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Comment by anaolykarpov | Hacker News Reader

There was a MOOC on Coursera called "Irrational Behaviour" and one of the stories there is about a locksmith who in the beginning of his career used to fix a door lock in more than an hour, with lots of effort and almost always destroying the door. His clients were happy to pay him the 70 dollars he charged for the operation and also tipped him most of the time. As time went by and his experience increased he got to a point where he was fixing the door locks in 10 or 15 minutes with virtually no disturbances for the customers. His tips started to fade off and his customers became outraged at his 70$ charged for those 10 mins of work.

Conclusion: we don't want to pay related to the value we receive for a certain service, but to the amount of effort involved in the delivery of that service.

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>Conclusion: we don't want to pay related to the value we receive for a certain service, but to the amount of effort involved in the delivery of that service.

I don't think that's a fair conclusion. There's much more going on here.

Locks are security for people. If I call a locksmith and he takes over an hour to open or fix my lock, I think, "Oh, good, even a professional is going to take some time to get through this. It's pretty secure!" If the locksmith is done in 10 minutes, I think, "Holy shit! With the right tools and know-how, someone can completely bypass my security in ten minutes!" This isn't so shocking around here, because most people on HN know just how vulnerable most security systems can be. Many people will not have that knowledge and be comforted by a locksmith taking longer.

Also, when you hire a locksmith, you usually watch the locksmith do his work- either because you're locked out of something and have to stand around uselessly, or the guy is in your house and it shouldn't take too long. This makes you invested in his effort- if it takes an hour, you watched the locksmith work for an hour. It's hard not to pay, given that you saw how long it took, and how he was working at it.

The same standard doesn't seem to apply elsewhere- if my steak takes an hour rather than twenty minutes, I'm not going to pay more for it, I'm going to complain to the manager. If the oil change takes too long, I'm not going to be happy about that, either. If I buy a cabinet, I usually don't care if the carpenter took 10 hours or 20, I'm going to want to pay based on the quality of the cabinet.

I think your conclusion is true in some situations, but it's definitely not universal to all work.

I think this is mostly true.

However, if you were watching someone prepare the most exquisite steak, and it took lets say a full hour to trim the meat, get the pan ready and properly buttered, cook off the edges of the steak, etc, and you were sitting there watching the chef go through this metiMaybe we just care about seeing the complexity in an operation for it to have value.culous process, then perhaps you wouldn't be upset that it took so long--and most likely would enjoy the steak more, having seen the entire complxex and careful process to cook the thing.

Similarly, if an oil change was a complex operation and you watched the mechanic half-dismantle your car to change whatever needed changing.

Or if you watched a programmer bounce around the screen in vim for 20 hours; coding, testing, tweaking, and debugging.

The smart locksmith would open your door in 10 minutes, then offer to sell you a more expensive lock.

> If I buy a cabinet, I usually don't care if the carpenter took 10 hours or 20, I'm going to want to pay based on the quality of the cabinet.

I don't think that is true if you comissioned the cabinet or watched how to make it. I have seen the irrational behaviour several times in action in different scenarios: painters, landscapers, carpinters.

This is the mechanic story all over: Guy takes his car to a garage because it keeps breaking down, and the mechanic leans in and listens to the engine for a minute. He goes and gets a hammer and listens to the engine again, and then raps sharply on the engine casing. The engine goes back into sync and stops breaking down.

The mechanic says "that'll be £500, please." The guy's outraged: "But all you did was tap it!"

Mechanic replies "it was a pound for the tap, and £499 for knowing where to tap."

Edit: Crap, beaten to it.

Experience pays in other professions that require competency, though: a surgeon who can proficiently perform a bypass in a short amount of time is far more valuable than a fresh graduate who potters around in there for a while. No one ever complains that a surgeon finished too quickly.

The surgery marketplace is way too ignorant to be a real marketplace. Nobody has any idea how long my mother-in-law was under actually under the knife and nobody involved other than the surgeon, has any idea what the going rate is for gallbladder removal. Two minutes? Two hours? No one involved on the "purchase side" of the market can even guess. Without a functioning marketplace, numerical metrics don't mean much.

Another interesting issue is she shopped for a GP a long time ago, the GP referred her to specialist who referred her to the surgeon, can't have much of a marketplace if the participants aren't making any decisions. The only decision she made was a decade ago she picked the guy who referred her to the guy who referred her to a surgeon.

The craziest part of a crazy "market" or whatever you want to call it, is it mostly works. Something this screwed up should predictably kill everyone involved, but most of the time, it works, other than blowing a lot of money. It is the truly shocking part of the situation, at least from a "free market capitalism is the only system that, in practice, actually works" mantra. Maybe that's not so true, given the observational evidence.

It gets worse, because it's such a probabilistic market. How does any patient tell the difference between a surgeon with a 10% fatality rate and a worse one with an 11% fatality rate? (At the usual estimates of the value of a life in the several millions USD, that 1% is worth a lot.) And if they somehow had that data, how would they adjust for the surgeons' working in different geographies or specializing in slightly different patient types?

This sort of problem is why making hospitals release medical data hasn't been very useful. And if you can't get much reliable signal out of large datasets with rigorous statistical analysis, how are ordinary people and gossip supposed to reach the right answers which could allow market mechanisms work?

The origin of that story is Charles Steinmetz, and it involves Henry Ford, a $10,000 invoice and placing a X in chalk. http://www.smithsonianmag.com/history/charles-proteus-steinm...

According to Snopes[1]:

"Practically anyone famous for his knowledge can be offered up as the virtuoso in this tale... Nikola Tesla, Thomas Edison, George Washington, the electrical genius Charles Proteus Steinmetz... How long this story has been around is a mystery."

http://www.snopes.com/business/genius/where.asp

> One Friday afternoon in 1921, Steinmetz hopped in his electric car and headed off for a weekend at...

Whu?

http://en.wikipedia.org/wiki/Electric_car#Golden_age

"In 1900, 40% of American automobiles were powered by steam, 38% by electricity, and 22% by gasoline.[19]"

Well, that's absolutely blown my mind -thank you.

Now I just want to know how they were dealing with power storage...

Also: http://en.wikipedia.org/wiki/La_Jamais_Contente

I have a different experience. Our heating broke on two (unrelated) occasions.

In the first case, the repairman came, fixed the thing in 20 minutes, seemed competent, and I gladly payed him.

In the second case, the company sent an inexperienced employee, who couldn't figure out the problem, and spent 2 hours trying everything before finally deciding the most expensive component needed to be replaced. I was very unsatisfied, especially since they charged me for all the seemingly pointless troubleshooting time.

So maybe it's not only important to make a lot of effort, but to also appear competent while working?

I had a similar experience with a plumber. Normally, I would have no clue how experienced the person was, but this particular person kept "missing" certain parts and had to make 3 trips to the hardware store! He only charged me for the first, but, clearly he didn't know what he was doing.

I hit this on HN a couple of years ago:

http://www.90percentofeverything.com/2010/12/16/adding-delay...

I also wrote about it. It's real. Many customers are not happy if you make it seem too easy.

A couple of years ago, I locked myself out of the house. I called a locksmith, who showed up at the house surprisingly quickly.

After spending a number of minutes fiddling with some impressive-looking lock picks and exercising what must be years of learned skill, he couldn't unlock the door. Sheepishly, he put away the specific tools and pulled out a dummy key + a rubber mallet.

The locksmith put the dummy key into the lock tumbler, whacked it once on the head with the rubber mallet, and the door unlocked. From the time he produced the tools to the time I was inside the house was well under sixty seconds.

I thought, Why didn't he just do that in the first place? And concluded much the same as you've said -- $70 for thirty seconds of work might seem steep and some people need the song and dance. Personally, I was grateful to have on-demand service like that available so quickly :)

If you're curious, the "dummy key" is a bump key. It's a relatively crude tool and is relatively hard on the lock, compared to traditional picking. There's also a certain level of professional pride, as you observed.

Hitting it with a mallet imparts force on the upper half of the pins, causing them all to briefly jump above the shear line, and at that moment the lock can turn freely without binding a pin.

A vibrating pick gun does essentially the same thing in a somewhat more controlled way.

The Parable of the Handyman's invoice

http://www.snopes.com/business/genius/where.asp

That's because value is a nebulous term, and the common unit of measure which anyone can relate to is time.

> Conclusion: we don't want to pay related to the value we receive for a certain service, but to the amount of effort involved in the delivery of that service.

But is that irrational? This seems to be a personal preference. By refusing to pay the same price for 10 minutes of work or one hour of work, we assert that we do believe in a certain income equality. "Disturbing someone for one hour vs 10 minutes" is not a necessarily irrational way to look at the situation.

No, people get angry at being charged $70 for 10 minutes of work because they think they're getting cheated, even though in this case they aren't.

You're not going to find your rationalization for socialism here.

And why do they think they're getting cheated?

Because the hourly rate looks very high.

It seems more rational to look at things as having your doorlock fixed, because that is why you call for the locksmith. You don't call just to see someone doing his job for the sake of it.

It's irrational because the 10 minutes of work that doesn't destroy the door is worth much more than the hour of work that does - replacing a door is expensive and costs the homeowner additional time and aggravation.

Also, it's really more than 10 minutes of work, since the locksmith has to spend time driving to and from the customer. His fee needs to cover his travel time and expenses (gas, wear and tear on his truck, insurance, etc.). So $70 for a 10 minute house call doesn't seem unreasonable.

I'm with you on the first point, but your second seems to undermine the first. The argument isn't "$70 per hour is reasonable, and a 10-minute call takes an hour." As far as I can tell, it's whether "Fixing the lock is not worth less because it took less time, the end result is what you pay for" is true.

Not only that, but you have to also account for the time that the locksmith spent learning the craft. And the opportunity cost of that learning/practicing time.

This. While common in many fields, I feel that this is most obvious with musicians. "What? I'm not paying this band $1000 for a 2 hour performance!" When, in reality, you are paying them for many hours of practice in order to prepare for that 2 hour performance as well.

It doesn't have to be amount of effort, even. In your example, the locksmith has so much experience, its easy for him to fix locks, so not much effort it required by him. But we do make this correlation between effort and time; so more time spent == more effort to our brain. That needs to change.

Nick Szabo has some writings on the economic shift to hourly wages and proof of work; because of the local knowledge problem (nobody can be an expert on everything, lots of information is hidden or inaccessible or tacit, and it's extremely difficult to determine value), looking at the labor or work which went into a product or service can be a simple fast heuristic for estimating the value of something - since if it was not at least that valuable, the actors who produced it and have more local or tacit knowledge would stop producing it.

I have read somewhere (it could be apocryphal, although it makes sense) that for this very reason barbers tend to snip their scissors in the air a lot - to give off an impression that there's more work being done than there actually is...

I can confirm this happens in high end hairdressers.

I have never spent a lot on haircuts, and a few years ago when I was going from long to short hair (for a job interview), my mum offered to pay for an expensive haircut for me. The haircut was not really any "better" than many of the cheap ones I had paid for myself, but the hairdresser spent a lot more time, and there seemed to be a lot more faffing about, with no real purpose as far as I could see.

Most of the places I had gone to obviously needed a bit higher throughput to keep the money coming in.

As a friend of mine told me, "I don't get it how my haircut can take 5 minutes and cost 25 [nevermind the currency here], while my wife sits there for 1.5h paying 150" - so I pointed out that HER haircut is actually cheaper :) Profound? Perhaps... On the subject? Quite so! ;)

It isn't totally irrational, it's merely measuring the only metric we can measure objectively, in the usual way it's measured. The fact the measurement function is exactly backwards is not obvious; in fact, it's entirely reasonable to expect to pay more for taking up more of someone's time.

Locks are actually a very good (pathologically good?) example of this, because we usually have no idea how well and how often they succeeded and a single failure can be catastrophic. Therefore, it's very hard to tell how good of a job the locksmith who installed or fixed it did without being a locksmith yourself. Compare cars: With a car, you drive it around pretty often, and you get a feel for how it handles and smells and sounds relative to the baseline established when you first got it. There's a constant evaluation of factors relevant to how the car is actually doing. With a lock, if the lock is put in well and functioning properly, the successful evaluations are mostly unnoticed unless you have a camera watching the lock 24/7.

I think it's more complicated than this Locksmith example. I think we are so used to being ripped off by "experts", many with a lot of spinach behind their names; We start to think everyone is trying to make the most amount of money they can out of a situation(usually a bad situation). I have no problem paying someone for a job well done--if they do it quick all the better. The problem I have encountered is the expert did the job, but it was a half ass job and their mistake didn't show up until later. I'm now kind of jaded. One other thing about experience. I have found experience doesn't matter quite as much as I thought it did in a lot of professions--especially the professions that are a mix of science, and art--like medicine, and yes Programming. A little experience, but still double checks their work, and is staying current--Gold mine! The pillar of their profession, with an ego to match--I run! (I noticed someone brought up the mechanic and the hammer story. A stuck pinion on a starter sometimes responds to a hammer blow. I used to position a long dowel(broom handle) on the stuck starter through the engine bay and whack the dowel with a hammer.) Oh yea, I have found that people who don't overcharge(whatever that even means anymore) are well liked amoung their peers, and customers.

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