Category: Economics

Birthdays: Candles and Kids

 Today I learned:

1. Birthday candles: I always wondered at what age people give up trying to add the correct number of candles to your birthday cake. Today I learned that age is 37, and there is a very simple reason for it: Economics.

Everything up to 36 requires only one box of candles. It costs the same to decorate a cake for my 2 year as it does for my 4 year old, or for that matter for my wife.

But not for me.

As of today I am officially a 2 box’er.  In a monetary sense at least it just isn’t worth it.

2. Kids: Sitting at the table tonight eating a 36-candle cake (lovingly made by my wife and kids) it occured to me that I enjoy my birthday now far more than I did a few years ago. You might expect that the reverse would be true. I am getting to an age where people start to worry about the number, but that doesn’t bother me. 37 is no worse to me than 35 or even 25 as far as I am concerned.

It is more that before kids I just didn’t pay much attention to birthdays. Now I can’t avoid them. At any moment in time the kids can spout off the next three birthdays in our extended family, and the number of sleeps to the next one. They love birthdays and a celebration is required. What I saw as just another day is to them a very, very big day. I don’t think they could even comprehend the possibility that I might not have agreed with them.

I think a lot of adults are like me. We go on day by day and don’t pay much attention to things like our birthday. Not everyone is like that though – I work with a few people that take a vacation day on their birthday every year.  I always considered it kind of silly – why waste vacation day on a rainy Tuesday in November? -I am now just starting to get it. My kids have helped teach me that I need to rethink my position.  It can be a good day, and if I want it can be a great day.

Why not?

Time to open a nice bottle of wine.

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The Marginal Cost of Email and Price discrimination at the Parking Meter

Today I learned:

1. The marginal cost of an email is not always zero: Witty banter back and forth via email is a lot less fun when it’s a lawyer on the other end of the exchange and you know she bills you $20 every time she reads one of your messages.

This made me wonder, if I knew I was going to be invoiced $20 every time a recipient read one of my messages, how many emails would I actually send?

I am guessing a lot fewer.

So, should I build that into my decision-making criteria when determining whether or not to use email for certain types of communication?

I am guessing I should.

2. Perfect Price Discrimination for…Parking? The headline in today’s Vancouver Sun reads “Vancouver Parking rates could vary by block, month with new project.” Apparently 1500 of the city’s 10,000 meters can now have rates remotely changed.

The issue?  Not enough people are using transit, resulting in drivers parking illegally or circling around looking for spots in busy locations.

The solution? Remotely altering parking prices will allow the city to control consumption patterns with the goal of ensuring there will always be one open spot on every block. According to Jerry Dobrovolny, Vancouver’s director of transportation, “the reason for getting the right price is that the wrong price does so much harm.”

To that, I call bullsh*t.

This has nothing to do with the environment and everything to do with revenue. In fact, the lesson I learned here is that the city is actually smart enough to notice the technology now exists to take aim at perfect price discrimination for parking spots. They understand that with a bit of effort and investment they quickly change the cost of a spot to find the right buyer and then reap the rewards. They will have a model where they can extract more of the consumer surplus available.

To be clear I have no real issue with the direction they are going with this. It is brilliant. The city deserves kudos for figuring this one out.  As a resident of Vancouver I know just how many people will be coming in from the suburbs everyday to fill the meters and in turn add to the cities coffers. I just wish they were more honest about it.