Meditations and Learnings

Meditations and Learnings

Do Commercial Business Overcharge?

When judging whether service providers charge too much, we can look at people’s preferences when given alternatives because they vote with their feet when choosing between commercial businesses and non-profit organisations. Colleges routinely contract out services to private companies because they run at lower costs and generate enough profit to pay the college. The University of California barely made as much as $100k per year from its bookstore. Barnes & Noble paid them $500k just for the rights to run it. Non-profit organisations are ceding more and more of their economic activities to profit-seeking businesses.