The Upside of Waiting in Line
20th February 2015
Tyler Cowen makes some lemonade.
The next time you are waiting in line, take consolation in the fact that otherwise you might not have heard of the opportunity in the first place. If we see a line at a club, restaurant or movie, we figure something interesting is going on there, and so lines have become a driver of publicity.
Income inequality also may be encouraging sellers to use lines to better segment the market. The rich line-jump by buying Museum of Modern Art memberships, to see special exhibits before they open, while others line up. Restaurateurs give regular customers prime tables, especially if they are good tippers and order expensive wines, while others can’t get a reservation after 5:30 or before 11 p.m. This may seem unfair, but it extracts higher prices from those able to pay the most for New York’s cultural institutions and restaurants. In fact, the inconvenience of the line helps sell the more expensive line-jumping package to those who don’t have the time or the patience to wait.