In my March NYT column, I discussed the price-measurement dilemmas created by subjective quality improvements like more aesthetic hotel design. Back in August 2003, I wrote a column on the increasing value of intangibles; I noted there that technocratic regulation (in this case, energy-oriented lighting rules) rarely recognize that consumers get real benefits from qualities that are hard to measure objectively--unless, of course, you accept the subjective evaluations captured by prices:
Prices capture the relative value people put on intangibles. The price system lets individuals make trade-offs among goods, without having to articulate a "good reason" for their preferences. It rewards value you cannot easily count.
Some critics find that wasteful. "Addiction to a strict and unremitting valuation of all things in terms of price and profit" leaves executives "unfit to appreciate those technological facts that can be formulated only in terms of tangible mechanical performance," Thorstein Veblen wrote in 1921 in "The Engineers and the Price System."
On a trip to the supermarket today, I came across a good example of how the "same" product can take on different values, even to the same consumer (in this case, me). I bought a 12-pack of 12-ounce Diet Coke, a staple item in the Postrel refrigerator, for $2.98; that's about 2.1 cents per ounce or 24.8 cents per can. Since I run though a lot of Diet Coke cans, especially when I'm writing, I generally know where the good deals are and try to pay no more than $3 for a 12-pack.
Yet I also purchased a six-pack of .5-liter (16.9-ounce) bottles for $2.78: 2.7 cents an ounce or 46.3 cents a bottle. Unlike the "staple" cans for home consumption, I'll take these bottles with me in my purse or the car. I do generally treat a single bottle, regardless of its size, as one serving, but I like to be able to close the container to avoid spills.
Finally, I bought a cold 20-ounce bottle of Diet Coke for $1.08, or 5.2 cents an ounce, and drank it immediately. If I'd had the change, I might have bought a 12-ounce can of even colder Diet Coke from a vending machine for 50 cents, or 4.2 cents an ounce.
I can explain all these differences, but they aren't exactly "rational" in the engineering sense (even assuming you accept the rationality of drinking a dozen or so Diet Cokes a day). I doubt that Veblen would approve of these wildly different prices. But Friedrich Hayek would understand.
Posted by Virginia Postrel on May 22, 2005 • Comments
My latest NYT column takes a look at the economic reasons media bias may not only persist but intensify--even (or especially) in a highly competitive marketplace.
Posted by Virginia Postrel on May 18, 2005 • Comments
Observant readers may have noticed some changes to the website sections above. We've added two new ones, to cover my current research on glamour and on "the variety revolution." While he was working on the new sections, designer Adrian Quan also tweaked the site format a bit to make it easier for readers, most noticeably by expanding the column width. Narrow screen displays are fairly rare these days, and wider columns mean I can stop using smaller type for indented quotes.
Posted by Virginia Postrel on May 16, 2005 • Comments
In a fun interview with the Pittsburgh Post-Gazette, John Tierney, a Pittsburgh native, talks about life as a New York Times op-ed columnist. (Thanks to Martin Wooster for the link.) This bit may suggest why the NYT has made the otherwise puzzling decision to charge for online access to its op-ed columns.
Q: Everyone in our business is agonizing about what will happen to journalism because of blogs and the Internet. I don't want to be cruel, but it seems to me that opinion columnists in newspapers are the most vulnerable to incursions from the Internet. If you have 8 million blogs with people expressing their opinions, why would you want to go to the newspaper?
A: There certainly is lots more competition, but it's interesting that on the Times web site the op-ed columnists are usually among the top e-mailed articles of the day. I believe also that our Web pages are among the most visited. The cliche is that there is so much information out there that people are looking for someone to interpret it for them. Now there are plenty of blogs that will do the interpretation for you, but I think that the more sources there are, the more people want to find some common ground.
I was a freelance magazine writer for 10 years and I hated The New York Times because I would spend two months writing what I considered the definitive article on something and put all this effort into it and it would be in a national magazine, and then an article on the subject would be in The New York Times and it would get all this attention because that was the bulletin board people looked at. I think people still want that bulletin board. Also, I've noticed since I started the column that there are many blogs that start debates based on the columns and the old media.
Despite all those emailed columns, it seems likely that the Times is underestimating online readers' elasticity of demand and is risking its status as the most-talked-about (and blogged-about) newspaper in the world. Besides, as various blog commenters have pointed out, (examples here and here), since the columns are syndicated you can find many of them on other newspapers' sites.
Left out of the blog discussion is an important aspect of the new premium service: Home delivery subscribers like me get it free, and it includes access to the large NYT archives that now charge on a per-article basis. Also, the premium columns include not just those on the op-ed page but others elsewhere in the paper, including major business section columnists.
I can't blame the Times for trying to sell more home-delivery subscriptions, which should boost ad revenue, or for trying to generate some revenue from its website. Maybe if they get this to work, they can give me a raise. But I'm not optimistic--about either the premium service or that raise.
UPDATE: "Well, if they throw in the Crossword Puzzle, I might consider it," writes reader Ray Eckhart, reminding me that the Times has long charged for online access to its puzzles.
Posted by Virginia Postrel on May 16, 2005 • Comments
The new Carnival of Tomorrow is up, featuring links to future-oriented blog postings and stories (including one from this site). Check it out.
Posted by Virginia Postrel on May 12, 2005 • Comments
On his excellent Long Tail blog, Wired editor Chris Anderson puts the diversity of blogs (and the narrow imagination of their critics) in statistical context. His entry echoes some of the points in my recent Forbes column, which has a new, more easily accessible link.
Posted by Virginia Postrel on May 12, 2005 • Comments
Without being wooed by economic development officials, Fluor, the international construction firm, is moving its headquarters from Orange County to an unselected location in the Dallas area. Naturally, the move has prompted commentary suggesting that California's high taxes, abundant regulation, and expensive housing are to blame. I'm sure those costs didn't help the O.C. (which was never called that before the TV show). But the main factors seem to ones no policy change could overcome: Dallas is in the middle of the country and on Central Time. As I always say, those are the very best things about this place compared to Southern California.
Posted by Virginia Postrel on May 12, 2005 • Comments
I've long enjoyed the email edition and occasionally linked to items on their site. Now John Paczkowsk's Good Morning Silicon Valley (part of San Jose Mercury News spinoff SiliconValley.com) is a full-fledged blog.
Posted by Virginia Postrel on May 10, 2005 • Comments
In a piece that nicely unites wonks and fashionistas, Reason's Kerry Howley examines the fashion implications of restricting (or liberalizing) textile and apparel trade, especially with China. Here's the beginning:
No sane person considers Washington D.C. to be fashion-forward, but trend watchers should take note: The capital is gearing up to decide what the rest of us will be wearing next season.
We may not all be forced into bowties or pantsuits, but a congressional push to re-impose quotas on Chinese imports will determine how well, and how cheaply, America dresses. Ever since trade quotas on Chinese textile imports fell away in the U.S. and Europe on January 1, and the U.S. has been buried in a downy avalanche of cheap tees and underwear. Imports of knitted shirts are up 1,250 percent this year. Cotton pants are up 1,500 percent; underwear, 300 percent. The dramatic surge in imports is an indication of just how obscenely low the old quotas were set, and how needlessly high clothing prices were. Recent studies put the cost of protectionism for the U.S. textile and apparel industry at as much as $13 billion annually.
The domestic textile industry was given ten long years to prepare for the deluge, but instead of modernizing, trade groups are legislating. With the support of the Bush administration, The U.S. Committee for the Implementation of Textile Agreements (CITA) has announced "China Safeguard Proceedings" to protect us from all Commie underwear, the first step in what will likely end with re-imposed quotas or worse. Chuck Schumer (D-N.Y.) says "it is time to bring out the big stick" and defines "stick" as 27.5 percent tariffs on all things Chinese. U.S. Trade Representative Rob Portman has promised "a tougher approach" with Beijing, as if decades of onerous quotas were an example of American largesse.
If politicians can resist the urge to stem the flow of imports, cheap Chinese clothing will create a better-dressed America and a sleeker fashion industry. Clothing prices have been falling for a decade, helped along by the rise of cheap chic a la H&M, Zara, and Forever 21. These stores have earned fat profits ripping off the work of Donna Karan, Michael Kors, Ralph Lauren and other fashion luminaries. By pumping out cheaply made imitations from the developing world, the shops have created a world of disposable fashion, letting teens stay trendy without sinking hundreds in a look that won't last. A $10 H&M camisole — likely China-made — will last about as long as the trend it's following, which is to say, a wash or two. It's not just moral depravity driving your 14-year-old to stuff her closet with trampy knock-offs; she can afford to approximate Beyonce's bling and Lil' Kim's decolletage like never before.
Read the whole thing.
Posted by Virginia Postrel on May 10, 2005 • Comments
Speaking of the LAT, the paper has wisely redesigned its website, eliminating its most annoying characteristic--subscriber-only access to the Calendar section, which includes all the LAT's arts and culture coverage. The changes are explained here. For all its flaws (see Kausfiles for running commentary), the LAT is a good newspaper that deserves a national readership. East Coast bias is hard to break down, but easy Internet access helps.
Posted by Virginia Postrel on May 10, 2005 • Comments