Moviegoers are regularly astounded by the astronomical prices they’re asked to pay for popcorn. They know that the actual cost of making popcorn at home can be measured in pennies. Then why is the price so high? On the contrary, the price of theater popcorn is actually very low – lower than the cost of home-produced popcorn for most moviegoers. If it weren’t, more movie patrons would be seen smuggling popcorn into the theaters, which very few do.
In a new book, Why Popcorn Costs So Much at the Movies, And Other Pricing Puzzles, economics and management professor Richard McKenzie offers an unexpected answer why the movie snack might be just slightly overpriced. It has to do with a U.S. Supreme Court antitrust decision handed down in 1948 − the full connection between that court decision and the price of theater popcorn is explained.
McKenzie goes on to unravel an array of pricing mysteries we encounter every day − why so many prices end with “9” (as in $2.99 or £179), why ink cartridges can cost as much as printers, and why men earn more than women. He shows how the terrorists of 9/11 still kill people every day, because their attacks distorted the perceived risks and relative prices of air vs. automobile travel. McKenzie also explores the unintended consequences of well-meaning efforts to spur the use of environmentally friendly fuels: starvation among millions of people around the world and the destruction of rain forests in Malaysia and Indonesia.
How can these things be? The answers are not so straightforward. Why Popcorn Costs So Much at the Movies shows that the real reasons are sophisticated and surprising − and in Mckenzie’s hands, both informative and entertaining. The reader won’t need a degree in economics to enjoy this book, just an armchair and an inquiring mind.
Richard McKenzie is Professor of Enterprise and Society at the University of California, Irvine. He has written a number of books on economic policy, most notably on the Microsoft antitrust case in the United States. His commentaries have appeared in newspapers all over the US and he produced the award-winning documentary film Homecoming: The Forgotton World of America’s Orphanages. McKenzie is a frequent columnist for the Wall Street Journal.
The author is available for interview.
Richard B. McKenzie, tel [949] 463-2604, mckenzie@uci.edu.
Why Popcorn Costs So Much at the Movies, And Other Pricing Puzzles
2008. Approx. 335 p. Hardcover. €22.95, $27.99, £17.50
ISBN 978-0-387-76999-8