Sunday, May 13, 2007

The Tooth Rate of Exchange

I have written about Tooth Fairies and their economic role before. Today, comes a barometer of economic prosperity from DeCare Dental. They conduct a yearly survey of tooth fairy per tooth payments and apparently this year, it is down 15 percent. (Here is the a video of the news or here). Sadly, the data does not appear to be available on their site.

As I noted in my earlier post, there is an issue as to what a tooth ought to be worth and, in my opinion, it will be highly correlated with dental costs. The DeCare data might allow us to test that but that is something for another day.

The news provoked me into reporting our pricing policy. It is this: some proportion (perhaps 100 percent) of the change I happen to be carrying. On the very first tooth I saw through an issue: whatever we set this time might drive future payments. Moreover, they could only be inflationary. If I didn't have the correct change, I might be tempted to up the deal. We paid $1 for the first tooth and went on from there.

So on the second tooth, our daughter got less. On the third tooth she got more. In each case, it was explained that the tooth payment was set by the tooth fairy and there was no reason to expect that to be consistent.

The beauty of this is that every time some child looses a tooth we don't have to think. No worry about what the last payment was, what other children got, etc. And let me tell you, we need less of this type of thinking in our lives. We can just delve into our pockets and pull out an amount and go from there. This frees us of much of the mess associated with tooth financial management.

So I recommend a floating arrangement on tooth pricing as the 'customer' will come to expect it (something businesses often forget to take advantage of).