22.3.04

RISING OPPORTUNITY COSTS
It's pretty clear that grocery checkout clerks are going to go the way of bank tellers. They won't disappear altogether, but there will be many fewer of them. Grocery employees will have to add value to the customer's experience, not simply process their purchases.
Thus does Virginia Postrel hail the introduction of self-serve checkout, something she compares with automatic cash dispensers. Although it makes sense to substitute toward machinery rather than more expensive labor (either because human capital is more valuably deployed in tasks more challenging than swiping goods past a scanner, or because school-leavers lack the intellectual or the social skills to be checkout people) the effect is to raise the cost to the consumer, particularly for idiosyncratic and high-valued transactions. Ms Postrel's illustration of the supervisor-assisted purchase of a controlled substance is a case in point. Get behind a few of those and practice your anger-management skills. Something similar is happening at banks and at post offices. To the extent that the cash dispensers work properly, account holders can do routine deposits and withdrawals more quickly. That means the people waiting for the one or two tellers left inside the bank are more likely to be doing complicated transactions. At the post office, the line out the door is a line of people each of whom requires more attention than a simple purchase of first class stamps. Is the net effect on economic welfare positive or negative, with greater waiting times quite likely being imposed on the more complex transactions while the routine transactions have become more convenient?

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