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Freedomnomics:

I just finished reading John Lott's marvelous and entertaining book Freedomnomics: Why the Free Market Works and Other Half-Baked Theories Don't. It is very well-written and it really reminds you of what an extraordinarily creative and interesting thinker Lott is. Much of the book is a translation of his many papers in different areas into prose and concepts accessible to general readers.

Peter Boettke, in the GMU Economics Department, is fond of observing that there are two places where you can find economics problems--by looking at the blackboard (theory) or looking out the window (the real world). What makes Lott such an interesting thinker to me is that he has a great knack for looking out the window for interesting problems and then coming up with original ways of thinking about them.

When I teach law & economics, one of the key puzzles I start with is Akerlof's "lemons theory." But the real question about the lemons theory, it seems to me, is why if it seems so theoretically sound, why don't we actually see it more often in the real world? The answer, of course, is that there are a host of institutions that arise to address the lemons problem so that people can actually engage in trade, most obviously contract law, but other institutions such as reputations, repeat dealing, etc. Gordon Tullock similarly posed the question long ago about why there is so much stability in legislatures when theory seems to predict a much higher rate of cycling than is actually observed.

Lott's book strikes a similar balance with Freakonomics. Now let me emphasize that I really enjoyed Freakonomics and thought it a very interesting and provocative book. Lott picks up on the point, however, that Freakonomics sometimes only seems to tell part of the story--in the same way that it would be a mistake to simply read Akerlof and assume that was the end of the story. Lott shows how formal and informal institutions arise that discipline much of the cheating and inefficiencies of the market that might otherwise prevail. He also does a very good job of providing an argument for why it is that certain market practices that may seem irrational (such as price mark-ups on liquor in restaurants) may actually have a sound economic logic to them. Even if one isn't persuaded on some of these points, the arguments are logical and fun to read.

Probably the most interesting chapter to VC readers would be his central chapter on the law & economics of crime. This is one of the best overviews and literature reviews that I have read on the topic, both as to how to think about an economic analysis of crime as well as empirical work on the subject. His primary focus in the dramatic decline in crime rates in the 1990s and discusses the various theories that have been advanced to explain it. This chapter seemed to me to be extremely strong and touched on a lot of key issues--guns, capital punishment, etc. He also summarizes his critiques of Donahue and Levitt's argument that legalized abortion generated a drop in the crime rate. The debate on this issue continues. It struck me more generally that for criminal law professors who wanted to introduce their students to the economic analysis of criminal law, Lott's chapter provides an accessible and wide-ranging discussion of the issue that potentially would be a great teaching tool.

Overall, I thought this was a really fun and interesting book, one of those ones that has you saying every page or two "Hmm, I didn't know that" or "I never thought of it that way." For those who like this general genre of economic puzzle-solving (which I do), I highly recommend it.

Dilan Esper (mail) (www):
The "looking out the window" comment reminds me of an old economists' joke:

This economist was out an inner city job placement center, observing how the new welfare reforms were working. He saw all these people dressed up for job interviews, polishing their resumes, and being placed with jobs. He was impressed with several single mothers who told them how the program had turned their lives around.

Beaming, the center's director said to the economist "you see how well this works in practice?". The economist replied "yes, but does it work in theory?".
9.27.2007 4:38pm
pritesh (mail):
Comment deleted.
9.27.2007 4:48pm
GV_:
Comment deleted.
9.27.2007 4:48pm
Zywicki (mail):
I thought this wouldn't be necessary to say, but let's please keep Comments respectful and on-point of the book. Inappropriate comments have and will be deleted.
9.27.2007 4:55pm
Pon Raul:
Comment deleted.
9.27.2007 5:06pm
frankcross (mail):
Among the institutions that prevent the "lemons" problem you might want to add government regulation.

The evidence is pretty clear that some aspects of securities regulation are the key to reducing lemons in the stock market
9.27.2007 5:11pm
Cornellian (mail):
It would be a terrible irony if John Lott were related to Sen. Trent Lott.
9.27.2007 5:18pm
CJColucci:
Wow. Three of the first seven comments deleted. How many of them were Mary Roush jokes?
9.27.2007 5:29pm
Temp Guest (mail):
This is a little off topic, but I hope permissible: I can guess what the "comment deleted" posters have to say. Lott's research on the relation between presumptive right-to-carry laws and crime levels permanently annihilated the canard that such laws would result in increases in violent crime. His research and analyses incontrevertibly prove that is not the case. The best his critics could do was argue -- some more some less effectively -- that his data and analyses did not support his further conclusion that right-to-carry laws actually reduce crime. He was bitterly hounded by his critics on this to the point that he engaged in some unfortunate defensive strategies, e.g., posting defenses on the internet using aliases. His ideological enemies have used this against him primarily to try and diminish the importance of his primary findings. Leftist criminologists, like the cuttlefish, use massive quantities of ink to cover their tracks when they're scared and running. Gun controllers will never forgive Lott his research on this topic although it is, overall, a model of honest scientific research. I have read many of Lott's subsequent essays with pleasure and look forward to buying and reading this book.
9.27.2007 5:30pm
Joe Bingham (mail):
For clarification: what we're not to talk about is Levitt's treatment of Lott, correct?
9.27.2007 5:45pm
Anderson (mail):
Obviously, I should read Prof. Lott's book, whatever his character or history.
9.27.2007 6:10pm
Angus:
I don't know why the comments were deleted, but Temp Guest's speculation is probably correct. If Lott has done things to bring his credibility into question, isn't that a legitimate matter to discuss when talking about his work?
9.27.2007 6:13pm
Sasha Volokh (mail) (www):
I do think the subtitle is a bit unfortunate: "Why the Free Market Works and Other Half-Baked Theories Don't." So the free market is a half-baked theory? Perhaps a well-placed comma [or two] would have done the trick: "Why the Free Market Works and Other, Half-Baked[,] Theories Don't"?
9.27.2007 6:16pm
eric (mail):

If Lott has done things to bring his credibility into question, isn't that a legitimate matter to discuss when talking about his work?


I personally like the thread policing. So many posters try to hijack threads.
9.27.2007 6:31pm
Hattio (mail):
So, where do I get a quick pointer to the lemon problem in economics?
9.27.2007 6:34pm
Justin (mail):
I'll save everyone the time. Comment deleted.

(Comment was referencing John Lott's lack of credibility combined with his combatitive arguments and his creative ability to manipulate numbers to come to a predetermined outcome making any claims his book has - particularly given such an overreaching, debated-to-death topic, makes it highly unlikely the book will have any useful value beyond giving fellow travelers a pat on the back).
9.27.2007 6:34pm
33yearprof:
If Lott has done things to bring his credibility into question, isn't that a legitimate matter to discuss when talking about his work?


Hardly. The advantage (disadvantage to some) of written scholarship is that the work, as my Grandfather used to say "stands on its own bottom." It doesn't matter if the author is a jerk, a fine fellow, or a hermit.

In Lott's case (or Donahue's), either the data [which Lott will provide to any other scholar and probably to anyone at all] and/or the analysis [which you can read for yourself] is valid or it's not. Skin color, nose picking, and 5-year old embarrassing moments notwithstanding.

The ad hominem attacks continue because there are no sound attacks on his work and conclusions. They have been reduced to empty bad-mouthing.
9.27.2007 6:37pm
Sean O'Hara (mail) (www):

I do think the subtitle is a bit unfortunate: "Why the Free Market Works and Other Half-Baked Theories Don't." So the free market is a half-baked theory?


That was my first thought, too, but then I realized he means the whole field of economics is half-baked. So nice to see an economist acknowledge this for a change.

*ducks*
9.27.2007 6:39pm
Justin (mail):
33year prof,

that's all well and good if people had unlimited time on earth to read and deconstruct everything. But if I read the book, and then analyze the data, and put it through a more basic regression and come up with different results, and/or collect more rationally-linked data and come up with different conclusions, will anyone compensate me for my time?
9.27.2007 6:44pm
GV_:
My deleted comment was a more snide way of saying what Justin said at 5:34 p.m. I also had included a link to wikipedia regarding John Lott, so you could see the state of his credibility. (Wikipedia, of course, provided both pro and con links.)
9.27.2007 6:49pm
Rostoff:

The best his critics could do was argue -- some more some less effectively -- that his data and analyses did not support his further conclusion that right-to-carry laws actually reduce crime. He was bitterly hounded by his critics on this to the point that he engaged in some unfortunate defensive strategies, e.g., posting defenses on the internet using aliases.


Please.
9.27.2007 6:53pm
33yearprof:
But if I read the book, and then analyze the data, and put it through a more basic regression and come up with different results, and/or collect more rationally-linked data and come up with different conclusions, will anyone compensate me for my time?


Not unless your work adds some value to the criticism's of Donahue and Levitt (both of which Lott cites).

An ad hominem attack is still ad hominem even if the author IS a nose-picker.
9.27.2007 7:03pm
Justin (mail):
33yearoldprof,

I'm surprised you're a prof. Your argument makes sense in Logic 101, but when dealing with fact-intensive subjects and highly complex arguments, the Kantian idea that a work can stand on its own for the commons to read seems odd.

Not to mention the dire logical fallacy in your argument - that because Lott cites Levitt and Donohuse, Levitt and Donohue is responsive to Lott's later-in-time piece (nevermind if the relatively-pro-market Levitt and Donohue are even the most relevant response to the titled argument).
9.27.2007 7:15pm
allwrits (mail):
Heavens forbid, is someone suggesting that there isn't "intellectual freedom" on VC? Does this guy Lott really come with that much baggage that people who don't have the foggiest who he is must be prevented from learning about the skeletons in his closet that may impact on his intellectual honesty?

I was considering perusing the books crim law section. After the comment censoring, I probably won't.

33year -- Are you Lott/Roush?
9.27.2007 7:16pm
Justin (mail):
And as I've argued in the past, an ad hominen reaction to an argument is an acceptable substitute, when, due to a lack of perfect and effecient exchanges of information, the critic must otherwise take some of the underlying claims of the argument at the word of the one making the argument - which is precisely the problem with Lott and his manipulation of complex regressions.
9.27.2007 7:17pm
Elliot Reed:
If Lott has done things to bring his credibility into question, isn't that a legitimate matter to discuss when talking about his work?
Hardly. The advantage (disadvantage to some) of written scholarship is that the work, as my Grandfather used to say "stands on its own bottom." It doesn't matter if the author is a jerk, a fine fellow, or a hermit.
Unless one has the time, inclination, and ability to go back and check all the references, any argument based on complex facts is to some extent an argument from authority. One must trust that the person making the argument is not misrepresenting the evidence or falsifying data. It is quite possible to produce a book full of footnotes and citations without any of the sources actually supporting your point. Lott has a track record of data falsification in support of an ideologically predetermined point, which is directly relevant to whether the non-expert reader can trust the purported facts that he cites.
9.27.2007 7:28pm
Roger Schlafly (www):
Lott has a track record of data falsification ...
If that were true, then it would be worth mentioning. But the Wikipedia article doesn't say that. It says that he has used a sock puppet, and that some people don't approve of that, but that doesn't have much bearing on the validity of what is in his book.
9.27.2007 7:44pm
Dave Wangen (mail):

But if I read the book, and then analyze the data, and put it through a more basic regression and come up with different results, and/or collect more rationally-linked data and come up with different conclusions, will anyone compensate me for my time?


Judging by the amount of people interested in condemning him, if you do all that, and publish your own novel as a response? They almost certainly _will_ compensate you for your time.

So, what are you waiting for?
9.27.2007 7:51pm
33yearprof:
Justin posted:
for the commons to read


No problem as long as the elitists are still out in great numbers.

P. S. No, I'm not a sock puppet. Are you related to the Australian Lott hater?
9.27.2007 7:54pm
David M. Nieporent (www):
Roger, there's a controversy over whether a particular survey Lott claims to have conducted about defensive gun uses was actually conducted. The Conspiracy's Jim Lindgren can actually speak to that, if you're interested.

But that survey was tangential to Lott's main findings, which were about crime rates and gun ownership, not DGUs.
9.27.2007 7:58pm
American Psikhushka (mail) (www):
Sheesh, what's wrong with nose-picking? People are acting like it's something dirty and reprehensible, like double-dipping, or working in academia.

God gave me my face, but he let me pick my nose.
9.27.2007 8:27pm
PLR:
I wonder if I can make one on topic point and one off topic point and not get deleted, kind of like dirty movies in the 70s would have one random political monologue for socially redeeming value.

On topic: What free market? You mean our hybrid market?

Off topic: Before this I had heard of Trent Lott and Ronnie Lott, but never John Lott. Now that I've learned about him, I get this funny feeling when I re-read the intro to this topic:

"I just finished reading John Lott's marvelous and entertaining book ... very well-written and it really reminds you of what an extraordinarily creative and interesting thinker Lott is ..."
9.27.2007 8:30pm
Alaska Jack (mail):
I hope everyone will forgive me for making a more-or-less on-topic post.

This passage got my attention:

He also does a very good job of providing an argument for why it is that certain market practices that may seem irrational (such as price mark-ups on liquor in restaurants) may actually have a sound economic logic to them

It reminded me of something that puzzled me. Everyone knows how expensive the popcorn, candy etc. is in a movie theater. The common explanation I've heard for this is that theaters don't make much from the movies themselves, so they have to make up the difference via the concessions.

But wait a minute, thinks myself. The Raisinets and Jujubees should work along the same economic principles as everything else. That is, presumably there should be a price at which the theater will maximize revenue from concessions, regardless of the price or cost of the movies. If they charge over that price, they lose revenue, because people (like me) simply stop buying.

To put it another way, it can't be the case that the Theater makes more money simply by marking up the price of popcorn. If it were the case, then why stop at $5? Why not $50? Or $500?

Anyone have any insight on this?

- Alaska Jack
9.27.2007 8:50pm
Alaska Jack (mail):
Oops, meant to blockquote that passage. Sorry.

- AJ
9.27.2007 8:51pm
x (mail):
One must trust that the person making the argument is not misrepresenting the evidence or falsifying data. It is quite possible to produce a book full of footnotes and citations without any of the sources actually supporting your point.

Elliot Reed
I think you have John Lott confused with someone else who wrote a book about guns.
9.27.2007 9:22pm
frankcross (mail):
Alaska Jack, it's because they have a functional monopoly on in theatre sales. They mark up the price to the monopolist's price rather than the price constrained by competition.

They make less profit on movies, presumably, because that is a competitive market.
9.27.2007 9:40pm
Stating the Obvious (mail):
Frank,

Alaska Jack, it's because they have a functional monopoly on in theatre sales. They mark up the price to the monopolist's price rather than the price constrained by competition.

They make less profit on movies, presumably, because that is a competitive market.
——-
It's more complicated than that. Steven Landsburg has written about this. Try:
page 48 at:
Professional Guide to Value Pricing
9.27.2007 10:19pm
Stating the Obvious (mail):
My apologies for the above URL. Turns out this is a chapter that summarizes Landsburg's argument, and the entire chapter is not present on the web, so part of the argument is omitted (the part there is quick and fun reading, though).

You CAN find Landsburg's argument in his book, The Armchair Economist. It doesn't completely answer the question about popcorn prices, but it does explain very nicely why standard answers like Alaska Jack's are not correct.
9.27.2007 10:38pm
Stating the Obvious (mail):
My apologies again. In the last line of my last post, substitute "Frank Cross" for "Alaska Jack".
9.27.2007 10:39pm
Blar (mail) (www):
Lott's academic malpractice goes well beyond the widely known Mary Rosh saga, including actions that are much more directly related to the reliability of his research. Here is a description of another case of his dishonesty, which focuses on the methods that he uses when he is conducting his research (a more technical description is here).

Basically, Lott published a model, applied to a data set that he had, which implied that more guns meant less crime. Then some errors were discovered in the data set, and applying Lott's model to the corrected data set showed no relationship between guns and crime. So Lott came out with a new model, which, when applied to the corrected data set, again showed that more guns meant less crime. And when he did this, he tried to hide the fact that he had switched models.

This incident provides fairly strong evidence that one of the criteria that Lott uses, when he's building a model, is that it must give the results that he wants to get. In other words, you can't trust his research, because his methods are designed to get the results that he wants, not to find out what relationships are actually present in the data.
9.27.2007 10:39pm
David M. Nieporent (www):
Stating the Obvious: you beat me to it, but Alaska Jack can read about it in Landsburg pop-econ book The Armchair Economist.

The short answer is: price discrimination.
9.27.2007 10:47pm
Alaska Jack (mail):
"Alaska Jack can read about it in Landsburg pop-econ book The Armchair Economist

Well, I guess I was kind of hoping someone could just tell me.

As for Frankcross's comment, that certainly would appear to be the obvious reason. It just didn't sit right with me, though, because of two things. First, concessions are a non-essential. You always have the alternative of saying "no." (Or, more accurately, something along the lines of "$8 for a tub of popcorn? You have got to be *$#@!ing me!"). Second, you usually have the alternative of popping into the local Kwik-E-Mart and buying your own candy. Not that I would ever dream of doing this.

The few explanations I could think of didn't seem satisfying.

1. Theater chains have so thoroughly brainwashed moviegoers that their concessions are better, that the customers gladly pay the inflated prices. Possible, I guess, if you believe in the false consciousness of the bourgeoisie and whatnot.

2. Moviegoers MUST HAVE popcorn, which isn't easily smuggled in. But then why the markup on Raisinets?

3. Customers feel charitable toward the struggling movie industry, and want to help out their local mom-and-pop megaplex. Seems unlikely.

4. Moviegoers are too lazy to stop into the convenience stores on their way to the multiplex. Some of them, sure, but all (or even most) of them? That's why it's called a CONVENIENCE store. Are you telling me they don't even have any Oreos or Hershey's Kisses in the cupboard above the refridgerator* at home?

5. Many moviegoers are single and male, and don't have a female counterpart (or suitable metrosexual male acquaintance) with a purse suitable for smuggling. Why can't they just wear a jacket like I do would if I were into that kind of thing?

And so on.

- Alaska Jack

* wink
9.27.2007 11:26pm
Constant (mail):
"And when he did this, he tried to hide the fact that he had switched models."

That looks suspiciously like mind-reading. If that's the strong part of the evidence against him then in essence there is no evidence against him. Innocent victims of left-wing attacks typically are much more viciously attacked. For example Chagnon supposedly committed genocide. So if this is the best that Lott's critics can come up with, Lott must be some sort of paragon.
9.27.2007 11:48pm
frankcross (mail):
Well, the obvious flaw in my answer was that there should be competition on popcorn prices as part of the competition for the movie dollar. My answer this is twofold: (a) there's not much competition on this, people want to see certain movies and won't sacrifice for lower popcorn prices (which suggests inefficiences in movie pricing, I admit) and (b) a behavioral one, that people really don't consider the full price of movies and overlook the popcorn surcharge. I really think this is the answer, though Alaska Jack's most recent post suggests another hypothesis that probably has some truth -- price discrimination. The movies accept a certain amount of smuggling of Raisinets by the price sensitive in order to make a high profit from the price insensitive. For a lot of people another dollar isn't worth a trip to the convenience store.
9.27.2007 11:49pm
Elliot Reed:
David - sure, the study Lott fabricated was tangential to his main results. But making up data is the ultimate scientific sin, and casts a cloud over the rest of the man's research.

x - I'm perfectly aware of the Bellesiles fraud. That doesn't excuse (admittedly less serious) fraud by Lott.
9.28.2007 12:04am
Dennis Todd (mail):
A fairly comprehensive and balanced page of links over the Lambert critique and others can be found here
9.28.2007 12:52am
Brian K (mail):
Those are some very informative links Dennis.
9.28.2007 1:21am
Jake (Guest):
Alaska Jack: Some moviegoers are willing to pay $10 for a "fun movie experience". Some are willing to pay $20 for a "fun movie experience". How can you extract maximum cash from the $20 folks while still getting some money from the $10 folks?

The logic applies more cleanly with student discounts, but it still works with the concessions. Basically, people who have extra utility left over after buying their movie ticket will apply some of it towards their popcorn purchase. They don't analyze the popcorn purchase as a completely separate transaction, but rather lump it in with the whole movie package.
9.28.2007 2:25am
American Psikhushka (mail) (www):
Alaska Jack-

I'll make an attempt at a trashy description of what the theaters are up to.

Popcorn and soda have become what is known as a "complementary good" to the movie, or the experience of watching the movie. This is similar to other complementary relationships - burger and fries, coffee and doughnuts, peanut butter and jelly, beer and watching sports, beer and hot wings, wine and cheese, etc. Some of the "Got milk?" ads highlighted this relationship by featuring ads with products that are complementary goods to milk - like chocolate cake. So while it is quite possible to watch a movie without popcorn and a soda, many people have so closely associated them with the experience of watching a movie that the experience seems incomplete without them. Because they have a somewhat "captive market" of moviegoers, they can charge pretty dearly to complete the experience. Just enough so that you won't start comparing concession prices and going to another theater. (Not like there's much difference in pricing concessions, I wonder if there is fixing going on.)

As far as candy goes I think they just charge as much as the customer will bear there as well. Usually someone in a couple or group is getting popcorn and/or a soda, which are harder to smuggle in, so they just increase candy prices as well hoping that people won't bother to smuggle candy in either.
9.28.2007 2:58am
V:
The captive market concept does NOT explain the pricing of popcorn. As the reference I noted above comments, theaters have captive markets in restrooms to, but you don't see pay toilets in every movie house. The question is not simply why the popcorn is priced "high" ("to maximize income") but why it's done that way and not other ways (like higher ticket prices and free popcorn). Landsburg himself provides a nice discussion (reference above) but later (see Slate.com article on internet access in hotels) points out that the same explanation doesn't work for Internet access (why do some hotels charge significantly for internet access while other hotels provide it "free"?), though the economic situation appears amazingly similar.
9.28.2007 3:39am
Tony Tutins (mail):
David Friedman's page o' links is indeed a good starting point for anyone who wants to understand why people have such strong feelings about Lott. Hopefully these feelings will not prejudice anyone against his current work.

Depending on what side of the gun rights divide you fall on, Lott's CCW analysis is either appealing or appalling. Those appalled by his conclusions will naturally try to find fault with them. Start by reading Prof. Friedman's observations; although staunchly libertarian he does not appear to have a dog in this fight. I do not know Ayers or Plassman's ideological bias, if any, but Lott's original critics were strongly in the gun control camp: e.g. Teret works at the Johns Hopkins Center for Gun Policy and Research, which is funded by the pro-gun control Joyce Foundation. Out of a natural cynicism, I suspect that any Hopkins research that produced a result like "more guns, less crime" would result in the drying up of Joyce funds.

Some of Prof. Friedman's links are dead, but the Ayers papers, at least, are googleable.

This illustrates a problem when advocates do research, the most extreme case being Bellesiles. Another recent example is Nadia Abu Al-Haj's applying for tenure and her archaeological work -- depending on your POV she is either appealing or appalling as well. Having her work evaluated by someone completely detached makes a lot of sense. In his own career, John Lott has had a series of short-time academic jobs, and I'd guess he's way too controversial to get a tenured academic job at this point.
9.28.2007 3:40am
John Lott (mail) (www):
Thanks, Todd, I greatly appreciate you taking the time to read the book and write the review.

The book relies on published academic articles that I have had. I have always and regularly made my data available to others when they have asked for it, which is not something that is regularly done by my critics.

As to the source that Dennis Todd points to, you might want to be aware the accuracy rate on his claims is nonexistent and that he has been accused by others of doctoring information. As to the survey that is discussed here, an extensive discussion of the evidence is provided here. I redid the survey in 2002 and that data has long been made available here.
9.28.2007 3:46am
Happyshooter:
I read his books and attended one of his lectures at Michigan. I was really impressed.

I am sorry he got into that internet board mess, I think it cost him a lot of cred.

Assuming the above poster really is Mr. Lott, your gun book really helped me at the Michigan Law School. The debate was in full swing then over what became the state's 'shall issue' law. Most of the arguments against at the school were nicely addressed by you.
9.28.2007 7:45am
J. F. Thomas (mail):
It's so wonderful that all of you are objecting to the ad hominum attacks on poor old defenseless John Lott. Then he comes in and drops an ad hominum attack himself. I am sure he is also preparing defamation suits to file as we speak too.
9.28.2007 12:14pm
frankcross (mail):
You think that David Friedman should sue for defamation? I suspect the accuracy rate on his claims is not actually zero.
9.28.2007 12:17pm
Tony Tutins (mail):
frankcross: probably Lott meant his internet sparring partner Tim Lambert.
9.28.2007 12:21pm
frankcross (mail):
Probably right. But I suspect Lambert's accuracy also is not entirely nonexistent.
9.28.2007 1:10pm
American Psikhushka (mail) (www):
V-

The captive market concept does NOT explain the pricing of popcorn. As the reference I noted above comments, theaters have captive markets in restrooms to, but you don't see pay toilets in every movie house. The question is not simply why the popcorn is priced "high" ("to maximize income") but why it's done that way and not other ways (like higher ticket prices and free popcorn). Landsburg himself provides a nice discussion (reference above) but later (see Slate.com article on internet access in hotels) points out that the same explanation doesn't work for Internet access (why do some hotels charge significantly for internet access while other hotels provide it "free"?), though the economic situation appears amazingly similar.

The "captive audience" concept was only part of my explanation. The main part was that concessions - mainly popcorn and soda - have become complementary goods to the movie watching experience. This isn't very different from other relationships that involve complementary or mutually necessary goods - like giving away or selling razors cheap but charging dearly for the blades, giving away cell phones but charging for airtime, etc. The relatively "low" ticket prices are the "hook" for the higher concession prices. As to why this is the way it is done, it could have just started that way and become a business practice - advertise "reasonable" ticket prices to get the audience in and then hit them with high concession prices. From what I have seen ticket prices are posted externally at the ticket window but concession prices are not.
9.28.2007 1:43pm
Hattio (mail):
Alaska Jack,
Can't offer the good economic explanations as some on here will do (and thanks, not my area but I find it interesting). But I can offer an explanation why folks down there in the Lower '48 don't wear their parkas into the movie theater. They tend not to be that conspicuous in AK (even in the summers, you know, those tourists who don't understand that 47 and rainy counts as summer). In contrast, in Miami, they are almost always conspicuous. There's obviously places, Chicago, Minneapolis, etc., where they are seasonally conspicuous.
9.28.2007 1:51pm
bigchris1313 (mail):
Odds on whether or not poster John Lott is actually John Lott?

3:1? 1:3?
9.28.2007 1:54pm
Tony Tutins (mail):
American Psikhushka: thanks for explaining this. Computer printers/cartridges follow the razor/blades pricing model, and certain toys follow the complementary goods model: barbie dolls/barbie clothes, and game consoles/video games.

I've noticed that when the price of concessions is too high, as at the ball game, people will start to tailgate -- a $1 beer outside is so much more appealing than an $8 beer inside. Saving money this way is not limited to the ball game: The younger people I know pregame by starting to get their drink on cheaply at home, buying only one or two high-priced drinks at the club. Perhaps movie fans will start tailgating in the theater parking lot -- gobbling popcorn and swilling coke before they go inside.
9.28.2007 1:57pm
uh clem (mail):
Odds on whether or not poster John Lott is actually John Lott?

They're pretty good. Academic blogs are a small enough world that it's unlikely that someone would be able to impersonate a noted character at length and get away with it. The person with this account stops by the comment threads regularly and has for quite some time. My previous interactions with him indicate that he's the genuine article.

I could be wrong, of course, but that'd be the smart way to bet.
9.28.2007 2:02pm
bigchris1313 (mail):

My previous interactions with him indicate that he's the genuine article.


Very good. Thank you.
9.28.2007 2:55pm
Stating the Obvious (mail):
American P: First, I don't have a dog in this fight. I was merely pointing out a nice source, Steven Landsburg's An Armchair Economist, for a discussion of popcorn pricing.

Second, I don't think your complementary goods argument is as strong as you think. Stadium seating could be looked at as a complementary good as well. Some theaters have stadium seating in some but not all of their multiplex movie rooms. But they don't charge once for the movie and again if you want to see it in a room with stadium seating.

Audio heatsets for the hard-of-hearing are complementary goods as well. To some, like popcorn, they are not worth much. To others, they add much enjoyment to the movie experience. Yet I've never seen a movie theater charge for this "extra". So I'm just saying there's more to it than first meets the eye.
9.28.2007 3:24pm
J. F. Thomas (mail):
Audio heatsets for the hard-of-hearing are complementary goods as well.

No they're not, they are mandated by the Americans with Disabilities Act, so theatres can't charge extra for them.

Oh and as for Lott, even if he did conduct the surveys, his figures on defensive use of firearms are still bogus because he neglects to consider the margin of error in his surveys. His reported rates of defensive gun use are within the margin of error, (and represent about the same percentage of the population who have been kidnapped by aliens or encountered Bigfoot) so his extrapolations are meaningless, and the conclusions he draws from it, meaningless.
9.28.2007 3:38pm
Alaska Jack (mail):
Hattio:


parkas ... tend not to be that conspicuous in AK ... In contrast, in Miami, they are almost always conspicuous.



Great point :^)

- Alaska Jack
9.28.2007 3:40pm
Tony Tutins (mail):
His reported rates of defensive gun use ... represent about the same percentage of the population who have been kidnapped by aliens or encountered Bigfoot

Except newspapers don't report when someone has been kidnapped by aliens or encountered Bigfoot. People's arguments are more persuasive when (a) they make one, and (b) they at least attempt to conceal their biases.

For example, Ayers does not inspire one with his good faith, by picking cutesy titles like Shooting Down the More Guns, Less Crime Hypothesis, and The Latest Misfires in Support of the More Guns, Less Crime Hypothesis
9.28.2007 3:54pm
Tim Lambert (mail) (www):
Oh, that comment is almost certainly from John Lott. I recognize the style, right down to refusing to mention my name. And it's pretty funny that his killer argument is that I've been "accused by others of doctoring information". Lott isn't even willing to endorse the accusation, perhaps because he knows it is untrue. The fellow Lott links to accuses me of

"adding (and posting on the web) a signature on a review to make the material (incorrectly) appear to be that of Lott; he then went forth to proclaim this doctored material showed Lott was reviewing his own work"


But if you check the links to Amazon in my post you see Lott's signature appears on the review there -- I certainly did not add it.

And Lott has never denied posting that review to Amazon -- he just evades the question if you ask him about it.

But this thread is about Freedomnomics. Todd Zywicki found that Lott's chapter on crime was very strong, so I suggest he checks whether the paper by Helland and Tabarrok, Advances in Economic Analysis and Policy, 2004 finds that concealed carry reduces violent crime as Lott claims in his book. I understand that Alex Tabarrok blogs at Marginal Revolution, so his email should be easy to find.
9.28.2007 3:57pm
J. F. Thomas (mail):
Except newspapers don't report when someone has been kidnapped by aliens or encountered Bigfoot

They don't report the levels of defensive gun use that Lott alleges his surveys prove either. He puts it down to media bias. I guess that is the same reason alien abductions and Bigfoot encounters don't get more press coverage either.
9.28.2007 4:19pm
J. F. Thomas (mail):
People's arguments are more persuasive when (a) they make one, and (b) they at least attempt to conceal their biases.

Lott's arguments (more guns, less crime) would be more persuasive if they were supported by actual facts instead of manipulated and selected use of data to support an unsupportable conclucsion. Just look at the violent crime rates in this country and they contradict his central argument. Granted, they do not support the opposite contention either (less guns, less crime), but his original contention has been thoroughly discredited.
9.28.2007 4:26pm
J. F. Thomas (mail):
People's arguments are more persuasive when (a) they make one, and (b) they at least attempt to conceal their biases.

Lott's arguments (more guns, less crime) would be more persuasive if they were supported by actual facts instead of manipulated and selected use of data to support an unsupportable conclucsion. Just look at the violent crime rates in this country and they contradict his central argument. Granted, they do not support the opposite contention either (less guns, less crime), but his original contention has been thoroughly discredited.
9.28.2007 4:26pm
Tony Tutins (mail):
According to the Department of Justice, homicide rates have fallen to levels not seen since the 60s, when the Gun Control Act of 1968 was passed.
9.28.2007 5:11pm
frankcross (mail):
Reportedly because of abortion, Tony Tutins. They've fallen dramatically in cities without concealed carry laws. I think the point is that it is extremely difficult to extract the causes of crime levels. The quantitative magnitude of John Lott's effect is not that great. I'm just afraid that the data do not allow for enough controls to be sure of anything beyond: More guns aren't really bad for crime. I think the data permit that conclusion.
9.28.2007 5:18pm
David M. Nieporent (www):
Landsburg himself provides a nice discussion (reference above) but later (see Slate.com article on internet access in hotels) points out that the same explanation doesn't work for Internet access (why do some hotels charge significantly for internet access while other hotels provide it "free"?), though the economic situation appears amazingly similar.
He addresses and explains that in Armchair Economist, too.
9.28.2007 5:26pm
Naaman Brown (mail):
As I recall, McCollough and Vinod (JEL June 1999 Numerical Reliablity of Econometric Software) addressed the issue of replication in the economic science, noting that only four journals in the field required authors to provide data or code so others could test their published results. From the beginning, John Lott has made both his data and his code available for downloading, to friend and foe alike, often before publication. If Lott actually were manipulating data to reach a predetermined conclusion, it would be very odd to make his data and code freely available to anyone who wanted to test it. As far as the 2%98% stat goes, Laurence Southwick got 59,000 defensive gun uses with shots fired, Gary Kleck got 2.4 million total DGUs and Cook &Ludwig NSPOF projected 4.7 million DGUs: 59,000 / 2,400,000 = ~ 0.02483
so I don't think Lott's 2% to 5% DGU is at all unreasonable: all DGUs known to me personally have been chase-offs.
9.28.2007 5:55pm
Tony Tutins (mail):
DMN: The two types of hotels have different markets, which differ in their willingness to spend money. In my experience, the hotels that charge for internet access cater to corporate travelers whose expenses are reimbursed, while the "free" internet hotels cater to people who are paying for their own travel. Cheaper hotels are also more likely to provide a full slate of cable TV channels, along with free coffee, juice, and rolls in the morning; while the business hotel has only the networks, hbo, cnn, and espn, along with room service featuring the $12 continental breakfast.
9.28.2007 6:00pm
Naaman Brown (mail):
Oh, by the way, surveys estimating DGU per year run the range fron 100,000 per year to 23 million per year, with several surveys in the 740,000 to 3.6 million range. Lott's claim of 2.1 million per year is rather modest.
9.28.2007 6:02pm
frankcross (mail):
Naaman, if the effect were that large, shouldn't it show up more dramatically in the crime rates?
9.28.2007 6:04pm
Tony Tutins (mail):
Naaman and JFT: True from what I've seen that if a "defensive gun use" makes the newspaper, it's almost always because the user has put a bullet into an aggressor.
9.28.2007 6:05pm
Andy Freeman (mail):
Before Lott, it was generally believed that shall-issue CCW was guaranteed to increase crime and the only question was how big a disaster it would be.

The most extreme of Lott's critics are arguing that there may be an increase which is observable.

In a society that valued choice, that result would be taken as support for shall-issue CCW.
9.28.2007 6:07pm
John Lott (mail) (www):
J. F. Thomas

"even if he did conduct the surveys, his figures on defensive use of firearms are still bogus because he neglects to consider the margin of error in his surveys."


In the sentence where this number was used in More Guns, Less Crime, I used a number that was biased against the claim that I was making. The point of the paragraph was to explain why many defensive gun uses were not newsworthy and thus it was understandable why the media didn't cover them. Defensive gun uses that do not result in the death or injury of the criminal are not particularly newsworthy and thus the greater percentage of defensive gun uses that do not result in death or injury, the greater the justification for the media not covering most defensive gun uses. I believe that there is media bias generally against guns, but the point was the vast majority of newsworthiness decisions do not involve evidence of bias. If I had wanted to use this number to claim media bias, I could easily have picked one of the couple other estimates over the previous 20 years that showed somewhat lower rates of brandishings and warning shots. The point was that the number that I picked was picked because it was biased against my claim.

J. F. Thomas

"Lott's arguments (more guns, less crime) would be more persuasive if they were supported by actual facts instead of manipulated and selected use of data to support an unsupportable conclucsion."


I have used all the crime data that has been available when I have done my studies. 1977 was the first year that county level crime data was available. I used data up until the last year that it was available, and I used the data for all 3,140 counties. Most of the studies find results similar to or larger than what I found. For some see here. I have used more control variables than any other study. For example, why don't any of my critics use all the other gun control law variables that I have supplied or put anything about these other laws together on their own?
9.28.2007 6:24pm
frankcross (mail):
I think Tony Tutins is right about press coverage. But that has been studied to suggest that the surveys of DGU are vastly exaggerated. I remember one Arizona study that found that the DGUs that resulted in firearm injuries (based on police reports and press coverage) were only about 1% of the number of such events reported in the surveys.
9.28.2007 6:55pm
Naaman Brown (mail):
When Texas first passed its "shall-issue" law, a district attorney stated publicly that the county morgue would have to add a new floor to handle all the new murders brought about by more guns on streets; ten years later, he admitted "Boy, was I wrong." The right to carry law worked out better than he expected. There was not the blood bath feared and predicted by the opponents. The strongly held assumption (based on intuition, surmise and speculation) was the opposite; and if that a-priori assumption on gun control was wrong, how many others are also false?

James Wright and Peter Rossi analysed a survey of felons for the NIJ that was published by Aldine in the mid-1980s. If I recall correctly (I am using my grandson's laptop and do not have access to my archives) that involve 1874 convicts in 18 prisons in ten states. The thing felons feared most (more than arrest or conviction) was an armed victim. The point is, the effect of DGU on the crime rate would only show up if the "gun free environment" goal were achieved, totally removing any deterrent effect of the armed citizen. For a report on that, see Joyce Lee Malcolm's second book on England.
9.28.2007 6:55pm
Tim Lambert (mail) (www):
Naaman Brown says

As far as the 2%98% stat goes, Laurence Southwick got 59,000 defensive gun uses with shots fired, Gary Kleck got 2.4 million total DGUs and Cook &Ludwig NSPOF projected 4.7 million DGUs: 59,000 / 2,400,000 = ~ 0.02483

Southwick did not get 59,000 DGUs with shots fired. He got 59,000 DGUs per year in total from NCVS data for 1979-1987. He did not give a number for the percentage with shots fired, but for NCVS 1987-90 it was 28%. For Kleck it was 24% and for NSPOF it was 27%. See here .

The only surveys that supposedly give numbers like Lott's are the alleged 1997 survey -- but it is mathematically impossible for it to give that result (what percentage is 2/28?) and the 2002 survey, which simply does not give the result he claims (is 1/13 equal to 5%?).
9.28.2007 7:02pm
Tim Lambert (mail) (www):
Lott says

In the sentence where this number was used in More Guns, Less Crime, I used a number that was biased against the claim that I was making. The point of the paragraph was to explain why many defensive gun uses were not newsworthy and thus it was understandable why the media didn't cover them.


Actually, the claim that Lott was making in More Guns, Less Crime was that "underreporting of defensive gun use is large". The extraordinarily high brandishing rates that Lott claims his surveys found are biased TOWARDS this claim. The lack of news coverage can be explained if defensive gun use is not as frequent as Lott claims and as the National Crime Victimization Survey indicates.
9.28.2007 7:06pm
33yearprof:
Just the facts.

STATE: Florida
Duration of law: 20 years
Carry licenses issued: 1,274,356
Licenses revoked for ANY crime after licensure: 3,311
Licenses revoked for GUN-RELATED crime after licensure: 162

162! That makes permit holders among the least likely people to misuse firearms in a crime.

It surely provides NO SUPPORT WHATSOEVER for the "sky is falling" crowd. And NONE for John Lott's critics.

As they say in law school, "When the facts and law are against you, attack the opposing lawyer."

http://licgweb.doacs.state.fl.us/stats/cw_monthly.html
9.28.2007 7:06pm
Tony Tutins (mail):
Tim L -- the newsworthiness of an event depends on the size of the community and the number and magnitude of other events. The Carmel Pine Cone is the only paper I know of that publishes the entire police blotter.
9.28.2007 7:21pm
Naaman Brown (mail):
LUCKILY i had an backup on my wife's work computer of
St. Louis University Public Law Review
Gun Control Symposium
vol 18, no. 1, 1999: 217
GUNS AND JUSTIFIABLE HOMICIDE:
DETERRENCE AND DEFENSE
Lawrence Southwick, Jr.
on page 13, his 59,000 figures is an estimate of shooting DGUs, read the article, page 13 and 59,000 has nothing to do with the NCVS survey data (NCVS is a measure of: Were you a victim of a crime? if yes, did you resist? if yes, did you use a gun? The NCVS figure is UNSUCCESSFUL DGUs)
9.28.2007 7:33pm
Naaman Brown (mail):
And Gary Kleck himself warned that the 24% from recollection of the small sample of positive DGU respondents to the NSDS survey was not statistically sound.

~200 positive DGU respondents from a survey of ~5000 can give an indication of the number of DGUs, but ~200 is not large enough for a national sample on details about DGU.
9.28.2007 7:40pm
John Lott (mail) (www):
Naaman Brown is correct. As people who work with this data understand, the problem with using the NCVS for a measure defensive gun uses is that you first have to answer a question saying that you were a victim of a violent crime before you are asked any questions that allow you to say that you have used a gun defensively. The problem is that many people who used a gun defensively may have used it so that they were not a victim and may not view themselves as having been a victim.

For those who are confused, there is a difference between defensive gun use rates and the rate that those defensive gun uses actually harm the criminal is important. An earlier post confuses those two issues.
9.28.2007 7:44pm
Naaman Brown (mail):
Of the vetted 19 positive DGU respondents to NSPOF, Cook and Ludwig were puzzled that six did not consider themselves victims of a crime. People who successfully defend themselves (and I know five women who successfully defended themselves with guns) tend not to think of themselves as victims.

And if ~200 of NSDS respondents were not a good national sample for details on DGU, the 45 raw and 19 vetted DGU respondents of NSPOF is even tinier. A valid national sample would require at least 600 positive respondents according to Kleck. Or the method used in the Southwick paper I cited above.
9.28.2007 7:56pm
frankcross (mail):
There's nothing wrong with survey data, but it's not the most reliable. The study I was referring to examined DGUs in Phoenix that looked for killings or woundings. This is a small percentage of the reported DGUs, but the Kleck &Gertz article projected that there would be 98 of these during the place and period studied and there were only 8. The apparent inaccuracy of this subset would call into question the broader sample, I think. Though 8-10% of those numbers is still material DGU value, I guess.
9.28.2007 8:07pm
Tim Lambert (mail) (www):
Ahh, you're looking at a different paper. The 59,000 number comes from taking the FBI number of justifiable homicides and dividing by a guess for the fraction of such homicides are recorded by the FBI, then by a guess for the death rate from gun shot wounds, and then by a guess for the hit rate. The resulting number is more of a guess than anything else. In any case it is utterly wrong to divide it by Kleck's number for DGUs when and ignore what Kleck for for fired gun.

Kleck did not warn that the 24% was not statistically sound because 200 was too small a sample. Have you actually read his paper? The general rule of thumb is that you need a sample size of 30 before you can find anything useful. So Kleck's 200 was OK, but the 7 DGU respondents that Lott found in his 2002 survey is too small and Lott cannot validly claim that this survey confirms anything.
9.28.2007 8:08pm
Alaska Jack (mail):
OK, so there's one thing we can all agree on: The price of movie popcorn is too high.

- Alaska Jack
9.28.2007 8:25pm
J. F. Thomas (mail):
I have used all the crime data that has been available when I have done my studies. 1977 was the first year that county level crime data was available. I used data up until the last year that it was available, and I used the data for all 3,140 counties.

Then explain New York City's crime rate or the fact that New Orleans has the highest murder rate in the country or that the murder rate in Dallas and Chicago (one city with very liberal gun laws, the other with very strict) are roughly the same.
9.29.2007 12:34am
J. F. Thomas (mail):
The problem is that many people who used a gun defensively may have used it so that they were not a victim and may not view themselves as having been a victim.

The problem is that the same number of people you found who claimed they had used a gun defensively is about the same number of people, who if asked, would say they saw Bigfoot or were abducted by aliens. That is why any serious unbiased researcher will throw out 2-3% of his survey results, because 2-3% of the population are pathological liars, insane, or just make shit up to please the interviewer. So all your DGU data is worthless, and if you were honest, you would admit it.
9.29.2007 12:43am
Kevin P. (mail):
J. F. Thomas:

...
because 2-3% of the population are pathological liars, insane, or just make shit up

Is this really true? Regular readers of the Conspiracy, do you know any such person?
9.29.2007 2:09am
Kevin P. (mail):
On a more serious note:
J. F. Thomas:

The problem is that the same number of people you found who claimed they had used a gun defensively is about the same number of people, who if asked, would say they saw Bigfoot or were abducted by aliens. That is why any serious unbiased researcher will throw out 2-3% of his survey results, because 2-3% of the population are pathological liars, insane, or just make shit up to please the interviewer. So all your DGU data is worthless, and if you were honest, you would admit it.

So to follow your logic, gay people likely don't exist, because they are surveyed to be in the population in the same general range (under 5%). Since 2-3% of the population just make s*** up, you are saying that we can assume that data on gay people is worthless. Maybe Ahmedinajad was onto something.
9.29.2007 2:13am
Kevin P. (mail):
For readers new to this subject, I would like to make a plug for two web sites that track news reports of defensive gun uses:

Operation Self Defense

Civilian Gun Self-Defense Blog

Most of these news reports involve defensive shootings where an assailant got shot and hurt. I would not be surprised if there are many more brandishings where the criminal makes a hasty exit and the incident (reasonably) does not make the news, or even reaches the police.
9.29.2007 2:19am
Tony Tutins (mail):
jft -- I'd be interested in seeing your Bigfoot/alien abduction data.
9.29.2007 2:19am
Kevin P. (mail):
Tony Tutins:

For example, Ayers does not inspire one with his good faith, by picking cutesy titles like Shooting Down the More Guns, Less Crime Hypothesis, and The Latest Misfires in Support of the More Guns, Less Crime Hypothesis

Not to mention gems like this one (From page 109 of Shooting Down the More Guns, Less Crime Hypothesis, page 10 in the PDF):

As an earlier president of the Connecticut Chiefs of Police Association once stated, "We are concerned about the increasing availability of handguns and the ease with which a person can get a pistol permit. [A] permit is dangerous in the hands of a neophyte who goes to a bar and shows off his phallic symbol to the boys."

and page 148:

In a world where NRA members have bumper stickers stating "Keep Honking, I'm Reloading," the costs of intimidation of law-abiding citizens may become intolerable.


It is strange that Ayers and Donohue would spend so much time on this research and destroy their perception of credibility with this loose talk.
9.29.2007 2:44am
Tim Lambert (mail) (www):
It's strange that Kevin P thinks that cutesy titles destroys Ayres and Donohue's credibility, but Mary Rosh and fabricating a survey and fabricating the results of another survey does not affect Lott's credibility.
9.29.2007 11:07am
Kevin P. (mail):
Tim Lambert:

It's strange that Kevin P thinks that cutesy titles destroys Ayres and Donohue's credibility, but Mary Rosh and fabricating a survey and fabricating the results of another survey does not affect Lott's credibility.

Of course, Tim, you actually have no idea what I think of Lott's credibility, but don't let that prevent you from making stuff up. Feel free to conflate other commenters' opinions with my own.

And I should point out that "phallic symbols" is not a "cutesy title". It is part of the argument inside the paper. Please consider reading it - I provided the link and page numbers.
9.29.2007 11:14am
Tony Tutins (mail):
The police chief's quote speaks worlds about his own motivation to be a cop: one of the few jobs that allows one to carry a phallus firearm around all day.

The ability to be armed on the job is valuable: The worker most likely to be killed by another is not a police officer, but a cab driver.
9.29.2007 11:43am
J. F. Thomas (mail):
I'd be interested in seeing your Bigfoot/alien abduction data.

From Wikipedia:

In 1991, Hopkins, Jacobs and sociologist Dr. Ron Westrum commissioned a Roper Poll in order to determine how many Americans might have experienced the abduction phenomenon. Of nearly 6,000 Americans, 119 answered in a way that Hopkins et al interpreted as supporting their ET interpretation of the abduction phenomenon.


So they actually had a larger sample size than John Lott and found about the same incidence of alien abductions as purported DGU. Just think if those poor abductees had been armed, they could have bagged themselves an alien.

Another thing about Lott's research. He has never shown that shall issue or relaxed concealed carry laws actually lead to a higher rate of citizen concealed carry. It is just as reasonable to assume that it merely encourages people who were already carrying firearms to legitimate their actions and doesn't actually mean more people carry weapons because it is now legal to do so.
9.29.2007 6:33pm
David M. Nieporent (www):
So they actually had a larger sample size than John Lott and found about the same incidence of alien abductions as purported DGU.
No, they didn't. They found about the same incidence of people answering in "a way that Hopkins et al interpreted as supporting their ET interpretation of the abduction phenomenon."
9.30.2007 4:42am
Toby:
I'm surprised that no one had broached the subject that a substantial portion of the "complementary value" of concession purchases is extracted (or it is hoped will be extracted) outside of the theater. Theaters align with courtship. Concession purchases can be used to cover up awkward silences (Want some more popcorn) and to inform the object of desire of one's generosity and economic fitness. If the purchaser of the concessions acquiring his (probably) short term tactical goals for an additional $10-20, than they have been purchased at below market rates. If they assist in achieving longer term strategic goals, the investment/reward ratio is even better.

If you add the parent who has been off on a business trip at a Saturday matinee, or even better (for higher pricing) the non-custodial parent at that same matinee, then the benefits being purchased have little to do with the innate value and market prices of the goods.

When you see something that does not fit in an economic model, you may well be ignoring something that you consider an externality that is in fact not an externality.
9.30.2007 1:08pm
Tony Tutins (mail):
Concession purchases can be used ... to inform the object of desire of one's generosity and economic fitness.

This is not a good long run strategy for the theater. The time of demonstrating this is a transient phenomenon only, yet the high prices occur during the steady-state relationship as well. Soon enough, the object of desire starts thinking of "your money" as "our money," and decides it could be better spent on goods other than popcorn.

The result is, before long, your ood suggests you stay in and pop your own corn while watching Netflix.
9.30.2007 2:45pm
David W. Hess (mail):
Alaska Jack (mail):
It reminded me of something that puzzled me. Everyone knows how expensive the popcorn, candy etc. is in a movie theater. The common explanation I've heard for this is that theaters don't make much from the movies themselves, so they have to make up the difference via the concessions.

In my experience this is largely if not exclusively the case. I had a good friend who was a projectionist for Edwards in Southern California. Besides the occasional after hour showing and helping him maintain the projectors, I learned a little about the financial arrangements that theaters have to make. For major films, the distributor receives a percentage of the ticket price (declining over a time period of weeks) set by the theater and for very popular movies, this percentage is above 100 percent so the theater pays more then the ticket price for the film. One thing we never did after hours was take soda or candy. They were VERY careful about inventory control which in the case of sodas involved counting the cups. This was never a problem of course since being after hours we just brought our own food.
10.1.2007 12:30pm
garhane (mail):
I think there is a sort of theory, perhaps just a practical observation in the field of money, that a bad penny keeps turning up. It certainly shows up here, does it not. How can a fellow who has been as thoroughly striped of credit as this one get published, have the nerve to show up in print, receive favorable comment from some people who do not immediately sound like cult followers. And here is a review in this blog that treats him as a serious writer without mentioning his past and present. It is like an account of the flat earth society without mentioning that abundant evidence repudiates their claims. What next? A puff piece on Creationism and its many successes? Surely this blog has a greater purpose than dredging up the undead.
10.2.2007 1:45am
Naaman Brown (mail):
If anyone cares, I did not carry concealed in public until after I got my permit to carry, and I know others who refrained from carry. The only answer to the question of whether carry permits increased the number of people actually carrying might be an anonymous poll of permit holders, but gun control is an issue where the antigun folks prefer to support their a priori assumptions through surmise and speculation.

I know of four incidents were women I know defended themselves with guns resulting in chase-offs without shots fired. So Defensive Gun Use does happen and the vast majority are no shots fired. To pretend otherwise is acting far more like the Flat Earth Society than recognising it as fact.
10.2.2007 1:18pm