There was a study (referenced from a few books -- never read the study itself) where parents were required to pay if they didn't pick up their children from the kindergarten. Since setting this up reduced guilt (they were now paying for the care-takers' extra time) the average time of being late actually increased -- instead of decreasing as thought initially.
Freakonomics mentioned this. It took place in Israel. It took a social faux pax and converted it to an economic transaction, thereby reducing/removing the stigma of being late.
Which is great! The daycare discovered a lucrative business growth opportunity that help improve their customers' lives. Next step shout be to set a fair price for being late, so caregivers and parents can make mutually beneficial exchanges of time for money. Social mores are crude heuristics. Explicit prices can do better.
I would not say great. I would say it’s useful and efficient in some circumstances, and unhelpful in others. There are some things that don’t scale, and social moores might act as a safety valve in those cases versus an economic transaction.
Some human interactions are only a few A/B tests away from turning into a Black Mirror episode.
> Social mores are crude heuristics. Explicit prices can do better.
Social mores are actually huge efficiency boosters for humans. They remove the overhead associated with coordination, transactions and ensuring trust.
I understand that a lot of these don't scale to cities of millions and civilizations of billions, but some do, and we shouldn't be quick to replace them with the "newest and shiniest" (essentially replicating them at scale by burning energy).
I generally endorse this kind of reasoning but you should keep in mind that this doesn't work in part because a lot (probably most) don't generally endorse it too.
In the case of the daycare, the price wasn't intended to encourage parents being late at all. The actual price the daycare workers would probably want to charge is not a market clearing price, but a price so high the market doesn't clear. They probably felt trapped into haggling once they put any price on the practice at all.
> The daycare discovered a lucrative business growth opportunity that help improve their customers' lives.
"Staying open later and charging your customers for the service they receive during that time" isn't exactly a business secret. It also can be detrimental to the quality of life of the employees that are unsure of when exactly they'll be able to end their shifts.
That experiment could be fixed by penalizing every m minutes you're late with m*(1 + r) minutes of charity work, with r as the interest, at some point where the penalty has accumulated to some practical amount.
The economic premise of the kindergarten is already that parents would rather pay money than spend time with their kids.
