Wednesday, September 19, 2007

How much is that room?

At the Embassy Suites where I'm staying, the card on the back of the door lists a room rate of $399 per day, $2793 per week, and $12369 per month for one person or two persons. Slightly more for 3 and 4 persons. In case you're wondering, $12469 is $399x31. I'm not paying that much per day for my stay.

California requires that these rates be posted.

California Civil Code Section 1863
(a) Every keeper of a hotel, inn, boardinghouse or lodginghouse, shall post in a conspicuous place in the office or public room, and in every bedroom of said hotel, boardinghouse, inn, or lodginghouse, a printed copy of this section, and a statement of rate or range of rates by the day for lodging.

(b) No charge or sum shall be collected or received for any greater sum than is specified in subdivision (a). For any violation of this subdivision, the offender shall forfeit to the injured party one hundred dollars ($100) or three times the amount of the sum charged in excess of what he is entitled to, whichever is greater. There shall be no forfeiture under this subdivision unless notice be given of the overcharge to such keeper within 30 days after payment of such charges and such keeper shall fail or refuse to make proper adjustment of such overcharge.

Apparently this is the (anti-free market) anti-gouging law for hotel keepers.

Tuesday, September 18, 2007

For whom the bells toll (taxpayers)

bell marker for Historic El Camino Real

When I saw these markers on the side of the road, I just knew that somehow, there was taxpayer money wrapped up in this whole thing...

The story starts out well enough: it looks like California women paid for the first bells, and AAA took over later. But why am I not surprised: in 1974 the California Legislature decided Caltrans should pay to maintain and replace the bells, and in 2000 Caltrans was awarded a federal grant (i.e. money from taxpayers in Rhode Island, Texas, Minnesota, etc) to add more bells. I hope the people in Nebraska appreciate our set of bells spaced every mile or two.

Read more about the El Camino Real.

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Sunday, September 16, 2007

Do you promise?

I googled for "sunk costs" and came across an argument by Robert Bass of Coastal Carolina University that it's sometimes rational to honor sunk costs. He says that economic theory is incomplete because of these cases. He gives an example: let's say you make a promise, and later realize you'll see greater benefits by breaking the promise. Should you honor that sunk cost and keep the promise, or break the promise? Bass says it's beneficial to be considered a promise-keeper, so it can be rational to keep the promise because of that benefit.

If I'm reading his argument right, I think he's wrong. There's nothing wrong with economic theory -- it's right and rational to ignore sunk costs. Assuming a right and rational world. Humans aren't always right and rational. Making promises is not rational.

So how do I answer his argument that there's cases when you should consider sunk costs? That it's irrational to assume that humans are rational. Back to the promise-keeper -- it's beneficial for me to make a deal with a promise-keeper. It minimizes risk to deal with a promise-keeper. Wanting to deal with a promise-keeper is rational. You're banking on his irrationality.

On a planet of robots, no one makes promises.

Saturday, September 15, 2007


Ten High and Kessler whiskeys
Kessler blended whiskey is pretty good, but I still think I prefer my Ten High bourbon whiskey.