The market for experts

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… seems broken. This is my impression after looking at a new website Expert Insights that allows people to book hour long conversations with famous people. Here is the Slate writeup.

It looks like economists feature prominently. There’s Steve Levitt, Gary Becker, and Jeff Miron. We don’t know Levitt’s rate but Becker’s is $5000 per hour while Miron is happy to chat for $400 per hour. Stephen Dubner is also there at $3500 per hour. Given some of the markets Levitt and Dubner write about I guess we would call them ‘high end.’ What’s going to happen if some politician is found out to have purchased a few hours of expert time?

But here is the thing: it is all one way. These rates apply regardless of who these people are talking to. Now if these economists had influence on the business plan for the site itself, they would adjust their price based on who they are talking to. Levitt may charge less to chat with Mitt Romney or someone like that. Dubner chatted with me for an hour recently for free but then again I didn’t charge him either. And Becker can’t tell me his utility doesn’t change between talking with students, business people and movie stars. There’s deadweight losses all over the place.

Of course, if these people want to talk with each other they can just split the difference. I wonder what happens when Levitt and Becker run into each other in the Chicago hallway?

2 Responses to "The market for experts"
  1. Great post.

    I pay 416.6667  Iunits to Joshua Gans [Fn1]
    0 Iunits to Garry Becker
    0 Iunits to Jeff Miron
    0 Iunits to Dubner
    0 I units to Steve Levitt

    [Fn1] Since the informaton exchange is half-open, I know that Joshua Gans exchanged 1 hour of his time for $5000. One Iunit equates to 83.3333. Time is a common real resource constraint. My I-payment represents the time I spent on  Joshua Gans’ public information.

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