Slate Magazine has a fascinating article on the economics of Starbucks, which focuses on “the elusive ‘short’ cappuccino”; or why Starbucks will serve you “a better, stronger cappuccino if you want one, and they will charge you less for it.”

It turns out to be a nice primer on price discrimination, and presenting your cheapest product in a way that allows the most price-sensitive customers to enjoy it, while trying to scare off those who can afford to pay more. Very nice read.

6:49 am - posted by . Categories: Economics
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