cost. Defined economically, cost means sacrifice. Standing in line, we are sacrificing what we otherwise might have been doing and thereby adding to the cost of the purchase. During the business day, the transaction cost of a line can be high. During a summer vacation, the cost of standing in line for ice cream can be minimal.

An Economic Question: Using the economic definition of cost, explain why certain people might not mind standing in line while others avoid the experience.

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During August evenings in Nantucket, the lines are long at the Juice Bar. Outside each of two doors is a line stretching along the sidewalk. Once you enter the doors into the shop, you can select among (sort of) 6 lines to get to the counter and order your ice cream.

Analyzing the experience, journalist Anand Giridharas says that forming orderly lines had been equated with “middle class behavior”. In India, traditional lines looked like trees with branches as mini lines sprouted next to the trunk and others cut in. Then, though, with the emergence of a middle class, the acceptance of branches and those who cut in was replaced with orderly single file lines. Similarly, when McDonald’s arrived in Hong Kong, they “introduced queue monitors” to replace the traditional chaos around registers.

Perhaps we can view lines as reflections of democracy and the market. Democracy dictates that we are all equal with the same opportunity cost for our time. The market, instead, implies that those who can pay deserve to go first. I guess whenever we fly, we are choosing between a democratic experience (coach) and the market (first class).  

The Economic Lesson

A line represents a transaction cost. Defined economically, cost means sacrifice. Standing in line, we are sacrificing what we otherwise might have been doing. During the business day, the transaction cost of a line can be high. During a summer vacation, the cost of standing in line at Nantucket’s Juice Bar is minimal.

With lines reflecting the dysfunction of the former Soviet Union, the huge transaction costs helped to speed its demise.

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in this week’s Barron’s, commentator Gene Epstein shares a rather different view of Paul Samuelson from most who eulogized his life. Epstein perceived the economist who has been elevated for bringing math to his discipline as the scholar who needed more so to recognize human unpredictability. Commenting on Samuelson’s analysis of the Soviet Union, he saw a naive individual who failed to see the reality of their false statistics.
Because Epstein sounds rather harsh (although his basic opinions can be defended), I add here a link to a textbook inscription to Greg Mankiw from Paul Samuelson that is special.
http://gregmankiw.blogspot.com/2009/12/memories-of-paul.html

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