Rahul Iyer

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ticket, odds are you also sold an option and didn’t even realize it. As discussed in chapter 1, airlines reserve the option of kicking you off the plane if the flight is overbooked. The lower your fare class, or the cheaper your ticket, the higher you are on the list to be bumped off your flight. Your cheap ticket is so cheap, in part, because you sold an option to take a later flight if the plane is full. The more likely you are to be bumped, the more valuable the option is to the airline, so the bigger the discount on your plane ticket.
An Economist Walks Into a Brothel: And Other Unexpected Places to Understand Risk
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