From the Predictably Irrational site blog:
I thought it a nice way of skipping over all the rigorous crafting of psychological experiment... This just cuts to the chase.In one of our projects, Kristina Shampanier, Nina Mazar, and I examined whether our reaction to Free! is just a rational reaction to a low price (a very low price) or if it is an irrational overreaction to Free! ... For now let's skip the experiments and consider the following thought experiment:
Consider how long you would be willing to stand in line for a free Ben & Jerry's ice cream cone. Let's assume that your answer is 20 minutes and that the cost of a Ben & Jerry's ice cream cone is $1.45. Now answer this: would you be willing to stand in line for 20 minutes for $1.45 in cash? No way.
Thoughts? Other examples?
The first thing that comes to mind is when we buy two or three of something we're somewhat indifferent to at the store, just because we can get another one for free as part of the deal.