Collective Action and Detergent

Friedmans famously says “The fewer issues on which agreement is necessary the greater the likelihood of getting agreement while having a free society. (24)” 

I currently live with roommates and there are times when we have to come together, collectively, to determine the goods/services we are willing to have, one of those being laundry detergent. Each of the four of us has different preferences when it comes to detergent and its consumption. I prefer All Liquid, Declan prefers Tide pods, and so on. Last year we collectively agreed upon Tide Liquid and to have me purchase it the first time then Declan and so on until it was my turn again.  However, as the first unit was consumed there was no urgency from Declan to buy more. I do my laundry the most in my apartment so I was the first to feel the burden. Being unwilling to go long without washing my clothes I purchased another unit. And was once again promised by my apartment mates that one of them would purchase it next time.

As the second unit of Tide came and went I realized I would be going without detergent again so I purchased All Liquid and kept it in my room. A week went by and Sami to his dismay found no detergent left so he purchased Tide liquid. Not so long after Declan found himself in a similar situation and asked the group why we had no detergent. I recommended that we all buy our own detergent given our different preferences for it and its consumption. But to my dismay, my recommendation was ill-received, which made me question if Friedman was right after all. Since everyone had their own preference toward laundry detergent and its consumption then naturally everyone buying their own detergent made the most sense economically…right? But upon reflection, I realized my mistake: I didn’t take into account that by privatizing the detergent the rest of my apartment mates would finally have to buy their own detergent. This meant my apartmentmates could no longer free-ride and would have to bear the costs of detergent. I decided to continue purchasing my own detergent for the rest of the year and eventually, everyone purchased their own detergent too.

Collective Action on r/NoStupidQuestions

 I was scrolling through reddit this morning and came across an interesting post on r/NoStupidQuestions. 

u/myuponmyname asks:

“Why is the minimum wage in the US still $7.25/hr?”

I'm interested in discussing this topic specifically, but I did come across a few interesting comments  

u/Sociopathic_Humanist comments:

“Because people making minimum wage can’t afford lobbyists”

u/redditipobuster replies to this comment:

“If they all chipped in $1…

There’s more poor people than rich.”

u/redditipobuster just discovered collective action. If all the poor people just chipped in a few dollars they could raise like a billion dollars! If 200 million americans each just chipped in $5, they would have a billion dollars to lobby and affect change. But after everyone has pitched in their money, and that last 200 millionth person is the only one left. An extra $5 is insignificant to the nearly billion already raised. Why give up a starbucks coffee for no reason…

Thus, the free rider problem arises. Now all 200 million people might start to have doubts. Who doesn’t want their morning coffee or an extra gallon of gas. 

I strongly contemplated explaining this to u/redditipobuster, but something tells me they wouldn’t have appreciated it as much as the 26 avid readers of Better than Plowing. 

Paw-sitive Externalities

Last Friday, a kitten followed my boyfriend and me down Wertland Street. The kitten was SO cute (see pictures below), I couldn’t resist sharing the pictures with my friends. Everyone wanted me to keep it. While adorable, the prospect of fostering a kitten in my college apartment and paying a rather large pet fee was daunting (not to mention my parents’ extreme disapproval of cats). After dropping the kitten off at the SPCA to get a checkup, I needed to make a decision.

When a friend mentioned being willing to chip in for the pet fee, I was reminded of our conversation about positive externalities. Having a kitten, or even access to one, is scientifically proven to boost your mental health, reduce stress, and even reduce your chances of having a heart attack. However low the social marginal costs are to my friends, my private marginal costs of providing for the kitten are higher. Buying a cat bed and food, taking care of a litter box, and coughing up $395 for the pet fee did not make everyone else’s happiness worth it for me. Maybe my friend was on to something by helping to reduce my cost of keeping the kitten…

So rather than give up on adopting the kitten, I will be requesting subsidies (through Venmo) from my kitten-loving friends so that everyone can visit Ivy.