Rational discrimination

November 13, 2007 7:22am

A loyal reader, Andrew Schneller, writes about my article on coffee-shop discrimination:

You fail to consider that it may be profit maximizing behavior to serve men more quickly.  If women tend to tolerate 20 seconds of extra waiting while men defect to other coffee shops after experiencing a longer wait, it would make sense to serve men faster. Firms offer different service levels to different types of customers all the time.  Maybe, in this case, the consumer behavior that drives service level differentiation correlates highly with gender.

This is an excellent point - at least in theory. (It would be hard to test in practice.) I am embarrassed not to have considered the possibility, especially since The Logic of Life has a long riff on the difference between rational (that is, profitable, not praiseworthy) discrimination and irrational discrimination.