Well, I made the comment originally because, in the neoclassical framework, would one have any reason to assume that any given cost WASN'T included in the final price?
-JP >From: john hull <[EMAIL PROTECTED]> >Reply-To: [EMAIL PROTECTED] >To: [EMAIL PROTECTED] >Subject: Re: In Praise of Pay Toilets >Date: Tue, 28 May 2002 17:20:34 -0700 (PDT) > >John Perich wrote: > >"Why do you assume the cost of bathroom maintenance >isn't already included in the price charged?" > >I hadn't thought about it. I guess I had assumed, >perhaps incorrectly, that bathroom maintenance costs >would be idependent of the prices charged for goods at >the establishment. Thus bathroom maintenance costs >would not bear on optimizing decisions, in much the >same way that lump-sum taxes are non-disortionary. > >On reflection it has occured to me that prices may >affect bathroom maintenance costs: if Mc.D's charges >less for burgers and obtains more customers, then they >may have more bathroom use which may require more >bathroom cleaning, i.e. an increase in bathroom >maintenance costs. If such were the case (it seems >reasonable), then maintenance costs would enter into >the profit max. problem and would therefore affect the >price, right? That's not a rhetorical question; if >I'm wrong please tell me. > >Well--I think that was what I was thinking anyway: >that bathroom use would be independent of the price. >Of course Michael Etchison may be right as well (if I >read him correctly), in that firms engage in hueristic >pricing and just toss bathroom maintenance into the >mix. (If I read you wrong, Mr. Etchison, I apologize >for that.) That possibility just never crossed my >mind. > >-jsh > > >===== >"...for no one admits that he incurs an obligation to another merely >because that other has done him no wrong." >-Machiavelli, Discourses on Livy, Discourse 16. > >__________________________________________________ >Do You Yahoo!? >Yahoo! - Official partner of 2002 FIFA World Cup >http://fifaworldcup.yahoo.com > _________________________________________________________________ Send and receive Hotmail on your mobile device: http://mobile.msn.com
