The road less travelled

Suppose there are two roads between two points. One road is free to use, the other has a toll. The one with the toll will, of course, be less crowded. So road users can travel for free, or they can pay extra to get there quicker.

The interesting thing is that this works regardless of the other differences between the roads. The toll road might actually be wider or narrower, longer or shorter than the free one. But as long as the roads are sufficiently busy, the journey will always be quicker on the toll road.

I was thinking about applying this idea to supermarket queues. Supermarkets could set aside one or two checkout lanes that have a charge of $1 to use. If you’re in a hurry, you can pay the extra money; the queue will always be shorter.

This is a nice application of free-market principles: in the supermarket example, the speed advantage of the $1 lane will in the long run be whatever the market values as $1 worth of time. This is the kind of narrow, specific, unimportant situation where free-market principles really work. It’s funny (annoying, sad) that people think the free market is a panacea rather than a useful idea. The statistician George Box pointed out that “all models are wrong, but some are useful”. The free market idea may be useful in some contexts, but it’s still just a model.

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