Professor Gorvett points to an article in the Raliegh News & Observer discussing the team that sets the petrol prices for one chain of convenience stores in the southeast.
Sodini acknowledged that gas prices can be confusing — he sometimes has trouble explaining all of the factors involved to his own board of directors, he said.[...]
But, he said, it’s competition that keeps the gas companies from gouging. “If I’m overcharging, [consumers] are not going to pay that if they know they just passed something cheaper,” he said.
He said he knows his efforts to defend against accusations of gouging are sometimes futile. “You’re never going to convince them that you’re not shafting them,” he said, “and [I] recognize they’re not going to believe a word of it.”
I remember those no-win discussions from back when I worked with credit scoring. You know that there’s nothing inappropriate going on because you’ve worked inside the black box…but a few folks just won’t believe a word you say.
Annoyingly, the article just provides the briefest of tastes of what that team goes through in setting the prices at the pump. That’s a process I’d love to experience first hand, just out of an appreciation of the sheer beauty of the complexity of the problem.