Boy, I never thought we’d see gasoline prices drop to $2.50 a gallon again…for some reason, when I fill up these days it’s with a smirk of satisfaction on my face.
With oil prices collapsing, it’s easy to breathe a sigh of relief and think OPEC’s stranglehold is over. My latest piece for the Harvard Business Review discusses a little known strategy employed by cartels. The common thought is collusion leads to higher prices. This piece argues that especially in high fixed cost industries, it may be a profitable detour to higher prices. So enjoy the cheap gas but I’d hold off purchasing that gas guzzler…as higher prices are on the horizon.
As always, thank you for reading, Apologies for the recent writing breather – regular blogs are back!
Posted on December 11th, 2014 (0 Comments)
Here in downtown Boston, parking at a private garage runs $12 for the first hour or I can park at a mater for $1.25 an hour. It shouldn’t be a surprises that as a result of this below-market pricing, cars are circling (and circling) in hopes of landing a prime rock-bottom priced parking space? A controversial new app – Haystack – is trying to arbitrage off of this poor pricing. For a $3 fee, parking seekers are directed to about to be vacant meter spots. As a result, public officials are grappling whether to somehow ban these types of apps and drivers are wondering if it is ethical to “save” a parking space for others.
Please check out my latest piece for the Harvard Business Review which argues that the root of the problem is underpriced downtown meter rates. City officials should stop worrying about parking apps and instead focus on getting the price right for public parking spaces.
Posted on July 28th, 2014 (0 Comments)
Uber is overtaking the world! In just four years, the private car sharing service has grown from its debut in San Francisco to now serving 143 cities in 40 countries. Investors, of course, are taking note. A recent private investment effectively valued Uber at $18.2 billion – only Facebook raised money from investors at a higher valuation!
As much as I am enamored with Uber’s service – it’s playing in an uneven playing field. Local governments regulate the prices of Uber’s chief rivals, taxi cabs. As a result, taxi cabs are sitting ducks to Uber’s opportunistic pricing. Please check out my latest piece for the Harvard Business Review which discusses this unfair competitive environment.
The Amazon/Hachette battle is totally centered on price – please check out my recent appearance on Bloomberg West where I discuss this issue.
Posted on July 10th, 2014 (0 Comments)