Fly under the bridge, Baby

Dartmouth economist and former adviser to POTUS, Andrew Samwick, awards Voxies to journalists who write 'exceptionally lucid and thoughtful contributions to the public discussion'.

The Fly Under the Bridge Academy hereby inaugurates the Milton--in honor of the man Paul Krugman recently described as, 'possibly the most brilliant communicator of economic ideas to the general public that ever lived'--to be awarded to journalists who exhibit even minimal understanding of some simple principle of economics.

The winner, in the category, Knock Me Over With a Slice With Three Toppings, is Seattle Times reporter Robert L Jamieson Jr for this column:

Seattle's famous Pagliacci Pizza chain is getting dinged on local blogs because of a delivery policy that critics believe avoids certain areas based on class. The nicer the address, the thinking goes, the greater the likelihood of getting a piping hot pepperoni.

....Fast-food companies in cities across the country have found themselves in the cross hairs of controversy for not delivering to certain addresses. Their reasons range from valid crime concerns to, yes, even out-and-out bias.

I had a hunch Pagliacci wasn't getting a fair shake. A call to Pagliacci headquarters in Seattle brought me in touch with a nice guy named Sam. I told him that Domino's delivers to more areas of West Seattle.

"Domino's for quality of food is way lower on the scale," said Sam, who then was quick to get his boss on the horn.

Long story short, it's true: Pagliacci, which has a kitchen that is mostly for takeout and delivery on West Seattle's California Avenue, doesn't deliver to certain parts of the neighborhood.

But the company says its reasons have nothing to do with class and everything to do with time.
Call it the seven-minute rule.

The company aims to deliver to areas it can reach with ease in about seven minutes from any of its 15 delivery centers throughout greater Seattle.

To do this well, Pagliacci must set boundaries.

....For Pagliacci, it all comes down to "maintaining food freshness."

From a business perspective, I see where the company, with 600 employees, is coming from. If Pagliacci officials rapidly expanded their boundary-delivery areas, they'd risk ruining a successful business model. Drivers would have to go farther out. Deliveries would take longer. Food would be less appetizing when it arrived. The brand could take a bite.

....Econ 101 explains this phenomenon: the point of diminishing marginal returns.

This occurs when a company gets a smaller slice of the pie for all its efforts.

Pagliacci isn't out to dis anyone. The pizza company just discriminates when it comes to delivering a cold and soggy pie to your doorstep.

No one wants a bum pie -- or rap.

Mr. Jamieson's Milton is awarded even though he misstates, slightly, the principle in question--The Law of Diminishing Returns is less the explanation than that a business will try to maximize its revenue up to the point that the marginal benefit from selling one more pizza is exceeded by the marginal cost of so doing. But, in the world of journalism, we take what we can get.