Oh really? What if they raise the price of postage on First Class mail by one cent. Would you look at the stamps, scream bloody murder, and stamp (hah!) out of the Post Office?
Sure, increase prices, and demand will fall, but it's not perfectly linear, and even a one cent increase boosts revenues considerably.
Right. So pedantry wins. The point is that there is some number of pennies after which the demand is elastic notwithstanding the original poster's indifference to a one cent price increase now.
The class for which there is only a marginal benefit to sending it in hardcopy vs. email. Or the class of items whose delivery could be delayed long enough to combine it with another item.
Here are some types of letters that won't fall under that:
* Birthday/Christmas cards. The postage is a small fraction of the card.
* Legal-y letters, (e.g. when you make an offical complaint ), since the price of the stamp is again a tiny fraction of what you're complaining about.
* Big padded envelops of A4 print outs of contracts or something (again, postage is insignificant)
Most utilities are switching to electronic billing, and/or charging for paper billing, so they are already getting rid of postage.
Are you really arguing that the demand for first class mail is completely inelastic based on my lack of examples of what the marginal cases are? After some number of pennies of increase, demand will fall - are you actually disputing this?
All you're arguing is that there are some pennies of increase which could increase revenue. Fine. That's not saving the post office.
If you increase prices and demand falls enough, you don't get a revenue boost. Upon one USPS increase, they lost my business altogether (save for maybe 5 stamps per year, instead of 120); a one cent increase cost them a lot more.
> Would you look at the stamps, scream bloody murder, and stamp (hah!) out of the Post Office?
Maybe not me and not by one cent but eventually, if they keep raising the prices, I would look at the price and think, "hmm this is getting kinda pricey. I wonder what UPS would charge to deliver this..."
You can go check. USPS has a long way to go before it comes close to the prices UPS and FedEx charge. It's like comparing coach to business class airline tickets for the vast majority of mail. The postal service is truly an amazing service for small parcels within the United States.
That is why I said "eventually" ... it will be more than one cent and it will happen slowly. As price keeps cropping up some people will choose to use other services.
Sure, increase prices, and demand will fall, but it's not perfectly linear, and even a one cent increase boosts revenues considerably.