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The SIFMA Foundation is dedicated to fostering knowledge and understanding of the financial markets for individuals of all backgrounds. Drawing on the support and expertise of the financial industry, the SIFMA Foundation provides financial education programs and tools that strengthen economic opportunity across communities and increase individuals’ awareness of and access to the benefits of the global marketplace.

Among its leading efforts, the SIFMA Foundation:

• Supports 4th through 12th grade teachers across the country with best-in-class educational programs that make student learning real-world and fun;
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“Students who played The Stock Market Game™ scored significantly higher on mathematics and financial literacy tests than their peers that did not play.” Learning Point Associates

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The Stock Market Game™

The SIFMA Foundation's acclaimed The Stock Market Game™ program is an online simulation of the global capital markets that engages students grades 4-12 in the world of economics, investing and personal finance, and prepares them for financially independent futures. More than 600,000 students take part every school year across all 50 states. The Stock Market Game has reached 22 million students since its inception in 1977.

InvestWrite™️

The SIFMA Foundation's InvestWrite™ national essay competition is a culminating activity for The Stock Market Game students, extending what they have learned in SMG by challenging them to analyze, think critically and problem solve. Students address real world financial issues and situations by answering a question about long-term saving and investing. A new theme and question are posed each year. Since the program began in 2004 over 260,000 essays have been written in classrooms across the country and more than 50,000 volunteers have served as judges in the writing competition.

Capitol Hill Challenge™

The SIFMA Foundation's annual Capitol Hill Challenge™ (CHC), presented by the Charles Schwab Foundation, is an exciting national financial education competition for junior high and high schools that reaches all 50 U.S. states and their members of Congress. CHC matches Members of Congress with students, teachers, and schools competing in The Stock Market Game™ in their respective district or state. Student teams manage a hypothetical $100,000 online portfolio and invest in real stocks, bonds, and mutual funds. Since its inception in 2004, CHC has made 7,500 matches of U.S. Representatives and Senators with schools, encompassing more than 170,000 students across the country.

Invest It Forward™

Invest It Forward™ is an award-winning industry-wide financial education and capital markets literacy campaign convening hundreds of financial firms that are committed to giving young Americans a solid understanding of the capital markets system and the invaluable tools to achieve their dreams. Invest It Forward is designed to help young people understand how to harness the capital markets for their own benefit and realize their dreams.

Learning Point Associates Study

An independent study by Learning Point Associates found students who participated in the SIFMA Foundation's The Stock Market Game™ program scored significantly higher on mathematics and financial literacy tests than their peers who did not. They also found that teachers who taught SMG reported the program motivated them to better plan for their future and to engage in financial planning, research, and use of investment products and services.

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More than 5,000 industry volunteers served as judges for last year’s InvestWrite™ program, a national essay competition based on the acclaimed The Stock Market Game™ . Judging takes less than two hours, is completely virtual, and makes a big impact in a child’s life.

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Stock Market Game™

The SIFMA Foundation's acclaimed Stock Market Game™ program is an online simulation of the global capital markets that engages students grades 4-12 in the world of economics, investing and personal finance, and prepares them for financially independent futures. More than 600,000 students take part every school year across all 50 states. The Stock Market Game has reached 16 million students since its inception in 1977.

An independent study by  Learning Point Associates  found students who participated in the SMG program scored significantly higher on mathematics and financial literacy tests than their peers who did not. They also found that teachers who taught SMG reported the program motivated them to better plan for their future and to engage in financial planning, research, and use of investment products and services. Want to learn more about the Stock Market Game's impact?  View the Learning Point Associates Study Summary .

Learn more about the  Stock Market Game  here or view the Stock Market Game  brochure .   

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The SIFMA Foundation's annual Tribute Dinner celebrates industry champions of youth financial education and raises awareness for an important cause. This year's dinner took place on  October 11, 2017 at  Cipriani (25 Broadway, NY). The honorees were Andy Sieg, Head of Merrill Lynch Wealth Management, and  Gerard McGraw, Chief Financial Officer Fidelity Investments.

Stock Market Game  More than 600,000 students take part every school year across all 50 states. An independent study by Learning Point Associates found students who participated in the SMG program scored significantly higher on mathematics and financial literacy tests. 

• Learn how you can get involved today!  

InvestWrite   

Since the program began in 2004 almost  194,000 essays have been written in classrooms across the country and more than 22,000 volunteers have served as judges in the national essay competition.  

• Learn how you can get involved today!     

Capitol Hill Challenge   

CHC connects middle- and high-school students across the country with their member of Congress. In 2017, we had 100% participation from Congress and over 60 Senators and Representatives met with their teams personally. The top 10 teams win a trip to Washington, DC!  

• Learn more about the Capitol Hill Challenge

Invest It Forward IIF connects volunteers from industry firms who personally offer exciting, multimedia in-school and afterschool lessons to help our nation's youth better prepare for their own futures as financially capable and engaged citizens. Learn how you can get involved today!

• Learn how you can get involved today!

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Stock Market Game™ Program

What is the Stock Market Game™? It is a comprehensive economics and personal finance education program for Grades 4 to 12.  Small student teams compete for awards by investing $100,000 in an online, virtual portfolio.  The adult advisor registers the student teams. Student teams are provided online access to their own online investment portfolio.  Students research and apply their investment ideas in a real-world market environment.

Is there research that the Stock Market Game™ positively impacts academic performance? Yes, a rigorous, randomized, controlled study by Learning Point Associates, a nonprofit education agency, found that students who participated in The Stock Market Game™ program scored significantly higher on mathematics and financial literacy tests than their peers who did not. Improvements in academic performance were achieved regardless of the classroom implementation of the Stock Market Game ™ basic or advance.  The study was conducted in 600 classrooms, with half of the classrooms playing in the Stock Market Game ™  and half not playing.

Learning Point Associates also conducted a nationwide survey of nearly 5,000 teachers who taught with the Stock Market Game.  The teachers reported that the program motivated them to better plan for their own future and to engage in financial planning, research, and use of investment products and services. >> Link to PDF Summary >>Link to PDF of the Full Study

What is the Registration Fee Per Student Team? • $10 per team, per game session if the advisor registers more than one team during that game session • $25 per team, per game session, if the advisor registers only one team for that game session

How Are Teams Determined? Advisors may register a minimum of two students or up to a total of four students per team. Students may only participate on one team per Game Session (Fall, Spring and Year-Long).

When does the Game Start? The Stock Market Game™is conducted during the school year. There are three different game sessions during the school year:  Fall, Spring and Year-Long.  >> Click here for key dates.

How Can Educators Learn More about the Stock Market Game™? >> Click Here for the national website for The Stock Market Game, a program of the SIFMA Foundation.  >> Click Here  for additional educator resources.

What are the Virginia Stock Market Game™ Awards? Awards are presented to teams with the top performing portfolios in their region and/or state. At the state level, awards are presented to:

• The top three schools for the Fall, Spring, and Yearlong Sessions • The top high school, middle school and elementary school (if not already recognized in the top three overall teams)

Teams are placed in regions based on the location of VCEE’s affiliated Centers for Economic Education. Regional awards are determined and presented by the Centers.

InvestWrite®  is a culminating activity for Stock Market Game students extending students’ classroom learning with a written challenge to address real-world financial issues and situations. Students must analyze, think critically and problem solve about a long-term saving and investing scenario. Some 20,000 student essays are evaluated by teachers and thousands of financial professionals serving as volunteer judges. Winners locally and nationally rise to the top to earn exciting prizes and recognition including a trip to New York City’s famed financial district.

For more details on  Fall and Summer InvestWrite registration and essay deadlines and requirements:     >> Click Here to view the InvestWrite website.

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• Competition

Writing Prompts

Essay Scoring

Eligibility

Recognition

Past Winners

• Official Rules

The Stock Market Game™ (SMG™) advisors announce the InvestWrite® competition to their SMG™ student participants and assign or invite them to write essays.

SMG™ student participants write their InvestWrite® essays. SMG™ advisors review the essays and submit the best ones online prior to the deadline.

InvestWrite® judges review and score up to eight essays each. Essays are evaluated on (1) Rationale, (2) Understanding the Subject Matter, and (3) Writing Style.

InvestWrite® administrators collate all the scores and SMG™ advisors are notified if they submitted any winning entries. Then it’s time to celebrate!

300-800 words

400-900 words

500-1000 words

The essay should be well organized and written in a manner that indicates there was a logical thought process involved in addressing the assignment. In the essay, the student should present a thoughtful progression of ideas and recommendations. Essays should draw clear connections between the student thinking and recommendations or conclusions.

The judges will read the essay with the following questions in mind based on the student grade level. Does the student completely address the elements of the question and use appropriate terminology? Does the student exhibit knowledge regarding researching and planning an investment strategy? This aspect of scoring targets the student's understanding of the basic concepts taught in the Stock Market Game.

Judges ask if the essay is interesting, easy to read and engaging from start to end. Students have an opportunity to exhibit the ability to communicate thoughts in an engaging and inviting manner. This includes assessment of grammar, spelling, and punctuation. Students are welcome to think beyond examples provided and make their essay unique by expression of their own interests and creativity.

• Stock Market Game™ advisors and students must be registered and participate in the Stock Market Game™ during an eligible session.
• Essays submitted must be an individual student’s own research, thinking, and writing.
• Although the Stock Market Game™ is a team experience, InvestWrite® entries must be the work of an individual student.
• InvestWrite® entries must comply with the Official Rules in order to be eligible.

National Recognition

Every participant is eligible to receive an InvestWrite® Certificate of Achievement. Additionally, the top 10 students in each grade division of InvestWrite are recognized for their excellence and will receive the items outlined below. Parents, teachers, classrooms, and schools of those 10 students will also be recognized.  

State Recognition

Contact your Stock Market Game™ Coordinator for information regarding awards and recognition in your state.

Student Recognition

Teacher Recognition

Classroom Recognition

School Recognition

Parents Recognition

Teacher: Katie Ennis

Paul R. Hanlon School

Westwood, MA

Teacher: Yulia Mikhels

The Christa Mcauliffe School/IS 187

Brooklyn, NY

Grades 9-12

Teacher: Sarah McCance

Fountain Valley High School

Fountain Valley, CA

Teacher: John Ferrero

Macdonough School

Middletown, CT

Teacher: Brandi Jones

Colby Middle School

Teacher: Keisha Roberts

John A. Dubiski Career High School

Grand Praire, TX

Justina Z. 

Teacher: Kyla Ahnemann

Skaggs Elementary School

Teacher: Sandra Ozgar

Holland Township Elementary School

Milford, NJ

Teacher: Jesse Peterkin

Ridgefield High School

Ridgefield, CT

Teacher: Talisa Johnson

Pates Creek Elementary School

Stockbridge, GA

Teacher: Alison Smith

LaSalle Springs MIiddle School

Wildwood, MO

Teacher: Jason Majewski

Bethlehem Central High School

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• Teacher Resources

InvestWrite Winners Spring 2017

The winners each received certificates and $50.

Why is Diversity Important?

by Jeffrey L.

Forest Park Elementary School, Little Rock School District, Pulaski County Advisor: Jason Finney

What is diversity? Diversity is necessary in the stock market and in normal daily life. If all you ate were potatoes and were addicted to them, but then all the potatoes got infected by a bug and you could not eat them anymore, what would you eat? This is just one silly example of why diversity is so important in life—and the stock market. If you bought stocks in just the oil industry and then the main place where oil is drilled decides they want to stop trading and having connections with one another, then all the oil and gas stocks would probably go down. If everyone were the same and didn’t have different opinions and did everything the same, wouldn’t the world be boring? If no one had different interests and had the same opinions about things, what would be the purpose of making those things and doing anything, what would even be the purpose of living?

My group in the Stock Market Game had a pretty diverse portfolio. We have 9% of our shares in basic materials, 14% in consumer goods, 17% in financial aid or insurance, 9% in healthcare, 20% in technology, and we had a bit of cash left. Our group is evidence that having a diverse portfolio is extremely important, because we have reached third place out of 266 groups in our region, and the Stock Market Game is still going. We’re still buying and diversifying our portfolio, so we may climb even more!

If I were to do anything differently with my portfolio in real life I would probably find and invest more in new stocks that are in sectors I don’t have any stocks in. I think I would buy mutual funds and bonds because they are the safest way to earn more money, and it is very rare to lose money with them (bonds actually reduce risk). I also would buy mutual funds since when you buy mutual funds you're buying them with other investors, so you get part of a pool of their investments. You get built-in diversification.

So why is it important to have a diversified portfolio? First, if all you invested in was in the same two or three sectors and something happened that made one of your stocks go down then the other stocks in that same sector or industry would probably go down too, as I have already stated. Diversity also helps reduce risks. If your portfolio was diversified and one stock went down from some kind of event and you did not have almost all of your other stocks in the same industry or sector, then at least they would not be affected from that specific event.

Diversification plays a very critical role in the stock market and in the world that is around us. I have learned a great deal of knowledge about why diversification is so significant in the stock market and why it helps to have it in your portfolio. I have also learned so much about the stock market in general and how to pick stocks, mutual funds and bonds, and when to sell. If I play the Stock Market Game again I will buy some mutual funds and some bonds. I will also try and find stocks that are in industries or sectors that I don’t have any stocks in. Diversity is important!

Serving Those Who Serve Us

by Logan F.

Cabot High School, Cabot School District, Lonoke County Advisor: Stephanie Wade

Values based investing is the act of investing to make the world a better place. This is done daily by thousands of investors. Say if an investor was greatly outraged by the affects that cancer or other diseases had on people, they may invest in different medical companies. This is done with the intention to provide for those companies to assist in their attempts to battle the diseases. It is not just disease that investors battle though. They also work to help those who are victims of things such as natural disasters or even physical abuse by investing in related companies. One world issue that deserves to be invested in is that of military service members who deal with PTSD and the difficulty of transitioning to civilian life. This is a real issue that deserves more attention than it has, and that could be helped with values-based investing.

Every single year, at least 180,000 people enlist in the United States armed forces. They devote a great portion of their lives to serving and protecting this country. Every year, at least 550 people leave the service and search for a new life as a civilian. This comes with great difficulty. When people join the military, they rarely learn techniques and skills that are often used in the civilian world. This means that it is a huge challenge for most veterans to find a successful job to provide for them and their families. Through this stress and the possible stress gained in the service, many veterans grow depressed and hopeless. Some even turn to suicide. Roughly 22 veterans commit suicide a day due to their stresses, and this number is obviously disgusting. One veteran lost to suicide is one too many. Therefore, someone must take a stand in serving those who serve us. Several companies are aware of this fact, and they do what they can to help, but many do not have the money or resources to do as much as they would like to help the veterans. For this reason, it would a great idea to bring investors into this act, so we can provide more money and opportunity to save those who fight for us.

Disney has respected the military for many years, and has donated millions of dollars to military programs in attempts to aid the veterans. Sprint has accepted over 1300 veterans as employees over the recent years. One business that really seems to stand out, however, is Bank of America, who has pledged to provide jobs for 10,000 veterans. In the Stock Market Game that I have been involved in recently, I plan on investing in these companies due to their supportive acts towards others. I believe that Disney and Bank of America will be two of the most successful long-term investments. Disney would be because they play an important role in creating and reinforcing inclusive behaviors for veterans and other employees in the workplace. They also help support professional development courses designed to help veterans navigate their careers at Disney. On top of that, Disney is well known for bringing peace and excitement to people of all ages, so it can help those with PTSD. Bank of America would be a great investment to help our veterans due to that huge goal they have planned to achieve with 10,000 veterans.

Investing in companies such as Bank of America and Disney will allow us to be so much closer to saving every veteran’s life after the military. When we buy stocks of a company, we gain ownership of a part of that company. The money we pay to buy the stocks goes directly to the company to assist them in anything they may need it or want it for. This means that if more people were to invest in these companies like Bank of America and Disney, they would have more available money to put towards giving back to veterans. In doing this, there really is no set investment strategy. It is all about the concept of values based investing, in which we invest not to benefit ourselves necessarily, but to provide more money to programs that give aid to others. If we invest in companies like Bank of America and Disney, they will can turn that money around and put it to use in saving the veterans. Disney could provide more money to military programs and Bank of America would have a much easier time providing 10,000 jobs, maybe even more, to veterans.

It is completely saddening that so many of the world’s finest men and women have such a difficult time living after leaving the service. No veteran should ever fall depressed and possibly even commit suicide because of the difficulty of transitioning to the civilian world. Therefore, investing and putting money forward to aid in their recovery and transition is so important. Investing is the path to take in helping. I hope that after reading my thoughts and opinions, you all will search within yourselves to see how you have been served by our military, and feel encouraged to paying it back. It is our turn to serve those who served us.

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Taking stock

Winners of stock market game, investwrite essay competition share success stories.

8:33 a.m., June 12, 2014--Fourth-grader Mike Young and his classmates earned a profit of over $8,000 along with some valuable lessons about the stock market thanks to the Stock Market Game (SMG), a 10-week simulation administered by the University of Delaware’s Center for Economic Education and Entrepreneurship (CEEE) since 1983.

The winners of the SMG were honored along with their families on Wednesday, June 5, in the Perkins Student Center. Between March 3 and May 9, 1,075 students on 294 teams played the stock market in real time with a hypothetical $100,000.

Honors Stories

National Medal of Science

• Warren Award
• Athletic training accolades
• Outstanding student teachers
• Library recognition

“We started off playing as just a fun game and we were only playing for the enjoyment,” said Young. “But then it ended up and we won it. It was fun to win and we learned a lot about the stocks, but I’m just proud of my team and how good we did.” 

Young and his teammates Christian Garrett, Kevin Lundin, Miguel Marcial-Gutierrez, Ray Khan and Elijah Malgiero from Jennie Smith Elementary School were the winners of the elementary school division. Under the guidance of teacher Barbara Frank, the team was able to increase their initial investment of $100,000 to $108,189.

The team purchased stocks like Apple, CVS and Nadal Chemical Company, which they had seen on television.

“Next year we might as well group up again since we did so well this year,” said Marcial-Guiterrez, who added that the boys’ interest in finance will continue. “Over the summer we will keep our eye on the stock market.”

“We are excited to play again next year,” said Khan. “We hope that we win again.” 

In the middle school division, Bruce Rodriguez and DeAirhius Tiller from Kirk Middle School worked with teacher Gail Morris to grow their $100,000 to $105,489. 

Morris said this year’s competition was made even more accessible to students due to a generous grant from the Investor Protection Unit of the Delaware Department of Justice that lowered team fees.

“I usually pay for it out of pocket,” said Morris of the fees. This year the price per team was lowered to $5, making it less expensive to sign up additional teams of students. 

“For five dollars I said, ‘Let’s do this,’” said Morris, and so she signed up eight teams to play in the SMG. Morris’ own investment turned out to be a very wise one. 

“We had six place in the top 10,” said Morris of her teams, adding that the program helps students to “be more financially sound all the way around.” 

Just be patient, let it grow and give it time was the advice Morris said she most frequently gave her students, who took the guidance seriously, with noticeable results.

Winning stock market strategies

“Our main strategy was to buy as early as possible and watch our profits grow,” said Rodriguez. “Since we’re middle school students, all of us have Apple products, even an iPhone or iPod. We figured buying Apple stock would be a sure hit so we bought Apple early and just watched it for a few weeks.”

“It’s fun, so other people should try it and they could learn from it,” said Rodriguez of the SMG. Rodriguez’s teammate agreed.

“It gave me a chance to figure out how much money companies made,” said Tiller, who was eager to share the credit for his team’s success with his classmates. “We have a lot of smart kids in our class. I love working with my fellow students.”

“I made up a list of my own companies in my head to start with,” said Tiller. The list contained familiar companies like Apple, Polo, Nike and Puma. But Tiller, like many winners of the SMG, began reading financial publications in order to learn about these and other stocks.

“One of our main resources was the comment section of USA Today ,” said Tiller. “In that part of the paper they showed companies that were growing rapidly and those that were rapidly declining.” 

The high school division winners were Sam Miller, Ava Cruz, Susan Biscardi, Nina Lego and Abby Blauvelt from Cab Calloway School of the Arts, led by teacher Chris Clarke.

“This team grew their initial $100,000 to a whopping $117,900,” said Marion Jacobs, CEEE staff member and SMG coordinator. “How about telling us how you did it? And we’re all taking notes, by the way.” 

Biscardi explained to the audience that she and her group used a strategy tailored specifically to the format of the SMG.

“Basically, we knew we had a short amount of time to make the most money,” said Biscardi. “So we looked for stocks that were relatively small cap and that were really volatile. That way, we could increase a lot in a short amount of time. We found one that was pretty cheap so that we could invest in a lot of shares, and any time it went up, it would go up a great amount.”

Biscardi and her team, with research, was able to find stocks that most of the audience had not heard of before.

“The company was called NTLS, a small phone company located in Georgia,” said Biscardi. “And we invested in another one called Tuesday.”

The winners of the Boys and Girls Club middle school division, Mykahl Horsey, Allie Nowotny and Jossalynn Elliott, from Laurel Boys and Girls Club under coach Brian Daisey, grew their original $100,000 to $105,269. They were unable to attend the event. 

InvestWrite winners

As part of the InvestWrite essay competition, each student who participates in the SMG may submit an essay demonstrating their understanding of the stock market and investment strategies. This year’s winner in the elementary school division was Varun Kulkarni from North Star Elementary, taught by Tammy Burgos. Kulkarni’s essay examined the future of investment in the world of video games.

“After researching GameStop, I think this company will be a good long term investment because the demand for video games and smartphones is increasing,” said Kulkarni. “The range of video games has increased greatly since newer and less expensive products such as a variety of smartphones, tablets and gaming hardware are becoming commonly available.” 

The InvestWrite high school winner was Jack Harkins from Cab Calloway School of the Arts, taught by Clarke. His essay focused on the cable television industry as a representation of recent economic trends.

“Throughout the past decade alone the industry has seen countless mergers between different cable companies across the United States,” said Harkins. “And not all mergers have occurred between stable, established companies with large growth potential.”

Owen Lefkon, director of the Investor Protection Unit of the Delaware Department of Justice, presented students with trophies and certificates and spoke with students and their families after the ceremony. 

“I think we have some future Wall Street analysts among us,” said Lefkon of the winners. “You made some money but hopefully more importantly you learned a little bit about investing. Full disclosure: I participated in the SMG when I was in sixth grade. I lost money. But I think back then I learned some good lessons, too.” 

Lefkon also offered these words of advice, reminding students to always research stocks before buying them: “When you’re investing, if it sounds too good to be true, it usually is.”

Article by Sunny Rosen

Photos by Evan Krape

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Welcome to Pricing Hell

The ubiquitous rise of add-on fees and personalized pricing has turned buying stuff into a game you can’t win.

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On February 15, Ron Ruggless was sitting in his home office in Dallas, listening to a Wendy’s earnings call—something he does every quarter as an editor and reporter for Nation’s Restaurant News . When the new CEO of Wendy’s mentioned that the company might introduce “dynamic pricing” in 2025, Ruggless wasn’t surprised; many restaurants have started adjusting prices depending on the time of day or week. It seemed like minor news, so he wrote up a brief report. He didn’t even bother to post it on social media.

About 10 days later, Ruggless saw that Wendy’s was going viral. The Daily Mail and the New York Post had picked up the story, framing the new policy as “surge pricing.” On X, Senator Elizabeth Warren called the plan “price gouging plain and simple.” Burger King trolled Wendy’s: “We don’t believe in charging people more when they’re hungry.” Wendy’s went into damage control. In a statement, it claimed that it wasn’t planning to raise prices during high-demand times, but rather to lower prices during low-demand times. That distinction was lost on most observers—including, frankly, this one—and the narrative took hold that Wendy’s was the next Uber.

The anti-Wendy’s backlash made sense. Who wants to pull into a drive-through without knowing how much the food is going to cost? But it was also selective. Dynamic pricing is hardly new. Airlines have been charging flexible fares for decades. Prices on Amazon change millions of times a day. Grocery stores have begun using digital displays to adjust prices on the fly. The list grows by the week.

Prices aren’t just changing more often—they’re getting more complex, too. Fees, long the specialty of banks and credit-card companies, have proliferated across industries. Previously self-contained products (toothbrushes, movies, Microsoft Word) have turned into subscriptions, while previously bundled items (Wi-Fi at hotels, meals on airplanes) are now sold separately. Buying stuff online means navigating a flurry of discount codes, often just expired. Meanwhile, prices are becoming more personalized as companies hoover up customer data.

We’re used to thinking of prices as static and universal. Sure, they might rise with inflation or dip during a sale, but in general, the price is the price, and it’s the same for everyone. And we like it that way. It makes our economic lives predictable, and, perhaps more importantly, it feels fair. But that arrangement is under attack from two directions. The first is obfuscation: the breaking down of prices into components and the piling on of fees. The second is discrimination: the charging of different prices to different customers at different times.

Contempt for fees is strong enough to unite even Republicans and Democrats, and price discrimination isn’t any more popular. One survey showed that half of customers think of dynamic pricing as price gouging; surge pricing in rideshare apps leads to more customer complaints; and polls show that shoppers are worried about companies collecting their data to shape prices.

The battle is not just between businesses and consumers, but also between economists, who prize efficiency, and the rest of us, who care about fairness. And right now, efficiency is running away with it. For every Wendy’s, there are a thousand companies quietly implementing similar schemes, in an ongoing quest to get every last burger—or car, or ink cartridge, or hotel room—into every last hand, for every last penny. Despite the occasional outcry, the era of the single price is rapidly fading into the past. In many ways, it’s already gone.

Pricing occupies a murky space between the mind and the gut. Some early philosophers thought the price of a thing should be determined by its “intrinsic” value, whatever that means, while others argued that its utility mattered most. Plato was against variable pricing. “He who sells anything in the agora shall not ask two prices for that which he sells, but he shall ask one,” he wrote in Laws . He also inveighed against the hotel fees of his day, condemning people who show hospitality to travelers but then extract “the most unjust, abominable, and extortionate ransom.”

The rise of the market economy shifted the understanding of price to be whatever someone is willing to pay for it. But even then, price remained attached to our sense of right and wrong. John Wanamaker, the Philadelphia entrepreneur credited with inventing the price tag in the 1800s, was a devout Christian whose advertisements promised “no favoritism.” According to a hagiographic history of the Wanamaker empire from 1911, “One price to all was neither more nor less than the application to merchandising of the immortal note of equality sounded in the second sentence of the Declaration on Independence.” The price tag had practical benefits, too: You didn’t have to train employees to haggle. Modern pricing “innovation” took off with the airlines. From the late 1930s through the 1970s, airfares were set by the government, so airlines competed on the basis of amenities. (In 1977, the syndicated columnist George F. Will reflected on his preference for United Airlines because it offered macadamia nuts instead of peanuts. “The macadamia nut is one of God’s more successful efforts,” he wrote. “It has a cachet that the pedestrian peanut cannot match.”) That changed with the Airline Deregulation Act of 1978, which preceded decades of “fare wars.” Discount carriers like People Express were soon undercutting the legacy airlines and encroaching on their routes. This forced the old-timers to revamp their pricing practices.

In his book Revenue Management: Hard-Core Tactics for Market Domination , the pricing consultant Robert Cross recalls watching a Delta employee hand out discounts for the last empty seats on a flight in the early 1980s. Cross knew the plane would fill up with business travelers at the last minute, so he suggested holding those seats and charging a higher fare. This idea—selling seats for a lower price if you book early and a higher price later—transformed the airline industry, and saved the legacy airlines.

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From there, the field of revenue management, or adjusting price and availability based on real-time shifts in supply and demand, boomed. Multitiered pricing spread to airline-adjacent industries like hotels and cruise lines, and then beyond to telecoms, manufacturing, and freight. Companies adopted sophisticated software to track real-time supply and demand, and started hiring pricing consultants or even in-house pricers.

The internet, as you may have heard, changed everything. Consumer advocates hailed it as the great leveler, predicting that online shopping would facilitate price comparison and push prices down. Like many early forecasts about the internet, this one looks painfully naive in hindsight. Companies wasted little time making it harder for customers to compare prices. In 2004, the MIT economists Glenn and Sara Fisher Ellison found that online vendors were advertising the cheapest version of a product, then steering customers toward a pricier one. Websites also learned to block web crawlers that allowed their competitors to detect price changes.

One of the more powerful forms of price obfuscation was the fee. Retail platforms often listed products in order of price. “So, of course, certain retailers realized they could charge one cent for a video camcorder, and shipping would be $250,” Sara Fisher Ellison told me. Fees were often obscured until the end of a transaction—a practice dubbed “drip pricing.”

The airlines, having pioneered the use of dynamic pricing, now refined the art of the fee. In 2008, American Airlines began charging $15 for checked luggage. The practice spread and soon became a major driver of airline profits. In 2023, the airlines raked in $33 billion from baggage fees, and even more from other ancillary fees like seat selection, meals, and in-flight Wi-Fi. These add-on fees drove down the prices that were displayed to customers, thus making the offerings look more competitive. It was a win-win arrangement, with both wins going to the airlines.

The rest of the travel and events industry followed suit. Mysterious “resort fees” appeared on hotel bills. Car renters burned time poring over “facility fees,” transponder fees, and third-party insurance. Ticketing websites charged markups as high as 78 percent for concerts. Some fees sounded like jokes. In 2014, an airport in Venezuela charged customers a fee to cover its ventilation system, a surcharge widely mocked as a “breathing tax.” And fees mingled with the broader trend of digitization-enabled unbundling. Want to “unlock” your Tesla’s full battery life? In 2016, that cost an extra $3,250 .

If the rise of the fee broke the expectation that prices are transparent, dynamic pricing challenged the assumption that they’re fixed. When Uber rolled out surge pricing in the 2010s, the company billed it as a way to lure more drivers when demand was high. But the phrase was perhaps too honest. It evoked a sudden price increase in response to extreme circumstances, and riders accused the company of gouging during emergencies. “It’s a term I tried to stamp out when I was at Uber,” said Robert Phillips, a pricing expert who worked there for almost two years. “It sounds like a digestive problem— I’ve got a little surge going on .”

At least old-school dynamic pricing applies equally to everyone at a given moment. That’s not the case with personalized pricing, which is made possible by the explosion of customer data available to firms. Everyone knows that companies use our data to target ads and decide which products we see. But the use of that data to set prices—to charge each person a different amount based on their calculated willingness to pay—is still taboo.

That doesn’t mean it’s not happening. Back in 2015, for example, The Princeton Review was caught charging higher prices to students who lived in zip codes with large Asian populations. Since then, the data that can be used to customize prices have become more fine-grained. Why do you think every brand suddenly has an app? Because if you download the Starbucks app, say, the company can access your address book, financial information, browsing history, purchase history, location—not just where you live, but everywhere you go—and “audio information” (if you use their voice-ordering function). All those data points can be fed into machine-learning algorithms to generate a portrait of you and your willingness to pay. In return, you get occasional discounts and a free drink on your birthday.

“Often, personalized pricing is embedded as part of a loyalty program,” Jamie Wilkie, a partner at McKinsey & Company who advises consumer and retail firms, told me. “If there’s a high-value customer who’s price sensitive, you may be able to give them a personalized offer. If they’re a lower-value customer, you may just want to reach out to them.” The New York Times recently reported that airlines—of course—are migrating to a ticket-sales platform that allows them to target consumers “with personalized fares or bundled offers not available in the traditional systems.”

Perhaps you don’t like the idea of being designated a lower-value customer , and missing out on the best deals as a result. Perhaps you don’t want companies calculating the precise amount of money they can squeeze out of you based on your personal data or a surge in demand. That’s a perfectly natural way to feel. Unless, that is, you’re an economist.

In a classic 1986 study , researchers posed the following hypothetical to a random sample of people: “A hardware store has been selling snow shovels for $15. The morning after a large snowstorm, the store raises the price to $20.” Eighty-two percent said this would be unfair.

Compare that with a 2012 poll that asked a group of leading economists about a proposed Connecticut law that would prohibit charging “unconscionably excessive” prices during a “severe weather event emergency.” Only three out of 32 economists said the law should pass. Much more typical was the response of MIT’s David Autor, who wrote, “It’s generally efficient to use the price mechanism to allocate scarce goods, e.g., umbrellas on a rainy day. Banning this is unwise.”

The gap between economists and normies on this issue is huge. To regular people, raising the price of something precisely when we need it the most is the definition of predatory behavior. To an economist, it is the height of rationality: a signal to the market to produce more of the good or service, and a way to ensure that whoever needs it the most can pay to get it. Jean-Pierre Dubé, a professor of marketing at the University of Chicago Booth School of Business, told me the public reaction to the Wendy’s announcement amounted to “hysteria,” and that most people would support dynamic pricing if only they understood it. “It’s so obvious,” he said: If Wendy’s has the option to raise their prices when demand is high, then customers can also benefit from lower prices when demand is low.

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Economists think about this situation in terms of rationing. You can ration a scarce resource in one of two ways: by price or by time. Rationing by time—that is, first come, first served—means long lines during periods of high demand, which inconvenience everyone. Economists prefer rationing by price: Whoever is willing to pay more during peak hours gets access to the product. According to Dubé, that can benefit rich people, but it can also benefit people with greater need, like someone taking an Uber to the hospital. You can find academic studies concluding that Uber’s surge pricing actually leaves consumers better off.

When you think about it, though, dynamic pricing is a pretty crude way to match supply and demand. What you really want is to know exactly how much each customer is willing to pay, and then charge them that—which is why personalized pricing is the holy grail of modern revenue management. To an economist, “perfect price discrimination,” which means charging everyone exactly what they’re willing to pay, maximizes total surplus, the economist’s measure of goodness. In a world of perfect price discrimination, everyone is spending the most money, and selling the most stuff, of all possible worlds. It just so happens that under those conditions, the entirety of the surplus goes to the company.

Economists I spoke with pointed out that perfect price discrimination is all but impossible in real life. But technology-enabled personalized pricing is pulling us in that direction. Adam Elmachtoub, an associate professor of engineering at Columbia who studies pricing and fairness (he also works for Amazon), told me that personalization can be good or bad for consumers, depending on how you apply it. “I think we can agree that if personalized pricing worked in a way that people with lower incomes got lower prices, we’d be happy,” he said. “Or we’d say it’s not evil.”

Elmachtoub pointed to the example of university tuition. By offering financial aid to different groups, universities engage in personalized pricing for the purpose of creating a diverse student body. “We agree it’s a good idea in this setting,” he said. Likewise, he noted, it’s good that drug companies can sell medications for lower prices in poor countries.

Dubé argues that personalized pricing should benefit the poor overall, since, in theory, people with less money would exhibit lower willingness to pay. “By and large, when you personalize prices, the lowest-income consumers are getting the lowest prices,” he told me. Plus, he pointed out, there’s another, less controversial term for personalized pricing: negotiation. Consumers pay a personalized price every time they buy a car from a salesperson, who’s likely sizing them up based on the car they already drive, what they’re wearing, how they talk, and other factors. Data-driven personalized pricing merely automates that process, turning more and more transactions into miniature versions of going to a car dealership. Which, again, economists seem to believe is a point in its favor.

Most economists, but not all.

In a 2014 survey, prominent economists were asked whether they agreed or disagreed that surge pricing like Uber’s “raises consumer welfare” by boosting supply and allocating rides more efficiently. Out of 46 economists, only two disagreed. (Four were uncertain, and one had no opinion.)

One of those two was Angus Deaton, a Princeton economist who won the Nobel Prize in 2015 for his work on poverty, and who in recent years has publicly questioned the way his discipline looks at the world. Deaton argues that when it comes to pricing, economists are too focused on maximizing efficiency, without taking fairness into account. In a world of scarce resources, perhaps rationing by time is fairer than rationing by price. We all have different amounts of money, after all, whereas time is evenly distributed. Then there’s the way economists decide what’s good. The mainstream economist thinks that the best policy is the one that maximizes total economic surplus, no matter who gets it. If that benefits some people (companies) at the expense of others (consumers), the government can compensate the latter group through transfer payments. “A lot of free marketers say you can tax the gainers and give it to the losers,” Deaton says. “But somehow, miraculously, that never seems to happen.”

In other words, economics doesn’t pay enough attention to power. In the real world, corporations and consumers are rarely on equal footing. The more complex and opaque prices get, the more power shifts from buyer to seller. This helps explain why, in practice, poor people are often charged more than rich people for the same product or service. The poor pay higher rates for mortgages, bank loans, and other financial services. Wealthy Americans pay less on average for broadband internet. Neighborhoods with fewer grocery stores often have higher prices.

Or take Elmachtoub’s example of college tuition. Yes, poor students who get a free ride thanks to financial aid benefit from personalized pricing. But colleges also collaborate with a thriving “enrollment management” industry that bases financial-aid offers not on students’ need, but on how much an algorithm suggests they and their parents will be willing to pay. This can have perverse effects. As the higher-education expert Kevin Carey wrote for Slate in 2022, “parents of means who themselves have finished college are often sophisticated consumers of higher education and are able to drive a hard bargain, whereas lower-income, less-educated parents feel an enormous obligation to help their children move farther up the socioeconomic ladder and blindly trust that colleges have their best financial interests at heart.” Accordingly, many colleges offer more money to wealthier admitted students than they do to poorer ones.

The concept of willingness to pay contains endless potential for mischief. “I worry about a hotel website knowing that you absolutely must travel to get to a funeral that has recently been scheduled, or a situation where your kid urgently needs some medicine or supplies,” Rohit Chopra, the director of the Consumer Financial Protection Bureau and former FTC commissioner, told me. Improvements in AI technology make that process even easier and more opaque. When a bank denies you a loan, it has to provide a reason, Chopra pointed out. But with AI-based pricing, there’s no such transparency, as algorithms make pricing decisions that humans can’t understand.

According to Tim Wu, a professor at Columbia Law School who helped lead antitrust efforts as a special assistant to President Joe Biden, opacity is the point. The explosion of complex revenue-management schemes allows companies to increase their margins by innovating on pricing, rather than by improving their products or service. The closer we get to personalized pricing, Wu told me, the more we inhabit a world in which “everything in life is like paying for beer at the Super Bowl: Everything’s at your maximum willingness to pay.” There’s a joy—or, in economic terms, a utility—in paying less for something than you might have. “In that model,” Wu said, “you get none of it.”

Is there any way to reverse the march toward ever-more-vampiric pricing schemes?

Tackling junk fees is the low-hanging fruit. Most people, including economists, agree that companies should not charge fees that don’t correspond to actual services, especially when those fees are hidden or disguised. Even the CATO Institute, the libertarian think tank that never saw a regulation it liked, acknowledges that consumers “shouldn’t be charged for products without their consent, and businesses should disclose mandatory fees before purchases are made.” (It still opposes the Biden administration’s anti-junk-fee initiative, which it calls “incoherent” and overbroad.)

The problem is that the incentives are too powerful for companies to resist on their own. In 2014, StubHub switched to an “all-in” pricing model, in which customers saw full ticket prices up front. Revenues went down, so they switched back. “There’s a collective-action problem,” says Shelle Santana, assistant professor of marketing at Bentley University, who has studied drip pricing. If one company refuses to switch to all-in pricing, it can undercut the rest.

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Such a clear, popular case for government intervention is rare, and the Biden administration has pounced. New rules and guidances have poured out of the FTC, the CFPB, and the White House over the past year, capping late fees for credit cards and limiting surprise charges at car dealerships, among other measures. Biden mentioned fees four times in his recent State of the Union.

But industry groups are pushing back . The U.S. Chamber of Commerce says the crackdown will make inflation worse by increasing compliance costs. (In other words, the costs of not charging excessive fees will be higher than charging excessive fees.) A lobbyist for the major airlines said the new transparency rules around add-on fees would cause “confusion and frustration” for customers. Live Nation, the company that owns Ticketmaster, promised to display the full cost of tickets up front for events at venues that it controls, but it has drawn criticism for not extending that policy to cover all events for which it sells tickets. Credit-card issuers are resisting limits on late fees, saying they’d be forced to reduce rewards for other customers, and Republicans in both chambers oppose the cap. Court battles could drag on for years.

And that’s the easy stuff. “The next frontier is going to be price,” Samuel Levine, the FTC’s director of consumer protection, told me. “Because that’s the dream, if companies can actually set personalized prices to maximize profits.”

Ultimately, preventing the dystopia of perfect price discrimination—or some more realistic approximation of it—means cutting off companies’ access to the data they use to determine how much to charge us. This isn’t complicated; it’s just a politically heavy lift. Getting Americans fired up about their personal data has been notoriously difficult, which helps explain why we still have no federal digital-privacy law. Perhaps if more voters understood that strong privacy protections would also protect them from price discrimination, Congress would feel more pressure to get something done. (A glimmer of hope appeared earlier this month when lawmakers announced a bipartisan bill that would limit the user data that companies can collect.)

Near-term solutions might depend on the companies themselves. If prices become too complex, that creates an opening for a firm to commit itself to clear, simple pricing, Bentley University’s Shelle Santana says. For example, Southwest Airlines allows two free checked bags. Mark Cuban’s pharmaceutical wholesaler, Cost Plus Drugs, markets itself as a transparent alternative to the usual stress of buying medicine. Boring Mattress Co. promises to help customers “escape mattress hell” by offering a simple flat-rate mattress with free shipping. Santana cited JetBlue’s early marketing. “Their whole campaign was, We like our customers ,” she said. “As a flier, you’re like, You don’t even have to love me. Just don’t make me feel like I’m in hell .” In a world of constantly shuffling prices, could predictability become a competitive advantage?

Wendy’s might already be on it. A week after the dynamic-pricing flap, the chain announced that it would offer $1 burgers to celebrate March Madness. All you had to do was download the Wendy’s app.

Support for this project was provided by the William and Flora Hewlett Foundation.

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Stock market today: most of wall street slips as expectations rise for rates to stay high.

Elaine Kurtenbach

Associated Press

BANGKOK – Most U.S. stocks slipped Tuesday, and Treasury yields rose on expectations that interest rates may stay high for a while.

The S&P 500 fell 10.41 points, or 0.2%, to 5,051.41. The index deepened its loss from the day before, when it sank under the pressure brought by a jump in Treasury yields. The Dow Jones Industrial Average rose 63.86, or 0.2%, to 37,798.97, and the Nasdaq composite fell 19.77, or 0.1%, to 15,865.25.

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A 5.2% climb for UnitedHealth helped support the market after the insurer reported stronger results for the first three months of the year than analysts expected. Morgan Stanley was another winner, rising 2.5%, after likewise topping expectations.

But the majority of stocks fell as Treasury yields rose following comments by Federal Reserve Chair Jerome Powell. They've been climbing rapidly as traders give up hopes that the Fed will deliver many cuts to interest rates this year. High rates hurt prices for all kinds of investments and raise the risk of a recession in the future.

Powell said at an event Tuesday that the central bank has been waiting to cut its main interest rate, which is at its highest level since 2001, because it first needs more confidence inflation is heading sustainably down to its 2% target.

“The recent data have clearly not given us greater confidence and instead indicate that it’s likely to take longer than expected to achieve that confidence,” he said, referring to a string of reports this year that showed inflation remaining hotter than forecast .

He suggested if higher inflation does persist, the Fed will hold rates steady “for as long as needed." But he also acknowledged the Fed could cut rates if the job market unexpectedly weakens.

Treasury yields climbed immediately after Powell's comments. They had already been higher after the Fed's vice chair made similar comments earlier in the day.

Philip Jefferson said his expectation is for inflation to keep easing and for the Fed to hold its main rate “steady at its current level.” That contrasted with his remarks in February, when he said “it will likely be appropriate to begin dialing back policy restraint at some point this year” if things went as he expected.

The yield on the two-year Treasury, which tracks expectations for Fed action, shot as high as 5% immediately after Powell spoke and got back to where it was in November.

But yields later pared their gains as the afternoon progressed, and the two-year yield drifted back to 4.98%. That's still up from 4.91% late Monday.

Traders are mostly betting on the Fed delivering just one or two cuts to interest rates this year after coming into 2024 expecting six or more . They're now also betting on a 12.5% probability that no cuts are coming, up from just 1.2% a month ago, according to data from CME Group.

The threat of rates staying high for longer hit real-estate investment trusts and utility stocks particularly hard. They pay relatively high dividends and tend to attract the same kind of investors as bonds do. When bonds are paying higher yields, income-seeking investors may camp there instead.

Real-estate stocks fell 1.5% for the largest loss among the 11 sectors that make up the S&P 500. Utilities weren't far behind with a loss of 1.4%.

High rates can also translate into more expensive mortgages, and stocks of homebuilders slumped after a report showed they broadly broke ground on fewer sites last month than economists expected. Lennar fell 2.3%, and D.R. Horton sank 2%.

Northern Trust slumped 5% after the financial services company reported weaker earnings for the start of the year than analysts expected. Johnson & Johnson sank 2.1% despite topping profit forecasts. Its revenue came in a whisper below expectations.

Companies are under even more pressure than usual to report fatter profits and revenue because the other lever that sets stock prices, interest rates, looks unlikely to add much lift soon.

The stock of Donald Trump's social-media company also slumped again. Trump Media & Technology Group fell another 14.2% to follow up on its 18.3% slide from Monday .

The company said it's rolling out a service to stream live TV on its Truth Social app, including news networks and “other content that has been cancelled, is at risk of cancellation, or is being suppressed on other platforms and services.”

The stock has dropped below $23 after nearing $80 last month as euphoria fades around the stock and the company made moves to clear the way for some investors to sell shares.

In markets abroad, stock indexes tumbled across Asia and Europe as they caught up with the drubbing Wall Street took on Monday. Stock indexes fell 2.1% in Hong Kong, 2.3% in Seoul and 1.8% in London.

AP Business Writers Matt Ott and Elaine Kurtenbach contributed.

Copyright 2024 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.

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