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Posts Tagged ‘marginal utility’

When It Comes to Awards

A friend of mine received three prestigious academic awards in the same year.  I asked him, “Wouldn’t you have been happier getting them in separate years? After all, the marginal utility of an award probably is decreasing within a particular period of time. So wouldn’t getting these awards in separate years have increased your lifetime utility?” 

He said that my observation was probably correct.  However, he was so surprised to receive even one of them, and the increase in his happiness was so great, that he just wasn’t able to think in this narrow economic way. I guess there are occasions (probably very few!) where even simple economics isn’t 100 percent relevant.

When Is a Negative a Positive? (Ep. 117)

Our latest Freakonomics Radio on Marketplace podcast is called “When Is a Negative a Positive?”  (You can download/subscribe at iTunes, get the RSS feed, listen via the media player above, or read the transcript below.)

So when is a negative a positive? When the negative is feedback. We focus on a clever research project by Ayelet Fishbach of the University of Chicago and Stacey Finkelstein at Columbia. It argues that positive feedback certainly has its role — especially when someone isn’t yet fully invested in a new project or job — but if it’s improvement you’re after, then going negative is where it’s at:

FISHBACH: The more a person is committed to a goal — and by that I mean the more someone thinks that they absolutely have to do it, they like doing it, it’s important for them to do it — the more negative compared with positive feedback will be efficient.

Does the McRib "Pork Price" Theory Make Any Sense?

The McRib is the Brigadoon of the food world, and inspires similar passion. Consider Willy Staley‘s long and entertaining report at the Awl, which wonders if the McRib’s very occasional appearances are related to low pork prices. Dan Hamermesh found this line of thinking sensible too.

But … really? Aside from the fact that the correlation between McRib reintroductions and pork prices isn’t very robust, I always wondered if a firm of McDonald’s size could be so nimble as to strike fast on something like this. In the comments on Hamermesh’s post, a reader named Jeff Birschbach tells us what he knows: