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I'm not really satisfied with this explanation - it feels like a version of the broken window fallacy. Thinking about McDonalds in aggregate, broken machines m
by derriz 5y ago
I'm not really satisfied with this explanation - it feels like a version of the broken window fallacy.
Thinking about McDonalds in aggregate, broken machines mean less revenue and more expense (to pay for Taylor call-outs). On a net basis a double loss to the organization as a whole.
Even if these losses fall more on the franchise holders than the company itself (although the company also suffers from the loss in revenue) - creating an incentive for the company, it'd doesn't make much sense to me. This would amount to a scheme to effectively increase franchise fees. Given the huge inefficiency involved as well as the cost of the reputation damage, it doesn't make sense to me when there are far more efficient mechanisms available to the company which would achieve the same thing.
- TheCoelacanth 5y agoBroken window is the idea that the economy as a whole is better off because of a broken window. That's fallacious. Some people benefited because they were paid to replace the window, but the economy as a whole is poorer. The original owner is out the cost of a window. This isn't that fallacy. They aren't saying that there is an overall benefit to the window being broken. They are saying that McDonalds benefits at the expense of franchise owners.