Cheater’s insurance in Mumbai

Indian blogger Ganesh N. Kulkarni describes a seemingly brilliant scam made possible by the chaos of the Mumbai commute. As Kulkarni explains, Mumbai’s Suburban Railway system carries upwards of 6 million passengers each day over a rail network over 300 kilometers in length that’s spread across a metropolitan area of 468 square kilometers. In short, ...

602956_070329_mumbai_05.jpg
602956_070329_mumbai_05.jpg

Indian blogger Ganesh N. Kulkarni describes a seemingly brilliant scam made possible by the chaos of the Mumbai commute. As Kulkarni explains, Mumbai's Suburban Railway system carries upwards of 6 million passengers each day over a rail network over 300 kilometers in length that's spread across a metropolitan area of 468 square kilometers. In short, it's a huge system. As you can imagine, that makes it difficult for the authorities to enforce the rules. All they can do to keep passengers honest is conduct random spot checks. If you're caught without a ticket, you pay a fine, but the odds of getting singled out among the crowd are extremely low.

Indian blogger of 468 square kilometers. In short, it’s a huge system. As you can imagine, that makes it difficult for the authorities to enforce the rules. All they can do to keep passengers honest is conduct random spot checks. If you’re caught without a ticket, you pay a fine, but the odds of getting singled out among the crowd are extremely low.

So, one group of commuters has come up with a devious insurance scheme, which Stephen J. Dubner summarizes nicely here:

Here’s how it works. You pay 500 rupees (about $11) to join an organization of fellow ticketless travelers. Then, if you do get caught traveling without a ticket, you pay the fine to the authorities and then turn in your receipt to the ticketless-traveler organization — which refunds you 100% of the fine.

Who says cheaters never win? As Dubner notes, one obvious solution here is for the rail system to hire more enforcers (you could also raise the fine), but I doubt his faith that the enterprise could be made profitable so easily. And as one of Dubner’s commenters aptly observes, the fine isn’t the whole cost of getting caught; there’s the embarrassment of being busted in public, plus the hassle of going through India’s nightmare bureaucracy to pay the fine, as well as the inconvenience of having to get reimbursed. At just 20 cents a pop, it’s probably worth buying the train ticket after all.

Tag: India

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