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user-inactivated  ·  3177 days ago  ·  link  ·    ·  parent  ·  post: What would the short and long term effects of automization/ replacing human low skill workers with robots be?

It's really odd how price elasticity is coming into fruition. A lesser known example is how hotwire and orbitz actually work called price stratification. The hotel knows that they can charge 180 per night for a given room. But they also know that there are people who will willingly pay 220 and not bat an eyelash. So they find out how those people book hotel rooms and let them pay 220 through that venue. Then they have the people who buy rooms at 180 and do the same. Finally they know that no matter what, there are some people who despite their need for a hotel room will simply not book a room at 180 a night. But they would fill the room at above cost if the room was a 'deal' or somehow impressive to them. So they sell that room through orbitz and they have a full hotel and a higher profit despite charging people different prices.

Same with airlines, first class is for people who will pay for first class, not people with money.