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john perry wednesday people are in a large part creatures...

Question: john perry wednesday people are in a large part creatures...

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John Perry Wednesday People are, in a large part, creatures of habit. That probably has good and bad aspects--but it seems hardwired in to most of us. And the more hardwired it is, probably the more inelastic we are. This got me to thinking about ways we automate our lives. For example, for a while, the Perrys used Amazons Subscribe and Save service. It is a pretty neat serviceyou select items to be sent to you on a schedule (every month, every other month, etc.) We did paper towels, dog food, cleaning products, etc-things that we routinely bought. For Prime members, it was free shipping and an extra discount. The sneaky part was that while when we set up up the schedule, we did so based on the prices at the time. What we did not appreciate then was the prices could change at any point. Amazon would notify you, but it was in an email that may or may not have gotten read. The net effect is that we would buy things without even knowing the price--it could go up or down (the up part was the frustrating part!). Thinking about this in elasticity terms, what effect does automating purchases have on elasticity? Dr. John

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