

Bram Cohen with a startup idea - rms
http://bramcohen.livejournal.com/47414.html

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mixmax
It probably won't work because it contradicts behavioral economics. Daniel
Kahnemann won the nobel prize in economics in 1992 "for having integrated
insights from psychological research into economic science, especially
concerning human judgment and decision-making under uncertainty". One of his
findings is that people tend to overreact to small probability events, but
underreact to medium and large probabilities.

What that means in the case of this particular business model is that
customers will be wary of reserving a table at an early stage where they will
potentially pay a high price for the seating even though the probability of
this happening is very low.

If you haven't heard of Kahnemann's work his nobel lecture is definitely worth
watching - it will give you some great insights on pricing, auctions, and why
the economy works as it does.

[http://nobelprize.org/nobel_prizes/economics/laureates/2002/...](http://nobelprize.org/nobel_prizes/economics/laureates/2002/kahneman-
lecture.html)

~~~
akkartik
Didn't the black swan refer to Kahnemann? Drat, I've lent out my copy.

[http://www.amazon.com/Black-Swan-Impact-Highly-
Improbable/dp...](http://www.amazon.com/Black-Swan-Impact-Highly-
Improbable/dp/1400063515)

~~~
mixmax
I haven't read, but maybe I should - just checked out the reviews on amazon.

It is interesting to note though how markets (and in particular stockmarkets)
are heavily influenced by behavioral economics and traders inability to assess
a situation correctly in statistical terms, which creates a non-equilibrium in
the marketplace. I actually thought up a plan for exploiting this that might
just work, unfortunately I am not a programmer so I will have a tough time
implementing it.

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joeguilmette
heh i dont know if this would actually work in a restaurant.

how are they going to 'fulfill' the seating fee? does the user (restaurant
goer) have to sign up while they wait and pay $5 with their CC in a little
terminal before they sit down? if so, is this really any different from an
online reservation service like OpenTable (the variation being you aren't
actually getting anything in return from the service, just paying a fee)? are
customers supposed to be happy with this?

the only way this could practically work is if the seating fee was charged to
the bill when they are seated. how are you going to communicate this fee to
the customer? tell them at the door? any restaurant that implements this will
certainly solve the problem of over booking. they'll alienate all of their
customers.

"welcome to Posh Food, where we are so pompous we charge you a floating fee
for the privilege of dining here. right now it costs $8 just to sit down. cash
or charge?"

