There are a lot of different reasons why people are willing to pay extra for something that is available in a cheaper form. It may be because they prefer brand name cola to a store brand, or because they think that the higher priced item will convey high status. Sometimes, however, people are willing to pay more because what they get is worth substantially more. There's an old saw that says you get what you pay for. This is definitely the case when it comes to buying tires. Although premium tires can cost quite a bit more than the cheap kind in terms of initial investment, the high initial cost is offset by the fact that they last considerably longer. This is sometimes known as the "Boots" Theory of Economic Unfairness and it explains why buying a discount brand can often end up costing more in the long run. For the purposes of example, let's assume that a good quality pair of boots costs $500. A rich man can afford to pay this, and in consequence he owns a pair of boots that will serve him in good stead for 10 years or more. A poor man, on the other hand, can only afford to buy cheap boots priced at $100. These cut-rate boots leak and will only last for one year, at which point the poor man must buy another pair of cheap boots for $100. At the end of ten years, the rich man has still only spent $500 on boots, while the poor man has had to spend $1000 and he will still have wet feet. This is essentially the difference between cheap tires and premium tires. The premium tires cost less over time, and are therefore definitely the better buy. Unless of course you like having wet feet... |
