BG Economics - Fooled by Randomness

[Gadfly]

Or How BGs try to set prices.

 

I was at Spicy's last night at around 3 am, and the number of guys clearly outnumbered the better looking (acceptable) girls by about 3 to 1. The girls knew this, and were picky. One particular girl, who would have been at best a "5" at 9:30 pm in a Soi Cowboy bar, was now a "9", and insisting on 2,000 Baht for a short time. She also, incongruously, insisted she was "good" girl.

 

I was tired, but still wanted a last round, and I didn'w want to waste hours "negotiating" with her, particularly when the odds were against me and a few other guys seemed interested in her and perhaps willing to pay the late night premimum she was demanding.

 

She also noticed that the ratio was in favor, or so she thought. But I admantly insisted it was not. I said "no" the girls clearly out number the men: "7 out of ten here are girls." I said this with absolute conviction even though I absolutely did not believe it. She insisted I was wrong, but there was now a clearly a hesitat tone in her voice.

 

I picked a time when there just happened to be more girls near us than guys. This will happen in any crowd. I said, "see, look, seven girls, 1, 2, 3...and only two guys." She counted too, thinking that perhaps I was wrong, but I wasn't - at least at that moment.

 

But this was just a random event, and if she had waited a few more minutes and we sampled the crowd a few more times, it would have been absolutely clear that this was an aberration. These sorts of aberrations occur all the time as crowds move through a crowded bar, but this apparantly did not occur to her.

 

Her confidence was shaken. I insisted the odds would only get worse, and she quickly dropped her price to 1,000 Baht.

 

The point to all of this is as follows: what we often call here "bar girl" or "Thai" economics, works both ways. Bullshit can also easily be manipulated in your favor. People everywhere attach more attention to aberrations than they warrant, and this is particularly true of BGs. And Farangs.

[cavanami]

Got to love numbers...as they say, "figures don't lie, but liars do figure".

[Gadfly]

"figures don't lie, but liars do figure".

True. Because most people don't appreciate that bell curves have tails (otherwise they wouldn't be bell curves), you can use a bit of selective sampling from those tails for creative figuring.

[Stickman]

Well done!

 

I like it when the tables are turned like this. In the end you both got what could be termed a fair deal.

 

Often with the Thais I feel they want to feel like they have the upper hand in a deal. Even if they are doing well, it's like they want you to know that they are doing well!

[cavanami]

I have heard that a "fair deal" is where both parties complete the negotiations and feel that each one had been "cheated" or came away losing too much.

[dddave]

I understand that the NANA NOOKIE PROVIDERS ASSN. hired a marketing consulting firm to develop an algorithm similar to those used by airlines that provides real time supply/demand price analysis.

[Gadfly]

I understand that the NANA NOOKIE PROVIDERS ASSN. hired a marketing consulting firm to develop an algorithm similar to those used by airlines that provides real time supply/demand price analysis.

 

This would explain why this low season is particularly low.