The University of California finding suggests employers have more to lose than to gain from publicizing salaries. Inexpensive workers might leave and costly ones aren’t made more loyal.
"Money doesn’t talk, it swear"
— Bob Dylan
"America believes in education: the average professor earns more money in a year than a professional athlete earns in a whole week."
— Evan Esar
In a continuing series of back-of-the-napkin drawings and posts on the Bucks blog Carl Richards, a financial planner, has been explaining the basics of money through simple graphs and diagrams. Here we bring them to you all in one place for easier browsing.
"An honest politician is one who, when he is bought, will stay bought."
— Simon Cameron
"Money can’t buy happiness, but neither can poverty."
— Leo Rosten
27. I’d save the excess milk from my cereal in the morning to be used the next day (and maybe the next).
25. Flipping your underwear inside out instead of doing laundry.
24. The sickest thing I’ve ever done to save money was eat bits of other peoples’ lunches that they left behind at one of my old jobs several years ago.
22. Dish soap instead of shampoo
21. Used to dig through the butts in my car’s ashtray when I was out of smokes.
17. Had a roomate that ate a 5 day old McDonalds Quarter Pounder that he forgot he left on his bookshelf. It didn’t look any different!
16. Dated a horrible person because she was rich and would pay for dinner out 6 nights a week
15. Rice with cinnamon for breakfast, rice with soy sauce for lunch, rice with ketchup for dinner. If I was feeling very saucy (!) I would mix the soy sauce and ketchup.
14. One winter we ate rabbit about 6 times per week and I was sucky at cooking it.
10. My uncle lived on unsweetened kool-aid and homemade biscuits for two years. The biscuits were flour and water - that’s it.
9. My ex boyfriend would take ketchup packets from fast food restaurants and make ketchup soup out of them- basically, ketchup and water.
8. Using coffee filters instead of toilet paper.
2. Once for about a week I used an old t-shirt I found in my shed as toilet paper.
At a theme park, Gneezy conducted a massive study of over 113,000 people who had to choose whether to buy a photo of themselves on a roller coaster. They were given one of four pricing plans. Under the basic one, when they were asked to pay a flat fee of $12.95 for the photo, only 0.5% of them did so.
When they could pay what they wanted, sales skyrocketed and 8.4% took a photo, almost 17 times more than before. But on average, the tight-fisted customers paid a measly $0.92 for the photo, which barely covered the cost of printing and actively selling one. That’s not the best business model – the company proves itself to be generous, it’s products sell like (free) hot-cakes, but its profit margins take a big hit. You could argue that Radiohead experienced the same thing – their album was a hit but customers paid relatively little for it.
When Gneezy told customers that half of the $12.95 price tag would go to charity, only 0.57% riders bought a photo – a pathetic increase over the standard price plan. This is akin to the practices of “corporate social responsibility” that many companies practice, where they try to demonstrate a sense of social consciousness. But financially, this approach had minimal benefits. It led to more sales, but once you take away the amount given to charity, the sound of hollow coffers came ringing out. You see the same thing on eBay. If people say that 10% of their earnings go to charity, their items only sell for around 2% more.
But when customers could pay what they wanted in the knowledge that half of that would go to charity, sales and profits went through the roof. Around 4.5% of the customers asked for a photo (up 9 times from the standard price plan), and on average, each one paid $5.33 for the privilege. Even after taking away the charitable donations, that still left Gneezy with a decent profit.
