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Sanya12364 Posts
On November 23 2010 12:57 html wrote:
If at least you understand they could maximises their profit in an environment without discrimination, I'm ok with that.
In an insurance market, the market segments because competition exists. Firms would price different coverage packages at differing pricing points and the segmentation would naturally occur in that men would select more coverage (higher premiums) and women would select less. Firms would carve up the marketplace like that or go out of business.
There is no "profit maximization" without discrimination unless there is government intervention.
Then there is moral hazard.
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On November 23 2010 12:54 micronesia wrote:Show nested quote +On November 23 2010 12:52 WhuazGoodJaggah wrote:On November 23 2010 12:48 micronesia wrote:On November 23 2010 12:46 WhuazGoodJaggah wrote:On November 23 2010 12:44 micronesia wrote:On November 23 2010 12:42 WhuazGoodJaggah wrote:On November 23 2010 12:27 micronesia wrote:
If someone gave me and my sister a golf videogame for the Holidays, we both got the same product. My sister would play single player for 15 minutes and then never pick the game up again (even that's an exaggeration lol). I would play for 100 hours and use their free online servers a lot and whatnot. I am costing the company more money, I got a lot more out of it, etc. But, my sister and I were both offered the same product. Charging me more for the game because men are more likely to play golf online, and charging my sister less because women typically play for 15 minutes and then put the game down permanently is analogous to this insurance debate. the game is a product the usage of the online service is a "service" the insurance is also a service can't mix all that up. I'm fine with calling it a service. I don't think that affects my point though. it does a lot, because you own the product but you use the service. so it does not matter at all how many hours you play a golf game offline. all you can compare is the online service you use you didnt buy as a product but as a service. And how does this affect the point I was making? I am going to use the service more than my sister... that doesn't mean I was offered a different service than her. as I said you mixed up things you can't mix up like this and it was product and service. you said you and your sister bought the same product, thats correct. then you said you should be charged more because you cost the company more because you also use their online SERVICE. I still don't see how this somehow invalidates or changes my ultimate point (or are you not asserting that?) My sister and I were both granted access to the same 'free' service as a result of purchasing the product. The fact that I'm using it more does not mean I was offered something different from my sister.
I think it's a bad example as the product (the gane) is not needed at all. You compare a service you payed for along with a product. That service is not free as it is a mix calculation. All this makes the example bad and overcomplicated mostly because you mixed in an unneeded product.
My example would be the price for the internet access. I would charge men more because they tend to download way more pron and produce a lot more traffic because of it. That would also be sexist but eventually increase profit.
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I finally finished reading the whole thread, and am of the opinion that this kind of discrimination should not be accepted.
What if banks, based on statistical evidence that males more reliably repay their loans than females, decided to offer different interest rates to customers? A guy walks in and gets his loan at 6%, but when a female of the same demographic walks in she is charged 7% instead, simply based on the tendencies of her gender, despite having a better credit record than the aforementioned male. People may complain that this is sexist, but as the bank you can tell them to fuck off because you have statistical evidence to back up your policy so it's legit.
Would this kind of policy fly? I highly doubt it, feminist groups would be up in arms overnight. I don't see how this is any different to the insurance dilemma.
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On November 23 2010 13:02 WhuazGoodJaggah wrote:
I think it's a bad example as the product (the gane) is not needed at all. You compare a service you payed for along with a product. That service is not free as it is a mix calculation. All this makes the example bad and overcomplicated mostly because you mixed in an unneeded product.
My example would be the price for the internet access. I would charge men more because they tend to download way more pron and produce a lot more traffic because of it. That would also be sexist but eventually increase profit.
Of course, everything is a bad example to some degree.
The internet service *can* fairly charged after the fact, and based on usage. They do it in many places
Insurance is designed specifically to not be fairly charged after the fact, because the whole point is that people can't afford the huge lump of damage they do at that point in time. So they get into a risk-sharing pool with others.
It's almost backwards.
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On November 23 2010 13:00 micronesia wrote:Show nested quote +On November 23 2010 12:58 Kwidowmaker wrote:On November 23 2010 12:44 micronesia wrote:On November 23 2010 12:42 WhuazGoodJaggah wrote:On November 23 2010 12:27 micronesia wrote:
If someone gave me and my sister a golf videogame for the Holidays, we both got the same product. My sister would play single player for 15 minutes and then never pick the game up again (even that's an exaggeration lol). I would play for 100 hours and use their free online servers a lot and whatnot. I am costing the company more money, I got a lot more out of it, etc. But, my sister and I were both offered the same product. Charging me more for the game because men are more likely to play golf online, and charging my sister less because women typically play for 15 minutes and then put the game down permanently is analogous to this insurance debate. the game is a product the usage of the online service is a "service" the insurance is also a service can't mix all that up. I'm fine with calling it a service. I don't think that affects my point though. I had to think about your post for a bit. I have a couple things to say about why it isn't a great analogy. First, you enter an agreement with insurance companies to pay them at regular intervals and receive a payment when you are in an accident. There is no formal agreement in your golf game example. The free online servers are a freebie you get with the game - your money is spent to purchase the game, not maintain an agreement. There are many cases where online service is discontinued and in breach of no contract. Second, reliable statistics do not exist in your example while they do for car insurance. Even if there are good statistics on who plays games, and even what genre, I contend that the specific games are still in question. Some FPS players play CS, others BF, others CoD, some all three, and some play a game until the next big one comes out. I don't see why we can't be more specific with my example to make it comparable. 1) Purchasing the golf game constitutes a legal contract with the company where they promise to let you have access to their free online servers for a minimum of 1 year. 2) Extensive research has been done by the videogame company's actuaries to evaluate who is "high risk" for using the free online servers a lot.
Then let me offer a third: Insurance payouts are discrete, sparse and large drains. Online service use is a continuous and small drain. It is possible to allot a certain amount of playtime, but not to allot a certain amount of accidents.
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On November 23 2010 13:04 FuRong wrote:
I finally finished reading the whole thread, and am of the opinion that this kind of discrimination should not be accepted.
What if banks, based on statistical evidence that males more reliably repay their loans than females, decided to offer different interest rates to customers? A guy walks in and gets his loan at 6%, but when a female of the same demographic walks in she is charged 7% instead, simply based on the tendencies of her gender, despite having a better credit record than the aforementioned male. People may complain that this is sexist, but as the bank you can tell them to fuck off because you have statistical evidence to back up your policy so it's legit.
Would this kind of policy fly? I highly doubt it, feminist groups would be up in arms overnight. I don't see how this is any different to the insurance dilemma.
That is a very good analogy! And it makes perfect sense. 
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On November 23 2010 13:04 FuRong wrote:
I finally finished reading the whole thread, and am of the opinion that this kind of discrimination should not be accepted.
What if banks, based on statistical evidence that males more reliably repay their loans than females, decided to offer different interest rates to customers? A guy walks in and gets his loan at 6%, but when a female of the same demographic walks in she is charged 7% instead, simply based on the tendencies of her gender, despite having a better credit record than the aforementioned male. People may complain that this is sexist, but as the bank you can tell them to fuck off because you have statistical evidence to back up your policy so it's legit.
Would this kind of policy fly? I highly doubt it, feminist groups would be up in arms overnight. I don't see how this is any different to the insurance dilemma.
Banks have your credit rating, which, if females were worse at paying debts, would be worse for females on average. So yes, they probably do discriminate based on gender but they go even further in depth. Insurance companies can't get more than they can legally ask you.
In short, your example supports the opposite side than the one you're claiming it supports.
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On November 23 2010 13:04 FuRong wrote:
I finally finished reading the whole thread, and am of the opinion that this kind of discrimination should not be accepted.
What if banks, based on statistical evidence that males more reliably repay their loans than females, decided to offer different interest rates to customers? A guy walks in and gets his loan at 6%, but when a female of the same demographic walks in she is charged 7% instead, simply based on the tendencies of her gender, despite having a better credit record than the aforementioned male. People may complain that this is sexist, but as the bank you can tell them to fuck off because you have statistical evidence to back up your policy so it's legit.
Would this kind of policy fly? I highly doubt it, feminist groups would be up in arms overnight. I don't see how this is any different to the insurance dilemma.
Banks all ready discriminate based on a more significant variable than gender: credit rating.
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Sanya12364 Posts
On November 23 2010 13:04 FuRong wrote:
I finally finished reading the whole thread, and am of the opinion that this kind of discrimination should not be accepted.
What if banks, based on statistical evidence that males more reliably repay their loans than females, decided to offer different interest rates to customers? A guy walks in and gets his loan at 6%, but when a female of the same demographic walks in she is charged 7% instead, simply based on the tendencies of her gender, despite having a better credit record than the aforementioned male. People may complain that this is sexist, but as the bank you can tell them to fuck off because you have statistical evidence to back up your policy so it's legit.
Would this kind of policy fly? I highly doubt it, feminist groups would be up in arms overnight. I don't see how this is any different to the insurance dilemma.
You can capture that in credit ratings.
As for loans, US government is already doing that with respect to race. About 20 years ago there was a home ownership "gap" that the statisticians noticed. There was an effort to close that "gap" by forcing banks to "close" the "gap" by lending to less qualified minorities. It has not had a happy outcome.
Homeowners need to buy houses they can afford after they develop the good habits that earn them a good credit rating. Anything to "help" the process only pushed people into ownership when they weren't ready.
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On November 23 2010 13:06 Typhon wrote:Show nested quote +On November 23 2010 13:02 WhuazGoodJaggah wrote:
I think it's a bad example as the product (the gane) is not needed at all. You compare a service you payed for along with a product. That service is not free as it is a mix calculation. All this makes the example bad and overcomplicated mostly because you mixed in an unneeded product.
My example would be the price for the internet access. I would charge men more because they tend to download way more pron and produce a lot more traffic because of it. That would also be sexist but eventually increase profit. Of course, everything is a bad example to some degree. The internet service *can* fairly charged after the fact, and based on usage. They do it in many places Insurance is designed specifically to not be fairly charged after the fact, because the whole point is that people can't afford the huge lump of damage they do at that point in time. So they get into a risk-sharing pool with others. It's almost backwards.
Thx for pointing that out.
The problem for insurance companys to accuratly charge you is the key point. To isolate that key problem its good to have a simple "counter" example to show it. The product service mixture covers to much to extract that info easly thats why I pointed that out,
Personally I have no problem with the sexism used to determine how much I need to pay. They have to start somewhere. I do pay very little for health insurance for example because I almost never go to the doctor and I dont take any medicine at all. As long as such factors weigh in good enough im fine with the discrimination by gender ethnicity or penis length or whatever,
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On November 23 2010 12:57 html wrote:
If at least you understand they could maximises their profit in an environment without discrimination, I'm ok with that.
I understand the concept, but the main argument of the free market system is that it is the most efficient.
Imagine all companies are out to make money. Actually, you don't have to imagine. it's true.
Now, imagine the government says, okay, you guys all have to charge *exactly* the same price.
Then, as company A, I could, say, charge exactly the same as everyone else, but then I offer, say, a free manicure package as a bonus signup. To entice the lower-risk women category. Or I could hire advertising experts who specialize in women-focussed advertising. Now, I have a bunch of women customers, and I'm making a huuge profit off of them. Whenever you artificially fix a price at what the market doesn't want, it's an inefficiency that smart people will make money off of.
You can't just "fix" a price of anything without ramifications, and the market dynamics will still work. Think about that a little. Or read some books on economics. They usually have great real-life examples.
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I think Vanished has a good point - statistics of this nature could then also state that a certain group of people can't have a loan because they are statistically in a group of people who default more often.
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On November 23 2010 13:15 Norway wrote:
I think Vanished has a good point - statistics of this nature could then also state that a certain group of people can't have a loan because they are statistically in a group of people who default more often.
Sure, but TanGeng has a better counterpoint
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On November 23 2010 13:15 Typhon wrote:Show nested quote +On November 23 2010 12:57 html wrote:
If at least you understand they could maximises their profit in an environment without discrimination, I'm ok with that. I understand the concept, but the main argument of the free market system is that it is the most efficient.
That depends a little on what you cover with "efficiency". Generating the most money certanly, yes.
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On November 23 2010 13:15 Norway wrote:
I think Vanished has a good point - statistics of this nature could then also state that a certain group of people can't have a loan because they are statistically in a group of people who default more often.
The bank does do credit checks on you though. They can get reasonable evidence of your ability to pay based on your credit card payments, your current income, your past loan payments. That's the only reason why they can assess the risk of lending you money.
The insurance company usually doesn't have these statistics because the majority of people don't come in with a huge history of crashes on their record. So they have to guess.
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Sanya12364 Posts
On November 23 2010 13:15 Norway wrote:
I think Vanished has a good point - statistics of this nature could then also state that a certain group of people can't have a loan because they are statistically in a group of people who default more often.
But you don't need to go purely by the statistics. That's what a face to face interview is for. If the banker decides that it is worth his time, he can meet his prospective client and try to get feel personally. Then the banker will have more information than what his statistics tell him. The same principle may go towards rejecting a potential client whose statistics are positive but gives off an irresponsible feel.
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On November 23 2010 13:19 WhuazGoodJaggah wrote:Show nested quote +On November 23 2010 13:15 Typhon wrote:On November 23 2010 12:57 html wrote:
If at least you understand they could maximises their profit in an environment without discrimination, I'm ok with that. I understand the concept, but the main argument of the free market system is that it is the most efficient. That depends a little on what you cover with "efficiency". Generating the most money certanly, yes.
not arguing that point  I'm just pointing out that it's hard to design a self-balancing system just by fixing prices. It's a subject that many people smarter than me have failed to come to a good solution for.
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So this is a little off topic, but it talks about the rise of men in an age of feminism and what role we have to play. It is from the website artofmanliness.com. I hope this can be insightful to some:
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Can't blame the company, can only blame other men for being bad drivers.
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On November 23 2010 13:14 WhuazGoodJaggah wrote:Show nested quote +On November 23 2010 13:06 Typhon wrote:On November 23 2010 13:02 WhuazGoodJaggah wrote:
I think it's a bad example as the product (the gane) is not needed at all. You compare a service you payed for along with a product. That service is not free as it is a mix calculation. All this makes the example bad and overcomplicated mostly because you mixed in an unneeded product.
My example would be the price for the internet access. I would charge men more because they tend to download way more pron and produce a lot more traffic because of it. That would also be sexist but eventually increase profit. Of course, everything is a bad example to some degree. The internet service *can* fairly charged after the fact, and based on usage. They do it in many places Insurance is designed specifically to not be fairly charged after the fact, because the whole point is that people can't afford the huge lump of damage they do at that point in time. So they get into a risk-sharing pool with others. It's almost backwards. Thx for pointing that out. The problem for insurance companys to accuratly charge you is the key point. To isolate that key problem its good to have a simple "counter" example to show it. The product service mixture covers to much to extract that info easly thats why I pointed that out, Personally I have no problem with the sexism used to determine how much I need to pay. They have to start somewhere. I do pay very little for health insurance for example because I almost never go to the doctor and I dont take any medicine at all. As long as such factors weigh in good enough im fine with the discrimination by gender ethnicity or penis length or whatever,
First of all, I think your arguments were horrible, especially the useless "product vs service" one against micronesia. You jumped on something that wasn't even significant in relation to this discussion to begin with no matter how hard you tried to blow it out of proportion.
Secondly, would you really agree to be discriminated just because you are 5.6, left-handed and major psychology? If you have no problem with sexism then you don't belong here because this whole debate revolves around "sexism or not". If this was your essay you would get an F for failing to address the subject.
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