An after-school centre in Israel started fining parents if they picked their kids up too late. But it made the problem worse: late pick ups increased as the fine was now seen as a ‘fee for services’.
Perverse incentives
Be careful what you wish for.
Houses in Amsterdam are narrow because of tax evasion. In the 16th century they were taxed by the width of a property’s canal frontage, rather than total size, which incentivized the construction of narrow, deep, and tall buildings.
In 1927 British cinemas specified that a proportion of films shown had to be made in Britain. So to avoid losing out, American studios set up production facilities locally and churned out ‘quota quickies’. Many of the films, like the Demon Barber of Fleet Street, were so bad that they were screened to empty cinemas while cleaners cleaned up.
Athens example
Doctor performance
For years, Domino’s Pizza had a promotion that guaranteed delivery within 30 mins or the pizza was free. But it meant delivery drivers often sped to make the deadline and caused a number of accidents, with one crash victim sueing Domino’s for $79m. The chain shut the promotion down, citing “public perception of reckless driving and irresponsibility.”
France has over twice as many companies with 49 staff as with 50. Why? At 50 employees, companies are must abide by a range of regulations including mandatory works councils and more stringent dismissal procedures.
spotify makes money per stream, no incentive to make more experimental songs that you do with an album. Instead artists only want to make songs that they think will be streamed – > leading to shorter songs