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There's actually a pretty interesting behavioral economics point to be made here. From a purely rational standpoint, you would choose to make 1% over 0%, becaus
by tschwimmer 9y ago
There's actually a pretty interesting behavioral economics point to be made here. From a purely rational standpoint, you would choose to make 1% over 0%, because it's 1% more than you otherwise would have made. In practice, humans have a "fuck you" threshold above which they feel taken advantage of and refuse to cooperate. Check out the idealized economics experiment version of this which is called the Ultimatum Game: https://en.wikipedia.org/wiki/Ultimatum_game https://en.wikipedia.org/wiki/Ultimatum_game
- ryanwaggoner 9y agoI do find this super interesting as a pure behavioral economics question, but this situation is a bit more complicated. There's actual work to be done for this revenue, other costs you have to manage, opportunity costs for any capital you have invested, and the risk that you'll actually make enough at the end of the day for it to be worth it :)