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Comment by minimaxir | Hacker News Reader

Price discrimination only works if people can't easily identity that discrimination is in play. Otherwise, there will be backlash, which is what has been happening on Twitter this morning.

It's also worth nothing that price discrimination really doesn't work if it can easily be gamed. Many people create secondary Facebook profiles for Tinder; this implementation just ensures that there will be a lot more "27 year olds" on the service.

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Movie theaters very clearly show the different prices for different groups (students, seniors, etc.) and no one seems to mind. Same with zoos, museums, etc.

don't those also require the presentation of a valid student id, or some form of senior citizen id ?

student ID-- yes. senior citizen ID is probably just a drivers license with a DOB on it.

not sure if you were agreeing or disagreeing with my point?

Also, people are generally better with price CUTS for those perceived as disadvantaged, e.g. the elderly, students, etc. People are also GENERALLY ok with short-lived extra fees for the young and/or provably risky: think credit cards, rental cars, hotel rooms(?). I don't think I've ever seen a case of a price HIKE, though; stereotypically I imagine a grumpy group of older people.

> Price discrimination only works if people can't easily identity that discrimination is in play.

While this specific pricing model seems odd to me, I don't think I agree with your general claim. I think everyone understands the iPhone product line, with different prices for different amounts of storage space. As far as I know, that works really well for Apple, yet it would be difficult to have a more blatant example of price discrimination.

edit: There are several people claiming that price discrimination requires the products to be completely identical. I maintain that is not how the term is used in economics. I replied with more detail here: https://news.ycombinator.com/item?id=9135084

I think what he means is charging different prices for different users for the same product.

I wonder if it matters that Tinder is a service not a product. In MS Office it is possible for two people to have the same user experience. But on Tinder the people that you interact with are the product. Legally this distinction is probably irrelevant.

"Price discrimination" means charging different users different prices for the same product/service. Apple charging different prices for different amounts of storage space is not price discrimination.

"Price discrimination" is widely used to refer to identical or nearly identical products whose cost of production is nearly identical despite being offered at significantly different prices.

Price discrimination is when a business charges different prices to different groups of consumers for the same product or service.

Charging different prices for similar goods is not pure price discrimination.

The widely accepted and used definition in economics refers to products that are identical or nearly identical, or more specifically, whose functions and costs of production are nearly identical. Student editions of software, for instance, are often functionally limited, but it is widely listed as an example of price discrimination. Some econ textbooks will make a distinction of "pure price discrimination," which requires the products to be literally identical. Note that the identity function for products is not always obvious.

I maintain that the iPhone's storage pricing is a clear example of price discrimination.

>this implementation just ensures that there will be a lot more "27 year olds" on the service.

which ultimately hurts the service as nobody will be able to know who is 27 and who is older than 27

I predict that people will put their real age in their bios. Many older people already do this today.

Yes exactly. This is a really badly designed implementation of a pricing tier strategy.

It also seems likely that by incentivizing users to lie about their age, Tinder will create an entire zone of fake ages between something like 25-27, where users do not want to be grouped in with all of the "27 year olds" so they go year(s) lower. Thus, eliminating user trust for ages of anyone at numbers approaching 27.

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