Living Economics

The next time you are standing in line in a supermarket waiting for service, you might consider the allocation issue being worked out before you. It is not unlike the allocation issues presented and solved in different economic systems.

There are 12 checkout lines at my neighborhood Kroger's. When I approach checkout with my goodies, I choose the shortest line to reduce the opportunity cost of waiting. Other shoppers do the same. Just as Adam Smith and the Classical theorists would have predicted, the whole process is well organized even though there is no "director" there to assign shoppers a line to join. Indeed, as if by an "invisible hand", shoppers move spontaneously to the line where their "time price" is lowest. There are, of course, unwritten but shopper-enforced rules about wedging into line ahead of others that serve to regulate the process and insure fairness of treatment, just as market activities are regulated by laws.

Several decades ago, before automatic tellers, I frequented an old-fashioned bank. It employed a smiling, well-dressed man to meet and greet patrons in the bank lobby and direct them to one of five teller lines. His smile evaporated if any patron challenged his judgment by going to a line other than the one he assigned. He was a "command economy" figure. An official from the old Soviet Union would have been pleased at his role in directing customers efficiently to the teller resources available.

There are combinations of market and command mechanisms possible, of course. I recently flew Northwest Airline from Los Angeles to Memphis. There were hundreds of people assembling at the check-in for several Northwest flights. The main Northwest Check-In counter had maybe 25 stations. I joined the main, serpentine line folding back and forth in front of the check-in stations.

Northwest provided a young lady at the head of the line to direct passengers. Her task was not only to point to an open station for the next passenger. She also determined quickly if I needed a ticket or, since I did not, by a brief scan of my ticket whether I was "check in - seat assignment" only, or "luggage check in" only, first class or coach, domestic or international flight. She directed us all to the first available specialized station.

The young lady was a "modified command" figure. She did not order passengers in the strict sense, but suggested that an appropriate station was open. Her orders/suggestions as to which station would best serve each passenger's needs added some allocational efficiency to the queue.

Government agencies could benefit from using a modified command system in managing waiting lines in serving citizens. For example, the Memphis county auto title department is notorious for making citizens wait unnecessarily long for businesses that could be taken care of in one minute (such as picking up a form). Instead, every citizen must wait in a line in the order dictated by the number ticket machine regardless of the nature of their business. A roving clerk could greatly reduce average waiting time by directing customers to express or regular lines depending on the expected service time of their businesses. By thus stratifying the process, greater efficiency could be achieved without compromising fairness.

Waiting line management employs allocational mechanisms much like those for different economic systems. All these mechanisms seek to combine equity with efficiency in allocating scarce resources.