Often bar owners will require that patrons stand in a line to get a wristband entitling them to pay a preferred price for drinks if they arrive early to the bar

The wristbands are typically tamper- resistant and can be easily identified if patrons have been switching wristbands with other customers. What is the bar owner concerned about and why does he make his patrons wear these bands?


The bar owner wants to increase business activity at a time when many customers may not be interested in showing up to the bar. This is typically in the early evening hours before sundown. Customers who may be sensitive to drink prices but indifferent as to when they patronize the bar may be willing to wait in the line to get the special hand bracelet. If the bracelets could be easily taken off then those who arrived early could charge a small price to those who arrived later so that they too could enjoy the lower price of bar drinks. The tamper-resistant nature of the wristbands keeps this transfer of producer surplus to the late-arriving customers from taking place.

Economics

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