What Would Randy Cohen Do?

August, 09 2012
Culture, Latest

by Sarah Breger

On Monday, at least 5,000 round-trip tickets to Israel from New York on El Al airlines were sold for under $400 (tickets usually cost $1,600). It turns out that the price was a mistake due to a glitch from a third-party company. Upon discovering the error, El Al first announced they would honor the tickets, but are now undecided and said via Twitter that they would announce their decision later today.

Should El Al honor these tickets? It’s hard not to be rooting for the ticket-holders, as this seems like a classic big corporation vs. little guy story. But is that the ethical thing to do? To get some answers, I spoke this morning with Randy Cohen, the former New York Times Ethicist and author of the new book Be Good: How to Navigate The Ethics of Everything. Below is a condensed version of his answer.

El Al should offer to honor all those tickets, and the customers should decline the offer.

El Al, like other companies, has a duty to honor the advertised price. If it is a third party mistake, then El Al should seek compensation from that third party that actually made the error. Part of the reason to honor prices as advertised is to keep markets honest. In some jurisdictions–and check with a lawyer on this–companies have a legal obligation to honor every advertised price. But besides that, this prevents unscrupulous people from doing “a bait and switch”—hooking people with one price, but then charging another. No one here has said it is anything more than an accident on El Al’s part.

However, even if El Al offers to make good on the tickets, we are not supposed to exploit someone. If you see someone’s wallet on the ground you are supposed to return it, not keep it. If you see a bank vault door open, you shouldn’t just go in and take the money. There is a notion of symmetry here: If, say, the El Al website had the price for a coach ticket set at $10,000, you would most likely say something–call to confirm–because it is a price that doesn’t make sense. And if El Al confirms the price, so be it. The same goes for prices under $400–from the reports, it sounded as if people who bought the tickets knew it was a bizarre price.

For example, if you are in a supermarket and a steak was marked at 12 cents a pound, you know it is a mistake and you have a duty to at least inquire from the merchant if that is the correct price. You have to show tolerance for others people’s errors or else we would be walking around always looking over our shoulders, scared that if we make a mistake the hyenas would swarm.

[I interjected to say my mother would most likely hold the merchant to his advertised steak price- SB] Most places would honor the mismark as a kind of customer relations, but if she saw the steak marked $85, wouldn’t she inquire about it? If you do it one way you have to do it the other way. You have to have a consistent ethical principle, whether you will benefit or lose by asking.

So, readers, what are your thoughts on the El Al ticket fiasco?

4 thoughts on “What Would Randy Cohen Do?

  1. Scott Nason says:

    I wholeheartedly agree with Randy’s views of the buyer’s obligation not to take advantage, as well as the seller’s obligation to honor the sale. I don’t think it is so clear that having inadvertently posted the erroneous price that they are obligated to complete the sale.

    I used to manage the revenue management function at a major airline, whose pricers posted a few erroneously low fares. Our policy was to work very quickly to shut off availability so it wouldn’t sell, but to honor those who bought it. I didn’t feel ethically bound to keep selling trips to Hawaii for $25 once we discovered our error. Now had we published an ad in the NY Times, promising tickets to Hawaii for $25, that would have been a different story.

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