{"id":2885,"date":"2010-01-18T13:07:42","date_gmt":"2010-01-18T18:07:42","guid":{"rendered":"http:\/\/onthe8spot.com\/?p=2885"},"modified":"2010-01-18T13:07:42","modified_gmt":"2010-01-18T18:07:42","slug":"repostthe-price-of-impatience-freakonomics-blog-nytimes-com","status":"publish","type":"post","link":"http:\/\/onthe8spot.com\/index.php\/2010\/01\/18\/repostthe-price-of-impatience-freakonomics-blog-nytimes-com\/","title":{"rendered":"rePost::The Price of Impatience – Freakonomics Blog – NYTimes.com"},"content":{"rendered":"
\nWhy a lot of people can’t be trusted with markets. This is a relatively easy calculation to make, but ordinary people make this mistake. Maybe there really is a need for some foundation of some kind to teach simple financial\/life lessons to help people act more rationally.<\/p>\n

The price offered to coffee growers who turn in their \u201ccherries\u201d \u2014 ripe coffee beans \u2014 at Greenwell Farms in Kona, Hawaii, is $.90 per pound if they are paid weekly and $1.05 if paid monthly.
\nThe weekly price is lower because it takes the company\u2019s accountants more time to work out and record pay if they do it weekly rather than once a month. But what does this price differential imply about the grower\u2019s discount rate? If he takes the weekly rate, on average he is getting $.90 one-half month earlier than he would get $1.05.
\nThat implies an annual discount rate of nearly 4,000 percent \u2014 (1.05\/.90)^24 – 1 \u2013- a truly remarkable rate of impatience. Despite this, the tour guide tells me that a lot of growers do take the lower rate of pay.
\nvia The Price of Impatience – Freakonomics Blog – NYTimes.com<\/a>.<\/p><\/blockquote>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Why a lot of people can’t be trusted with markets. This is a relatively easy calculation to make, but ordinary people make this mistake. Maybe there really is a need for some foundation of some kind to teach simple financial\/life lessons to help people act more rationally. The price offered to coffee growers who turn … <\/p>\n

Continue reading “rePost::The Price of Impatience – Freakonomics Blog – NYTimes.com”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[43,79],"tags":[],"class_list":["post-2885","post","type-post","status-publish","format-standard","hentry","category-idea","category-reposts"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"http:\/\/onthe8spot.com\/index.php\/wp-json\/wp\/v2\/posts\/2885","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/onthe8spot.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/onthe8spot.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/onthe8spot.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/onthe8spot.com\/index.php\/wp-json\/wp\/v2\/comments?post=2885"}],"version-history":[{"count":0,"href":"http:\/\/onthe8spot.com\/index.php\/wp-json\/wp\/v2\/posts\/2885\/revisions"}],"wp:attachment":[{"href":"http:\/\/onthe8spot.com\/index.php\/wp-json\/wp\/v2\/media?parent=2885"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/onthe8spot.com\/index.php\/wp-json\/wp\/v2\/categories?post=2885"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/onthe8spot.com\/index.php\/wp-json\/wp\/v2\/tags?post=2885"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}