Having to pay for airline comfort, convenience | kelownadailycourier.ca

Economists have a high level of faith in pricing to convey information to the consumer and to influence consumer behaviour. Recently I traveled to eastern Canada and in so doing observed several cases in which pricing policy did its job – and cases where it conspicuously didn’t.

For example, the Airbus 319 used on the Kelowna to Toronto non-stop flight has so little leg room in most rows, it’s virtually impossible for someone who is 1.88 meters to sit upright with feet on the floor. You might think the solution to this problem is the removal of two rows of seats to provide more leg room throughout the economy class. The ticket might cost a bit more but the comfort level would be increased immensely.

Instead, Air Canada Rouge forces us tall people to purchase a more expensive seat assignment in the few rows with standard (not cattle-car) legroom. A higher price is used to signal that in these seats you will not be squashed if the seat in front of you is reclined to any degree and that, if you put down the tray for your drink, it will be level. Useful to know, if irritating.

When first established, the price of a one way ticket was just about equivalent to that of a taxi to downtown. Not surprisingly, the use of the facility was minimal. However, when management substantially reduced the price (for a senior at off peak times the fare was about $6.50 versus $50 for a cab) the usage grew by leaps and bounds. When I took it on a Saturday evening, virtually every seat was taken.

What this little story shows is the impact of intelligent pricing. The price of anything contains information not just about its costs but also allows easy comparison with the possible substitutes. And thoughtful pricing can also encourage socially beneficial consumer behaviour.

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Having to pay for airline comfort, convenience | Opinion | kelownadailycourier.ca.