I learned all about this in “thinking fast and slow” by Daniel Kahneman. He talks about system 1 and system 2, where system 1 is your kind of knee-jerk reaction to a thing (thinking fast), and system 2 is the contemplative and careful consideration of a thing (thinking slow).

I would argue that some people overly leverage system 1 (thinking fast) because it’s generally easier, and takes less time and mental effort to do. Those that either can’t, or are unwilling to engage system 2 in their day to day activities, will 100% fall for these kinds of misleading prices, since system 1 is cutting so many corners so that it can be fast and efficient (mostly on how much energy is used), that it skips a lot of the cognitive steps and goes right to the (often incorrect) conclusion. That $19.99 is $19 (or $10 in some cases).

In the book, they discuss that system 1 often gives the wrong information that is later rejected by system 2 when further consideration is given to a particular input/stimulus.

If someone isn’t engaging system 2 as a check to ensure system 1 isn’t lying to them, then shit like $19.99 seems cheaper than $20. It doesn’t hold up to any scrutiny, but they’re not targeting thoughtful people with these practices. For thoughtful people, there’s functionally no difference between $19.99 and $20.

Yes, the difference is one cent, but given that one cent is so worthless in today’s society, to the point that Canada stopped making one cent coins (and other countries have done so as well), there’s functionally no difference between the prices.

One cent is only worth anything if it is combined with many other cents. The sum of those pennies becomes valuable when you conglomerate enough of them.

I’ll admit, this works on me sometimes.

I hate that it does, but it do.

The science is about how you initially react to the number. Your brain will see $19, and immediately you’ll think it’s $19. Only upon further inspection and processing through your cognition, you recognise that its $19.99, which is basically $20.

It’s that initial reaction they want, to grab your attention. Anyone who is going through life without leveraging their higher thinking will fall for this shit. Anyone who thinks, at all, won’t.

Unfortunately, there’s a nontrivial number of people who fall into that first category. People who were never taught to think. They just do.

The owners of the legislature don’t want that, so it won’t get done.

The government doesn’t work for you, it works at the behest of those that have long since paid for the “elected” representatives.

Those people own companies that profit from all the misleading prices and adverts. They don’t have any interest in changing that.

I appreciate that you recognise the pitfalls here.

In don’t think you’re wrong at all, and I’m sure as shit not putting in the effort to figure out if you’re right or wrong, but if someone comes along with better/newer info, you have already recognized that the info you have might be outdated.

Kudos.

Living in Canada, this shit never worked for me.

Our laws require that pretty much everything is taxed, some more than others, but taxed nonetheless. Despite this, our laws also allow for the tax to be excluded from the price listed for an item, so tax has always been an unpleasant surprise during checkout for me.

I’m sure many other Canadians can echo my sentiment.

The fact is, I’m always expecting to pay between 10 and 15% more on pretty much everything when I get to the checkout, so I tend to do math in my head to figure it out. Let’s just say that when I see $4.99, it’s easier for my brain to figure out 10 (or 13%, or 15%) of $5 than it is to figure out the tax on $4.99, so I err higher rather than lower on everything.

I see $4.99, I think $5 +tax and I figure that will set me back somewhere between $5.50 and $6 at checkout. Doing the math, the current HST tax in Ontario where I am, IIRC is 13%. 13% of $4.99 is $0.6487 (the company will round up to the nearest penny, so 65 cents), which is $5.64. going from $5 at 15% (which is what I’ll do in my head for simplicity), I’d estimate it’s $5.75 at checkout, and get pleasantly surprised when I save 11 cents because the tax was less than I anticipated.

All of this shit is kind of moot IMO, since I think people aren’t looking at prices nearly as much as they used to. When I was young, debit cards didn’t exist, credit cards were a tedious process of filing out paperwork, and so most of the time people carried cash. It was common for people to add up their costs as they went to ensure that the cash they brought would cover the items they’re buying at the grocery. For smaller transactions like convenience stores, you’d just do it in your head, and for big ticket purchases, like appliances, furniture, vehicles, etc, you’d use cheques or credit cards because the hassle of doing that was outweighed by the liability of carrying thousands of dollars to the store to buy a thing.

With debit/interac/whatever, and the chip/sign, or chip/pin process (and/or “tap” to pay), you have convenient, and instant access to your entire life savings on a whim with near zero effort or inconvenience. It’s never been so easy to spend money (especially money you don’t have - eg overdraft or credit cards).

When I started to do my own grocery shopping, sometime after debit/interac/chip&pin was made to be commonplace, I rarely looked at prices. I assumed the price was reasonable for what I was buying, and concerning myself with the nickels and dimes of it all was more effort than I cared to put into buying something I wanted or needed.

With the prices of everything going haywire in the last 5 years or so, I find myself looking at prices a lot more and going for alternatives to my “usual” brands of products simply due to price alone, especially when grocery shopping. If I can kick my grocery bill from $300 to $250 by simply buying smarter, that’s a cheap date I get to go on with my spouse that I otherwise couldn’t afford. That’s more valuable to me than buying name brand cereal or cans of Campbell’s soup over the store brand.

IMO, I’m the problem… or rather, my previous mentality was the problem that in part led to the crazy increase in pricing. I didn’t concern myself if something was a cheaper option and just bought whatever I wanted or whatever I was used to buying. I don’t have brand loyalty beyond “this was good/worked in the past, so I’ll buy it again”. That amount of “loyalty” doesn’t extend to significant increases in the price of things. The prices went up and while my grocery bill went up, I didn’t pay much attention to it. That’s just what it cost me. The cost always changed because I wouldn’t always buy the same things, nor the same quantity of things. So I expected it to be fairly random. That created a false loyalty to products that just kept going up in price. I kept paying that because I wasn’t paying attention. So they kept going up because the company didn’t see a drop in sales because of the increase in price.

Now, I’m much more conscious of what I’m buying. I’ll compare not only the cost, but the quantity of a thing. If I can get 700g of something at $5 but an alternative has 1000g for $6. I’ll get the $6 item, since I’m paying more, for a lot more, therefore I’m paying less per gram. I’ve become the kind of shopper that most companies can’t keep. If prices go up, I’ll jump to another brand that’s cheaper. If the quantity goes down (shrinkflation) I’ll go to a brand that gives me better value for my dollar.

I’m one step away from cutting coupons here. I’ll do it too.

At the end of the day, it’s all about economics for me. If it’s going to take me more time to compare, or find coupons, or whatever than I’m saving by doing that, then I won’t do it. Right now, cutting coupons falls below that value line. I put my time ahead of the proposed savings by cutting coupons. My time saved by not doing it, is simply more valuable to me right now. If/when that changes, I’ll start doing it.

Fuck corporations.

She’s having a glass of wine, not getting shit faced. What the fuck is this tweet?