The Auction/Bidding Metaphor: Geico and Roy Childs
Geico ad beautifully illustrates the problem Roy Childs pointed out to me 40 years ago.
“You economists are so careless in your thinking. You use so many metaphors without really thinking about them.”
So said my friend, the late Roy A. Childs, Jr., in one of the first conversations I ever had with him. This was early in our friendship, while I was in graduate school at UCLA.
Already a strong believer and defender of economics, I reacted defensively. “Ok,” I said, “name one metaphor we use that is unjustified.”
“Auctions and bidding,” he said. “You economists often say ‘So consumers bid up the price of goods.'”
“What’s wrong with that?” I said.
“What’s wrong?,” said Roy. “What’s wrong is that they don’t.”
I went silent for a few minutes and then noodled it over the next few days. I decided he was right. I quit using that metaphor. Maybe I’ve slipped a few times, but very few.
Here’s a good way to remember not to use the auction metaphor: the Geico ad about how auctioneers would make bad sales clerks.