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« Why School Girls Shouldn't Read Hayek | Main | When Will the Next Recession Hit? Maybe That's Not the Best Question »

December 27, 2010

Comments

Stan

I agree. A gallon of gas is worth $3 in town, $4.50 at the "last chance filling station" located at the desert's edge, and $50 if you've run out along the side of the freeway.

Todd

I did an interesting experiment a few years back with this very idea.

I had a garage sale that lasted two weekends. I split half of my garage sale items up randomly and attempted to sell half of the items on different saturdays.

The first saturday I told the customer what I wanted for the item when they asked (too lazy to write price tags). The second saturday I let the customers chose the price (as long as it was above my price floor I accepted).

I made close to twice as much on the second saturday. I figured it would be a way to almost exactly price discriminate. The customers often valued the item more than I would have sold it for. Obviously I did not have a very high value or I wouldnt be selling it at a garage sale.

Interesting backyard economic experiment!

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