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Risk always entails a premium.
by mattmaroon 2y ago
Risk always entails a premium.
- mypalmike 2y agoNot generally, no. Driving that car with the sketchy suspension is cheaper than getting it fixed.
- danielxt 2y agoit does, because the chances of you needing expensive medical care after using the sketchy vehicle go up
- vidarh 2y agoThis is obtuse. The intent of expressing that if you are paying someone else for a service, it predisposes them to demand a higher price if you're asking them to take additional risks if they have any negotiating power at all was pretty obvious.
- amyjess 2y agoA better analogy would be to buy a '60s sports car that predates nearly all modern safety tech at auction for $$$$$$ instead of just buying a 2024 Corolla with modern safety features.
- justinclift 2y agoThe grand parent post said risk _always_ entails a premium. They post you're replying to merely points out they're wrong, as there are examples of it not _always_ entailing a premium. No-one's saying that there aren't examples of risks that do entail a premium.
- mattmaroon 2y agoIncorrect. When somebody else takes a risk for you, you have to pay them more than if they are not taking a risk. We pay soldiers more when they are at war than when they are not. People who want to raise money by selling bonds have to pay a higher interest rate if their credit is worse. Etc. Prostitutes would consider unprotected sex more risky, and thus charge more.