I was at JFK today, and I decided that I needed coffee, so I headed for Dunkin' Donuts, as any reasonable man might. First of all, where did "small" go? They offer three sizes, M, L, and XL. "XL" but no small? That's pretty funny.
But much stranger still is that M is, by all rights, a "true" L. A model of "size inflation" would, I think, say that the size names would go up and up but the true sizes would stay the same. Surely that's what happened with dress sizes (the infamous "size 0"). At no price can I buy a reasonably small cup of coffee at Dunkin' Donuts.
I think it's hard to write down a regular economic model in which sellers force you to take more of something than you want, even if you'd pay just as much for less, when the production function exhibits positive marginal cost everywhere...even if marginal cost is really really small. So what is going on?
As a result of this debacle, I was extremely and uncomfortably wired (which only happens to me when I way-over-consume coffee) for hours while waiting for my flight. But the E-190 is a fun little plane, Jetblue has a winner there. As always, I went stand-by on an earlier flight and yet got put in the best seat possible, 1A.
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Because caffeine is an addictive substance, perhaps the coffee purrveyors believe if they give you more now, that will mean a greater chance you will purchase more at a later date.
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