Earlier quoted context omitted.
>> That’s basically the definition of a discriminating monopolist and what gets you airline-style inscrutable pricing and the SSO tax, isn’t it? > You think it's discrimination to ask people who use more of a service to pay more? Terminology confusion. In microeconomics, a “discriminating monopolist” is one who engages in “price discrimination”, that is to say providing the same service to everybody but charging each…
> an airline or railway that on transitioning from all refundable tickets to a split of non-refundable and refundable tickets ended up making non-refundable tickets measurably cheaper (in the long run) I don’t know how long is the long run for you, but Delta is right now offering RT to Vegas for $444 non-refundable and $638 refundable. I didn’t go check all the other carriers, but I definitely recall tickets with mor…
Some airlines in my memory went from only having refundable tickets to having both types, and for some reason the price of the nonrefundable ones after the change ends up being about the same as the price of the (refundable) ones before that.
Also, well, I don’t know what Delta does—for some airlines, the advertising term “flexible” means some sort of option to change your flight as well as one to refund the ticket, being a tier above “refundable”—but if the buyer requesting a refund is the only possible cost, we should have roughly $444 = $638 / [1 - P(refund)], whereby P(refund) = 30%, and that feels ridiculously high. Not implausibly high (I’m used to a difference of 2x or more), but high enough that I’m dubious.