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50 Things That Made the Modern Economy

Factual: Money

The stories of inventions, ideas and innovations which helped create the economic world

Tim Harford tells the fascinating stories of inventions, ideas and innovations which have helped create the economic world.

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50 Things That Made the Modern Economy: Disposable Razor

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Razor

25/02/2017 GMT

Disposable Razor

BBC World Service - 50 Things That Made the Modern Economy, Disposable RazorSearch BBC

King Camp Gillette created the disposable razor. But his influence extends beyond shaving

King Camp Gillette invented the disposable razor. He also invented two-part pricing – attract people with a cheap razor, then charge them for expensive replacement blades

King Camp Gillette came up with an idea which has helped shape the modern economy. He invented the disposable razor blade. But, perhaps more significantly, he invented the two-part pricing model which works by imposing what economists call “switching costs”. If you’ve ever bought replacement cartridges for an inkjet printer you experienced both when you discovered that they cost almost as much as the printer itself. It’s also known as the “razor and blades” model because that’s where it first drew attention, thanks to King Camp Gillette. Attract people with a cheap razor, then repeatedly charge them for expensive replacement blades. As Tim Harford explains, it’s an idea which has been remarkably influential.

Producer: Ben Crighton
Editors: Richard Knight and Richard Vadon

(Image: Razor, Credit: Shutterstock)

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