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Exactly my thoughts, the current pricing model incentives people to cram as much as possible into their carry-on and stretch the definition of their extra "personal item" (not sure if all airlines allow those), leading to all kinds of shenanigans especially on full flights. I think the situation would improve a lot if you were always given 1 free bag to check in and a paid option for a carry-on, especially if they can guarantee the space.

Yes I always thought that airlines wanted to encourage checked bags because people having to stow their carry-on bags dramatically slows down the time needed for boarding.

This. Not to mention deplaning and more expense time screening for security.

Checked bags require the airline to pay humans to move them.