Good Morning,
Those of you who use our filtered water machine probably noticed a bubbly/fizz appearance to the water in your glass this morning.
We spoke to the service manager who assures us that the water is safe to drink.
They hope to be here possibly today but probably tomorrow to flush the air out of the line.
Thank you, and have a great Monday.
Whether or not I drink this water and die horribly, most likely twitching and begging for mercy, would normally only be of interest to me, my family and friends, and my insurance company. However I think it illuminates how complex human decision making actually is. In order to decide to drink this water I must go through the following logical steps:
1) Decide what premium I put on filtered over bottled water. As it turns out the answer to this is zero, because I am a bad person who enjoys destroying the environment, but in order to avoid a premature end to this discussion we'll move on to step two. But consider how complex just this one step is. There's no way I could quantify to you how much I prefer, say, Shiner Bock over Lone Star when I'm drinking beer, and yet I know exactly how much.
2) Discount the enjoyment premium for filtered water by the likelihood that the office manager is lying about having determined the water is safe. Negligible likelihood, in this case, but you never know. She might smile, and smile, and be a villain.
3) Discount again for the likelihood that the office manager is telling the truth but the filtered water company is lying. I know nothing about the filtered water company so here my evaluation is based on the fact that poisoning your customers is generally a poor marketing technique. And yet there is thalidomide, asbestos, and a hundred other cases where poisoning your customers was in fact a preferred business model. Dicey.
4) Discount for the likelihood that the filtered water company is telling the truth but is wrong. Tragic. I have no way whatsoever of evaluating this.
And if you think about it, these aren't even all the calculations. I also have to account for the fact that something bad might have happened to the bottled water, or that the bottled water company is evil and sources directly from the Love Canal, or that one or the other might not kill me but might give me cancer that will manifest itself a few decades hence without me even knowing its source. And a hundred other factors.
Credit comes from the Latin for belief, and it's more than just the stuff you get from the charge card companies; it's also the faith you put into things like the filtered water company's promise that those bubbles aren't mustard gas. It's what makes the world go 'round.
Behavioral economists have demonstrated that we aren't actually that good at evaluating it, which is why statist types think we need meat inspectors to look for chopped-off fingers in our beef and tell us not to urinate upstream of the drinking water pipe and make sure company executives aren't trading on privileged information. The problem they overlook is that the inspectors are just another set of people you have to credit - and the government's credit is thinner than most, considering how often they've proven just how bad they are at the inspection business.
Credit verification, i.e. health and safety regulations, also have costs. Maybe those costs aren't a big deal. To go back to that other kind of credit for a moment, we know what happens when mortgage companies try to skip the credit verification cost: they issue no-doc loans and turn neighborhoods into foreclosure wastelands. On the other hand, it was the Fed and its cheap money that made it possible to do that. So maybe the actual lesson there is that credit verification doesn't work if the biggest source of noise on the channel is also the chief noise suppressor.
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