Although arguably at polar opposites of the “enjoyment” spectrum, visiting the airport and visiting Disneyland have one key thing in common: when you’re there – you spend most of your time waiting in line.

Have you ever noticed how really long lines move? It’s a great study of human nature. Objectively thinking, the most efficient way for lines to move is for everyone to take tiny marching steps in unison, steadily advancing and keeping the line moving – but that’s not how it works. When waiting in line – most of the time, everyone is standing still. Then, as gaps start to form, a ripple of movement travels through the line with each person progressing 3-5 feet all at one time at a time – it’s like a snake!

The reason it works like this is because when it comes to moving forward in line the “fixed costs” are greater than the “variable costs” – let me explain. Moving forward in line is not a straight line equation. The effort required to take the first step (which may require halting conversation or simply shifting your weight from a contrapposto stance) is greater than the effort required to take each additional step.

The economics are the same as that of a taxi ride: it costs $2.40 just to get into the cab (high fixed cost) and then $0.40 per mile when you’re traveling (low variable cost).

Therefore it is rational, when waiting in line, to put off moving for as long as possible and progress only when it becomes socially unreasonable not to do so (e.g. the people behind you in line get angry).

Understanding these principles can help in a variety of ways: think about trading stocks. The fixed cost (initiating a trade) is much greater than the variable cost (adding more volume to the trade). Recognizing this trend can really help explain the market swings so wildly – people who were previously standing still now see that there is 5 feet in front of them – and they lurch forward to make an adjustment.

The lesson? Remember that people would rather stand still – so you should act early. But, if everyone around you in line has already started to move – it’s time to run.

Lessons from waiting in line at the airport
  • Tag: Efficient markets hypothesis. Humorous.

    Also, economics is one way to look at it; maths is another (e.g. http://en.wikipedia.org/wiki/Queueing_theory). Well, they are related…

    Nice insight about the stock market. Another implication is that fixed-numbers of trades (e.g. the fact that people don’t do fractional trades) is inefficient. Bounded by human limitations and all.

    Another implication is that if everyone around you is moving, then you’re in a queue: or, you’re behind the curve. Real life rarely has actual queues, where you activity is bounded by other people.

    Rather, real life follows a herd pattern, where the activity of one person is uncontrolled but influenced by those around him/her. The fixed/variable cost distiction remains, but the ability to be a first mover changes.

  • I’m happy you spotted the tag :)

    Thanks for the tip on queuing theory. Some of my favorite things in life are elegantly complex explanations for mundane phenomenon.

  • I’m happy you spotted the tag :)

    Thanks for the tip on queuing theory. Some of my favorite things in life are elegantly complex explanations for mundane phenomenon.