By Dylan Mortimore
They say that cool people always endeavour to arrive ‘fashionably late’ to parties and other social gatherings. Yet, on Sunday the 21st of February, the date of the highly anticipated launch party, Over the Hedge, the average attendee strolled into Jade Buddha at 1:50pm – ten minutes early. Could it be that the members of UQES, UQBA, UQIES and UQPPES were simply unaware that 2:17pm is the unequivocally optimal arrival time for an event beginning at 2pm? Surely not. After all, these societies are known only to recruit the coolest of the cool. Therefore, the average attendee must have felt that 1:50pm was the truly utility-maximising time of arrival. But what would spur on such uncharacteristic punctuality?
As it turns out, this swarm of rational economic agents knew that arriving at 2:17pm would be utterly calamitous, a move that could lead to missing out on the main attraction entirely. I am, of course, referring to the $5,000 bar tab.
Now, I know $5,000 sounds like a lot of money to be spent on beverages, but there’s a few fundamentals to consider. These days, a drink on Eagle Street costs around $10 and the average Over the Hedge attendee will no doubt be double-parked after each trip to the bar. Moreover, it should be noted that
Sushankar veteran utility-maximisers will generally manage around seven trips to the bar in the first five minutes after the tab opens. This means that, within five minutes, around $140-worth of drink spend can be attributed to Sushankar a single veteran.
From my observations, there were approximately twenty attendees that could be considered ‘veteran’ status: this means that, by 2:05pm, $2,800 ($140 x 20) had been depleted by the veterans alone. While the veterans tend to struggle even locating the bar after this stage, the average attendee endures, managing to double-park themselves twice in the ten minutes that follow. Therefore, it takes only 55 ‘average’ launch party goers to see the tab depleted entirely by 2:15pm. And so, those who arrive ‘fashionably late’ inevitably miss out.
It is a textbook case of the Tragedy of the Commons: the circumstance where consumers have unrestricted access to a resource and, by acting in their own self-interest, contribute to its depletion. This means that bar tabs – in all their glory – are not pure public goods. While no attendee of Over the Hedge was denied access to the bar (the good is non-excludable), one person’s consumption certainly detracted from everyone else’s (the good is rivalrous). In this case, the tragedy entails a significant equity issue: over half of the value of the tab is depleted by veterans in the first five minutes, and those who arrive after 2:15pm receive nothing. Thus, intervention is warranted.
Regulation is perhaps the most obvious solution: the student societies could place a limit on the number of drinks a person can consume or simply outlaw the practice of ‘double-parking.’ While this solution would make the tab last longer and give latecomers a chance to get a piece of the action, it would be a PR disaster. Attendees would feel betrayed by the very societies in which they had placed their faith; for many University students, receiving only one drink per trip to the bar is entirely unthinkable. In turn, membership sales in the subsequent year would plummet, sending the offending societies into disarray.
Perhaps a more palatable approach to addressing the equity issue would be more targeted ‘line policing’. With the aforementioned veteran utility-maximisers seemingly being able to teleport to the front of the line, more vigilant monitoring could ensure that drinks are evenly distributed among the attendees. However, this would do little to impact the size of the line at any given time, and latecomers would be very likely to miss out.
Alternatively, increasing beverage supply through a bar tab extension would serve to provide all attendees with greater utility. If the funding was large enough, I would argue that a quantity could be supplied such that all attendees are able to maximise the utility they derive from drink consumption. This is because it would be expected that the marginal utility of alcohol consumption would eventually become negative given a large enough number of drinks. Hence, if the right quantity was provided, we could eliminate the Tragedy of the Commons entirely. Funding, however, is still the inhibiting factor.
Analysts suggest that the extra funding could be raised by issuing bonds to institutions with surplus capital to invest, such as the UQ Law Society. Unfortunately, resorting to debt capital markets is a scary option given the volatile economic climate, with Moody’s already considering a downgrade of UQES’ credit rating after the so-called ‘zuccing’ of the society’s Facebook page a mere fortnight ago. Given the increased risk these social media tensions pose for the student society industry, potential downgrades for UQBA, UQIES and UQPPES could definitely follow. UQES continues to evaluate funding options; however, anonymous sources say UQBA has tapped various advisers regarding a potential IPO in mid-April.
Ridiculous solutions aside, it may be the case that social norms are the root cause here. After all, there literally exists a Wikipedia page called Alcohol in Australia (other nations do not have this – I checked). And if you still watch the ABC (this is probably just me), you might have stumbled across Shaun Micallef’s On the Sauce, which explores the highs and lows of Australia’s drinking culture. One thing On the Sauce highlights is the tendency of young people to consume in excess, often to the extent that the outcomes seem very inconsistent with a utility-maximising decision. Therefore, a cultural shift toward moderation might be the only way to preserve a finite bar tab.
But cultural change is easier to propose than implement, and it requires a longer-term outlook. For now, the keenest among us might just have to resort to punctuality when (limited) free drinks are involved…