The ESA has generated some cool but disturbing pictures of space junk:

More here. It’s a great example of what happens to a common resource when it can be used by anyone and is owned by no one.

A blog called MeatyREADS responded to my critical post about EcoLibris in this way:

This is why people dislike economists. You take what seems to be a perfectly nice company and then point out how the incentives are all wrong.

But … by pointing out that the incentives are wrong, I’m trying to make the world a better place. Increase efficiency and all that. Why would you dislike me for that? I’m trying to give you a free lunch!

This made me think a bit about why the public often has a negative perception of economists. I blame the media.

Tim Harford points to an interesting discussion of how “short-termism” can affect your behaviour. Basically, when making choices about what to do right now, it seems we often choose the thing that gives instant gratification, even if it’s not the most beneficial for us in the long run. When making choices about future plans, we’re more likely to choose the thing that’s “better for us”. His illustration is an experiment which showed that given choice between fruit and chocolate right now, most people tend to choose the chocolate. However if the reward is promised for one week in the future, people tend to choose the fruit.

The post Harford links to discusses the implications of this for online news. The internet relaxes a lot of constraints, and one of them is the necessity to bundle “hard news” with celebrity gossip and other trivial things in paper newspapers. These are unbundled online — just click the one that you want. As a result of relaxing this constraint, plus people’s propensity to go for the instant gratification, people tend to read more celebrity gossip and less hard news. This might give short-term happiness, but it’s not necessarily what people might want in the long-run.

To put it another way, think about how you would plan to spend your time next week. I guess you may not allocate a lot of time to reading celebrity gossip. However, when next week really comes, and that gossip is just a click away, it’s very tempting to read it. You get a little short-term happiness, but it’s not what you wanted when you made your plan. The plan not to read gossip is not subgame perfect in the game between current-you and one-week-in-the-future-you.

A basic principle here is that constraints can be valuable. People can be willing to pay for them, as StickK illustrates. The Internet gives us a lot of freedom to choose, but maybe people would be happy to have less freedom, fewer choices. Perhaps there’s a market for the ultimate “net nanny” software, which places hard limits on the amount of time that you spend on frivolous online activities?

I just read this bizarre story about a flight from Australia to New Zealand where, after the passengers had boarded, a cabin crew member became ill, and the flight needed to lose 13 passengers before it could take off (safety regulations mean you have to have at least a certain ratio of crew to passengers). Apparently there was a lot of trouble encouraging people to get off, as it doesn’t seem that much incentive was given, and the airline resorted to bullying tactics.

Some people reluctantly got off after they were offered a free flight in future, but if I were the captain of the plane I would have conducted an auction … The only question would be whether to sell the right to stay on the flight or pay people to get off. From an efficiency point of view it doesn’t matter, as long as the required number of people get off. But I guess from a PR point of view it would be better to pay people to get off. With 90 passengers in the auction, the amount the airline would have to pay to get people off probably wouldn’t be too high.

This paper (via Paul Kedrosky) examines people’s gym attendance. One of the main findings:

Members who choose a contract with a flat monthly fee of over $70 attend on average 4.8 times per month. They pay a price per expected visit of more than $17, even though a $10-per-visit fee is also available. On average, these users forgo savings of $700 during their membership.

As I’ve said before, I really think there’s money to be made in a “StickK” type gym plan that charges you a big fee up front and then pays a bit of it back to you every time you go and work out. I wonder if I can patent this idea and sell it to gyms …

(HT: Felix Salmon)