Our correspondent Mike Pesca, had a nice story on this week about an auction for football seats which looks like a sweet deal for taxpayers.

As the story explains, the auction is a classic example of what economists call price discrimination.

The idea is to charge everyone as much as they are willing to pay. So say you are Starbucks...

and you know some customers are willing to pay $10 for a cup. How could you charge them $10, while charging more thrifty folks a lower price?

Tim Harford has the answer in the first chapter of his book Undercover Economist here.

Pesca's World Series coverage, by the way, has been uncommonly funny.

categories: Fun With Economics

3:00 - October 24, 2008

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