Adverse Selection
An economic rule explaining why making a service free ruins it. Charging even one dollar forces people to have a bank card, basic reading skills, and real intent. Setting the price to zero removes that gate completely, instantly flooding the platform with the most helpless and clueless people alive.
The counterpart to this is Positive Selection, where a small paywall immediately filters out the time-wasters and leaves only competent users. Without that filter, you get Moral Hazard and the support tax, meaning free users offload all their thinking onto staff and demand endless help for things as simple as opening a link, because failure costs them nothing.
The counterpart to this is Positive Selection, where a small paywall immediately filters out the time-wasters and leaves only competent users. Without that filter, you get Moral Hazard and the support tax, meaning free users offload all their thinking onto staff and demand endless help for things as simple as opening a link, because failure costs them nothing.
Adverse Selection by A Random Dude... October 28, 2026
