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She Said, Z Said: The Science of Craigslist, At a Discount

By Leslie Dinaberg and Zak Klobucher, Noozhawk Columnists | @lesliedinaberg | Published on 10/15/2012

Whether you're biding your time or bidding on it, recognizing the right price is worth figuring out

Z: I am always startled to learn that the value of anything is exactly the price that another person is willing to pay for it.

She: Plus shipping and handling. Although, why it costs $9.95 to handle anything is beyond me.

Z: Don’t touch my stuff so much, and save me a few bucks. Am I right?

She: Why so interested in the price of things today?

Z: Because Craigslist — even though it’s filled with flakey buyers and sellers — is a magical playground of economic theory.

She: I think you have much more fun there than you should. Are you really selling stuff, or have you been hanging out in the oddly creepy personals section?

Z: Those are fun for about five minutes, but I don’t really have extra time for the shower you need to take after reading them. No, I’m talking about the mystery of how you decide to price things on Craigslist.

She: Can’t you just put everything on there for free? Really all I want is a clean garage.

Z: I know, which is why I do all the Craigslisting in the family. It takes the same amount of time and energy to give away something for free as it does to put a price on it. Why not make a few dollars?

She: Is the garage clean?

Z: Soon enough.

She: That’s why.

Z: I got rid of the old TV this week.

She: That’s a start.

Z: It’s not a flat panel, it’s smallish, and it wasn’t that expensive to begin with. I assumed it was scrap, so I started off by asking for $20.

She: Why not just scrap it?

Z: Because it seems like it’s better for the environment to find someone who still has a use for it. I lowered it to $10, and then $5, and that’s when I started to get calls.

She: So the value of a small, old TV is $5.

Z: That’s what I thought, until the guy who actually bought it insisted he pay $10.

She: Huh?

Z: He needed the exact cable inputs that this TV had in the back, and said they were hard to find. He was also buying it for some company or department, and didn’t want to rip me off since it wasn’t even his money.

She: That’s crazy talk.

Z: So apparently the value of an old TV varies, depending on who needs it. We didn’t need it, so you wanted to scrap it. He needed it, so he wanted to pay what was fair.

She: Thank you, Milton Friedman.

Z: Who?

She: While you were doing plays in college, I took Econ 101.

Z: Hard to believe.

She: For you and me both.

Z: My favorite Craigslist pricing was when I was trying to sell an old sofa. I started at $50, but nobody wants a $50 sofa. It must be awful. As soon as I raised the price to $100, it sold pretty quickly.

She: Because a $50 sofa is probably full of moth holes, and possibly even moths, while a $100 sofa is actually a great deal.

Z: Kind of like all of those “great deals” you get on eBay.

She: Exactly. One pair of $150 shoes is a lot of money. But three pairs of $150 shoes for $60 each is a fabulous deal.

Z: If only we were living in a world of eBay economics instead of Craigslist cash flow.

She: Maybe I can find a book about how to do that on Amazon.com.

Z: Yes, dear.

— Share your economic theories and bidding techniques with She and Z by emailing .(JavaScript must be enabled to view this email address). Follow She and Z on Twitter: @lesliedinaberg. Click here for previous She Said, Z Said columns.

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She Said, Z Said: The Science of Craigslist, At a Discount

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