The Complexity of Subscription Services

Insurance forms that make no sense. Subscriptions that can’t be cancelled. A never-ending blizzard of automated notifications. Where does all this sludge come from — and how much is it costing us? (Part one of a two-part series.)

• SOURCES:
  • Benjamin Handel, professor of economics at UC Berkeley.
  • Neale Mahoney, professor of economics at Stanford University.
  • Richard Thaler, professor of economics at The University of Chicago.

• RESOURCES:
  • "Selling Subscriptions," by Liran Einav, Ben Klopack, and Neale Mahoney (Stanford University, 2023).
  • "The ‘Enshittification’ of TikTok," by Cory Doctorow (WIRED, 2023).
  • "Dominated Options in Health Insurance Plans," by Chenyuan Liu and Justin Sydnor (American Economic Journal: Economic Policy, 2022).
  • Nudge (The Final Edition), by Richard Thaler and Cass Sunstein (2021).
  • "Frictions or Mental Gaps: What’s Behind the Information We (Don’t) Use and When Do We Care?" by Benjamin Handel and Joshua Schwartzstein (Journal of Economic Perspectives, 2018).
  • "Adverse Selection and Switching Costs in Health Insurance Markets: When Nudging Hurts," by Benjamin Handel (National Bureau of Economic Research, 2011).

• EXTRAS:
  • "People Aren’t Dumb. The World Is Hard. (Update)" by Freakonomics Radio (2024).
  • "All You Need is Nudge," by Freakonomics Radio (2021).
  • "How to Fix the Hot Mess of U.S. Healthcare," by Freakonomics Radio (2021).
  • "Should We Really Behave Like Economists Say We Do?" by Freakonomics Radio (2015).