Marginal Utility

by Ken Houghton

1. Barron's, via Felix Salmon:
   

   As a retail-industry laggard with tired locations and mediocre merchandising, Sears figures to suffer mightily if consumers retrench and the economy slows, they insist.

   
   English translation: people know where their stores are, so they won't go there.
   
   This, one presumes, is why the accompanying graphic declares that Sears is "A Screaming Bargain: The implied value of Sears' retail real estate is absurdly low relative to competitors' property."
   
   
2. Because Everyone Cares about the Green, not the Yellow, Jersey:
   

   And for the first time since 1967, the race will start with a full road stage, 121 miles from Brest to Plumelec in Brittany, instead of an opening individual time-trial race against the clock that had become traditional. The goal is to give more riders, and not just time-trial experts, the chance to compete for the race lead and its coveted yellow jersey from the very start.

   
   Right; because a pack sprint and a Tom Boonen victory will definitely be something New and Unusual for the first week of the tour.
   
   Continuing with Press Release "Reporting":
   

   After the drug problems of the past two Tours, [there will be] 19 major mountain passes that riders will face, two fewer than in this year's race.

   
   Because mountains are never interesting television, and climbing video (not to mention those 70mph descents) are boring.
   

   "The idea was really to break the classic scenarios," Tour director Christian Prudhomme said. "I am convinced that cycling will rediscover its romanticism that made it a legend."

   
   I'm convinced that the Tour de France just moved to a lower Utility Curve.
   
   
3. Via Felix again, a Milken Institute report indicating that Congestion Pricing Works [PDF] —but so far has required an autarch to be implemented successfully.
   

   In the case of London, Mayor Ken Livingston was determined to introduce congestion charging and made it part of his platform in 2000. The act restoring the mayoral form of government to London after more than two centuries also gave him powers to introduce congestion charging without consent from the national government....
   
   Later on, the public indirectly endorsed the plan, re-electing Livingston a year after congestion pricing was introduced. There were no U-turns at the local
   government level at any point.
   
   Singapore has been run by the People’s Action Party since it first won an election in
   1959. As the ruling party, it has dominated most of the political and economic development of Singapore....Thus, it is not surprising that once the decision was made to charge for road use, there was little dissent. [emphasis mine]

   
   The most encouraging part of that, from NYC's point of view, is bolded above. Londoners voted for a man who promised to deal with congestion by setting a charge for externalities, and he did. And they re-elected him.

Especially in the context of that last, there has been a lot of straw-man idiocy recently alleging the superior "efficiency" of the private sector. But, as has been noted frequently, if you assume a functional democratic republic, there is a clear process in place for improving efficiency, one dependent only on the will of slightly over 50% of the people being realised.* That mechanism in the private sector (Shareholder meetings) is, at best, even less responsive.**



*I will freely stipulate that this is more true of an actual democracy than a democratic republic such as the United States. Overall, though, for a population of 300MM+, both (1) the benefits outweigh the risk and (2) that is the process.

**Oh, right, in Masonomics, you blame the victims.

Labels: bicycle racing, congestion pricing, conspicuous consumption, rational expectations, sports